As we know, technology has advanced drastically over the years, forcing us to adapt and change the way we approach Product, Design, Marketing Strategy, and more importantly the overall relationship between Product and Customer. By improving the user experience for your brand and product, you can achieve customer loyalty, higher engagement, and ultimately product success all resulting in a sustainable growth rate for your company. How do you do this….by being Product-Led!
- What is Product-Led Growth?
- Examples of Product-Led Growth
- How to become Product-Led
- Benefits of Product-Led Growth
What is Product-Led Growth?
Product-Led Growth is the commitment to not only enrich your customers’ lives but to end up with a self-serve product that can sell itself and grow. This vital business strategy involves bringing together contributions of your entire company to create and build successful, appealing products, and to place your product at its core. The idea of this strategy is to improve user experience and increase “go-to-market” speed.
In many cases, this also means reshaping different teams within your company. These teams, such as Marketing, Engineering, and Sales normally operate in totally different ways, but by joining forces you can offer software that is prettier, easier, more powerful, AND more affordable for customers than anything they’ve ever experienced before. This concept is known to trigger an increase in product purchase, retention and lower costs. In simple terms – business growth!
Examples of Product-Led Growth
To achieve Product-Led Growth you must have an immaculate user onboarding. Outstanding customer experience has always been key to success. With Product-Led Growth placing a company´s software at the center of the voyage, let’s explore a few examples.
John Egan said “A lot of organizations say they put users first, but I feel at Pinterest the company really tries to deliver on that promise”. With the company growing at an incredibly rapid rate, they achieved over 100 million monthly active users in September 2015…and what was behind these outstanding results – Product-Led Growth. With a curated attractive feed and personalized user onboarding, this website instantly draws your attention to the Product. With effective leadership and a collaborative, “users over metrics” attitude, Pinterest created an impressive growth-focused business strategy by setting goals as well as being product-driven and customer-centric.
Dropbox model is an easy-to-use software for collaborating and sharing files. This is another perfect example of success with a Product-Led attitude along with an End-User Mindset. With value and customer service being on the priority list, it is no wonder Dropbox has achieved over $1B USD in sales over the last 10 years. The product is used to enhance the user experience, and create team collaboration and engagement. Sharing files has never been easier and more accessible to users.
How to become Product-Led
As we keep repeating, one of the most important aspects of successfully becoming a Product-Led company is the product itself. A product-first Saas, must solve a problem and then deliver the solution promised. The solution needs to be of value to the customer so it has to be easy to use, undemanding and attractive to the user. The product should focus on making it easier for users to manage their day-to-day workflows, so there must be a sense of an achievable goal. It also needs to be personalized so the end-user has a better experience and outcome.
Product-Led companies have a belief that the focus is on the end user, therefore they need to create a “dream team” so to speak, who work together to create an effective flow for your product. Cross-functioning teams create long-lasting positive effects along with the ability to communicate and combine skills, resulting in a well-delivered, high-value Product.
Self Service Trials or “Freemium”
When using a model such as Freemium, your product itself becomes a sales and marketing tool by attracting users without spending money. A user can experience your product at no charge! The intention of this is to engage and attract the user to experience its value well enough to encourage them to commit to upgrading to the paid version. The customer can evaluate the product without paying initially, offering a “try before you buy” approach – win win!
The Benefits of Product-Led Growth
Now let’s be honest, rapid changes and growth within your company don’t happen overnight. It takes teamwork, resilience, and commitment to the product itself. Product-Led Growth isn’t only beneficial for users, but also for business. Benefits of this model include:
- Higher financial productivity, or in other words – increased MRR!
- A lower customer acquisition cost thanks to Freemiums or Free Trials
- Shorter Sales Cycles
- A product with higher NPS and brand advocates
- Up to 30% more annual revenue over non-Product-Led competitors
- Better team productivity and alignment
To conclude, adopting a Product-Led Growth Model creates a customer-centric mindset that in turn makes for a more viable and valuable product resulting in higher MRR than a sales-led model. By leading with your product throughout your organization, you can achieve outstanding benefits, reduce churn, and offer sustainable growth for your business.