I recently shared a few quick thoughts on how the SaaS sales playbook has to be adapted to work well in a product-led organization. Here are some more details on those thoughts…in no particular order.
Assess the current state.
The biggest mistake you can make when building the sales motion at a product-led growth is to come in and just apply the standard SaaS sales model. Before you assume you need X number of SDRs to open X number of opportunities for X number of AEs, and each AE can close X number of deals per month at X ARR value…stop. Assess what’s actually going on.
To do that, you are going to need to understand where the deals are coming from, channels, ARPU (and ARPU by channel if needed), sales cycle (if any), who is buying, how often they are buying, how they expand organically, etc.
If you have some salespeople, get on the front lines with them to really understand the sales cycle and where the leads, new deals and expansions are coming from. In a true PLG company “deals” are coming from individuals who buy (even if for a business purpose) on your website primarily. But they may be also be coming in via other channels, like website chat, or support tickets. In product-led growth you have a lot of incoming demand to buy, some of it happening self-service, some of it happening sales-assisted, some of it organically through customer success or support. Understand how your customers are buying today in order to determine how to capture even more of that and not get in the way of what’s already happening.
Bring down any hurdle, large or small.
In a traditional SaaS sales model, all qualified leads go to sales. Period, end of the story. But in PLG, routing all the hot leads to sales may not be necessary. In a true product-led company a lot of leads can probably skip sales and go straight to a purchase.
They may need to issue a PO or have already issued a PO and need somewhere to send it. They may need wiring instructions. They may need some security questions answered before they are allowed to sign up. They may be required by their procurement team to actually speak with a vendor before forking over money. But what they don’t need is to be put through your sales process.
Not every buyer in a product-led world can whip out a credit card and sign up online. If you are sending these people to sales, you might be overcomplicating it. And if you aren’t allowing these customers to buy via a sales-assist instead of online self-service only, you are probably leaving money on the table.
Self-service takes many forms. You think of it as signing up on a website, but for your buyer it may be that they are ready to buy (just like a self-service deal) they just need to interact with a human to do it. Think of this as sales-assisted versus sales-driven.
And it doesn’t have to be “sales” as we traditionally think of it. You can assign a deal desk coordinator to transact those inbound hot leads who are ready to close. There is no need to pay commission on this type of deal (more on this later).
If people are reaching out trying to buy, don’t force them to a salesperson, and don’t force route them to buy online. Just have a process that supports a lightly-assisted sale.
Incentivize the right things.
If you have a situation where “deals just close themselves”, don’t compensate sales reps on those deals. I know this is controversial, but the worst thing you can do is send leads who are literally ready to close to a salesperson and pay that salesperson commission.
First, there is just no reason to carry the expense of sales on those deals. You don’t need sales for customers that are ready to close (you do need expansion sales though…keep reading below).
Second, it creates really, really bad habits that will come back to bite you at some point. Salespeople who are just taking orders aren’t actually selling. They aren’t creating or finding a need, they aren’t adding value, they aren’t positioning your product. They have no burden to keep their saw sharp and develop their skills. Discovery goes out of the window. Demos get sloppy. They may know the right things to do, but without having to do them, things get messy.
Know that I am not bashing salespeople. I love salespeople. I am a salesperson. I just don’t think it’s good to put salespeople in roles closing deals that would otherwise close on their own. That’s not sales. That’s customer support. And don’t get me wrong, a product-led company needs sales, just not for those leads who will close on their own.
What you want to incentivize are renewals and expansions. Determining the right mix of incentives in a product-led organization can be tricky. Some people have even suggested PLG sales orgs shouldn’t have variable components to their comp. Be thoughtful about sales comp—you get what you incentivize.
Get creative, and specialized, with your SDRs.
Have some SDRs do true outbound to accounts you don’t have yet. It’s inefficient, but it’s a good muscle for your organization to have in case there is a market disruption and the flywheel stops working as well.
Have other SDRs find potentials targets inside of accounts you already have—teams who aren’t yet using your product.
Have other SDRs prospect small existing teams to try to make inroads to grow them into larger teams.
In product-led growth the SDR function isn’t just inbound or outbound. There are different variations needed, which require their own specialized talk tracks and cadences.
Build an amazing expansion sales team.
In a strong PLG company, it’s not about land, it’s about expand. Get out of the way of “land” (as outlined above) because it will happen on its own, and put your energy and effort into “expand”.
Build a team that can take a small team of 10 people using your product at GE into a multi-million dollar deal. Build a team of people who can prospect into accounts you already have to build a stronger base of users so you can speed up that organic growth that’s already happening. Build a team that can call individual users to make inroads to centralized decision-makers.
In a PLG land and expand motion you want to move from a bunch of individuals choosing your product to the company choosing your product.
Great salespeople can transform the relationship your company has with your customers. When your top-down expansion team meets your bottoms-up growth machine, magical things can happen. You’ve essentially added fuel to a flame that was already burning.
Don’t over complicate it.
In a product-led company there is a lot of reactive, organic expansion. One person inside of a company has a problem to solve, so they sign up for a free trial. They invite a few colleagues. They use the product and it helps them. They convert to a small team account. They invite a few more colleagues. And then colleagues in a neighboring team get wind and they sign up, and so on and so on in a beautiful flywheel motion. And when this is happening, invariably at some point someone calls into your company to say, “Hey, I’m John and we need 500 more seats.”
Your sales process should be: get out of the way and let the customer buy.”
Don’t overcomplicate this. Don’t assign it to a salesperson before letting them buy. Or try to overlay your sales process on it. Just take the order for 500 seats. Whether they submit a support ticket, call your main phone number, or respond to a marketing email. Just let them place the order. You can overlay your great sales process after you get them the 500 seats they need. Your sales process should be: get out of the way and let the customer buy.
I love a good sales process as much as the next person, but qualifying buyers who are ready to purchase your product is the wrong approach.
Sales, customer success, and support need to be tightly aligned, matrixed together and have playbooks for collaboration and coordination so they can all meet the buyer where they are in their journey.
New customers, and expansion customers, are going to come in via phone calls, support tickets, random contact us forms, online chat, etc. Let it happen. Build your process around this, versus forcing your customers into your process. Your process is their process.
When implemented correctly, a sales team increases a business’ natural rate of growth, or how fast they grow organically before layering in incremental sales or paid marketing. Sales teams drive growth by catalyzing faster expansion within existing customers, improving free to paid conversion, increasing deal sizes, and offering a better customer experience for prospects who need more help.”OpenView
Just get out of the way
Bottom line If you come into a product-led growth company and try to apply the standard SaaS sales playbook there is a good chance you will get in the way of what’s happening organically with your preconceived notions about how a sales organization is supposed to run.
In product-led growth, let the buyers show you the way. Understand what’s happening and where the growth is coming from. Understand how the buyer wants to buy and then enable that. Support organic expansion, and hustle for expansion you might not otherwise get.
Your process & playbook gets applied after the initial sale when it’s time to expand and renew. Product-led growth is also buyer-led growth. That means we need to stay out of the way.