5 defining characteristics of a successful PLG motion

Are you faking PLG? Let's find out. Steven Boone, Former RVP of Sales at Twilio, shares what he thinks separates real PLG companies from imposters.

Steve Boone

March 1, 2023
·
3
 min read

The first question that early-stage startups and business leaders often ask is, “How do we fuel product led growth?” But I think a better question to start with is: “Why do we want to become product led?” Will it help you deliver a better experience for customers? Cut down on your go-to-market costs? Or do you just want to bring in more leads?

Becoming product led starts with understanding exactly what it means and doesn’t mean. It’s not a shiny, new lead generation tactic. It’s not offering a faux free trial with a pared-down set of features. Being product led means building something that someone can get value from without engaging with your sales team. If this isn’t your goal, you’re not product led. 

Below are five defining characteristics of running a successful Product-Led Growth (PLG) motion 👇

Your free trial is built for the right purpose.

I don’t know who needs to hear this, but free trials are anything but new—tech folks have been using them to inform buying decisions long before the hype began about PLG. But lately, I see companies lauded as prime PLG examples for free trials that mimic the traditional SaaS sales motion. As in, the customer signs up like a SaaS company, gets assigned a customer success manager, and any semblance of PLG goes straight out the window. 

A PLG company doesn’t want to just get someone through the door via a free trial, freemium product, or otherwise. Even if a customer signs a $500,000 contract, their goal is that the customer can continue to grow naturally within the product without requiring extensive human support.

Yet the lines between PLG, free trials, and lead generation have all started to blur. It’s as though the conversation about free trials started with bunch of business leaders who got together and said:

“Wouldn’t it be super magical if we could get really warm leads who had already done X, Y, or Z to stand up part of our product, and then they’d understand it, and then our deals closed at 80%?”.

Well, yes, of course that would be super magical. But there’s misaligned interest if you’re not thinking about the value that a free trial should add for the customer, such as removing friction or making it easier to stand up the product. If your free trial is meant to open the funnel and let folks try out a couple features, without incorporating robust self-serve features into the product, you’re not PLG—you have a free trial. 

On the other hand, if your free trial lets someone stand up and build out a use case, and only requires them to reach out when things start to get too complex, then you have a great opportunity to enhance the PLG motion layered on top of it.

You weigh GTM efficiency alongside the customer experience (and vice versa!) 

One of the biggest benefits of PLG is not having humans do things they aren’t necessary for. Because of this, every feature you roll out should enhance the customer experience, improve GTM efficiency, or help you do a little bit of both. Making decisions about when and where to involve humans requires balancing both elements in tandem with each other.

Here’s why: Something that might be helpful for customers, such as having a 24/7 customer support line, might not make economic sense for the business. Gating a specific feature set would help reps run a sales play more efficiently, but also create unnecessary friction in the product experience. 

At Twilio, we evaluated scenarios with a self-serve-first mindset: Can a human touchpoint be replaced by a product pop-up? How much more likely will a deal close if a sales rep gets involved vs. not? Or in the case of the customer support example above: Can we add an in-app chat box instead of providing a sales rep’s phone number?

You only reach out to customers if you can provide value. 

The entire point of PLG is to let customers build themselves. At Twilio, every conversation we had around a new touchpoint or upsell opportunity tied back to: “Would customers appreciate someone reaching out at this time?” If the answer was no, we’d try to make it self service. If it was yes, we had an opportunity to deliver real value to customers. 

Here’s one example: In telecom, texting a bunch of invalid phone numbers, such as  landlines, can lead to high undeliverable message rates. If someone has an undeliverable message rate upwards of 10-20%, it could signal to carriers that they might be spamming without consent. Reaching out to customers with undeliverable message rates became a valuable opportunity for us to share guidelines and best practices for consent. It also opened the door for conversations about other Twilio products that could help them cut costs and ensure they remained compliant.

​​When you reach out to customers is just as important as why. Seeing an e-commerce customer’s volume increasing by 10x over Black Friday and Cyber Monday isn’t the right time for a generic “Hi! I noticed you’re using the product more. If this is consistent, you might need to buy more stuff” sales play. In this scenario, the opportunity to deliver value isn’t after the spike in volume—it was before it. The rep should be building trust by proactively sharing unique insights and best practices to prepare their customer ahead of time. (This also gives sales enablement a great opportunity to run a “Three things to do to prepare customers for Black Friday” play.)

Taking an “always be helping” approach will win you way more respect than reaching out because you saw that their company hired a new CTO on LinkedIn. This is also where PLG turns into what we’ve wanted Sales to be all along: understanding the customer based on their product usage and business goals, and then coming in to share a unique insight they can’t get anywhere else. 

You keep sales reps focused. 

If you want to drive an efficient PLG motion, you need to simplify information down for the field. We did this at Twilio by incorporating a “If this, then do that” sales strategy into our Product-Led Sales playbooks. I find that the best time to start incorporating these insights is during onboarding. It’s far too common for reps to spend six months completely overwhelmed by product onboarding information, and emerge without the ability to actually solve specific customer and prospect challenges. 

Your more-tenured reps are often your most valuable source of information here, especially when it comes to specific use cases in the product or the best times to engage with customers. Tap into your best sales reps, the ones who know all the nuances about how to use the product, to start outlining the guidelines. Keep it simple: “When this thing happens, here’s how you solve it, here’s who can help you, and here’s the link to the conversation you need to have with the customer.” 

You’re not afraid to question anything and everything.

Finally, it’s not all or nothing when it comes to having a product-led mindset—especially if you’re running a traditional enterprise motion with sales reps. If your goal is to improve your customer experience, start by removing small areas of friction. Look across the product journey and ask yourself, “Why?”

For example, maybe someone can reload $100 in credits to their account but anything more requires a sales contract. Why? Is it fraud related? Are people dropping off after they hit $100? Is it because they don’t want to sign a contract? Run an analysis with your finance team. What happens if you increase the limit to $500? Would the increase in customers outweigh any fraud-related risks? 

If you can ask 100 of these micro questions, and 10 of them make the product easier for customers to use, you’ll be doing a great job of becoming product led. 

Final thoughts

I hope I’ve illustrated how important it is to question the very nature of your product-led motion. Remember, with the customers best interest in mind, you're always one step closer to making the right decision. Make the human interaction always of value and you'll be on the right track.

Want more frameworks and guides from world-class experts? Follow Calixa and subscribe to the High Intent newsletter to be notified when new ones are published! 

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5 defining characteristics of a successful PLG motion

Are you faking PLG? Let's find out. Steven Boone, Former RVP of Sales at Twilio, shares what he thinks separates real PLG companies from imposters.

Steve Boone
|
Former RVP of Sales at Twilio
|
Twilio

Your PLG roundup in 5 minutes.

March 1, 2023
ReadTime

The first question that early-stage startups and business leaders often ask is, “How do we fuel product led growth?” But I think a better question to start with is: “Why do we want to become product led?” Will it help you deliver a better experience for customers? Cut down on your go-to-market costs? Or do you just want to bring in more leads?

Becoming product led starts with understanding exactly what it means and doesn’t mean. It’s not a shiny, new lead generation tactic. It’s not offering a faux free trial with a pared-down set of features. Being product led means building something that someone can get value from without engaging with your sales team. If this isn’t your goal, you’re not product led. 

Below are five defining characteristics of running a successful Product-Led Growth (PLG) motion 👇

Your free trial is built for the right purpose.

I don’t know who needs to hear this, but free trials are anything but new—tech folks have been using them to inform buying decisions long before the hype began about PLG. But lately, I see companies lauded as prime PLG examples for free trials that mimic the traditional SaaS sales motion. As in, the customer signs up like a SaaS company, gets assigned a customer success manager, and any semblance of PLG goes straight out the window. 

A PLG company doesn’t want to just get someone through the door via a free trial, freemium product, or otherwise. Even if a customer signs a $500,000 contract, their goal is that the customer can continue to grow naturally within the product without requiring extensive human support.

Yet the lines between PLG, free trials, and lead generation have all started to blur. It’s as though the conversation about free trials started with bunch of business leaders who got together and said:

“Wouldn’t it be super magical if we could get really warm leads who had already done X, Y, or Z to stand up part of our product, and then they’d understand it, and then our deals closed at 80%?”.

Well, yes, of course that would be super magical. But there’s misaligned interest if you’re not thinking about the value that a free trial should add for the customer, such as removing friction or making it easier to stand up the product. If your free trial is meant to open the funnel and let folks try out a couple features, without incorporating robust self-serve features into the product, you’re not PLG—you have a free trial. 

On the other hand, if your free trial lets someone stand up and build out a use case, and only requires them to reach out when things start to get too complex, then you have a great opportunity to enhance the PLG motion layered on top of it.

You weigh GTM efficiency alongside the customer experience (and vice versa!) 

One of the biggest benefits of PLG is not having humans do things they aren’t necessary for. Because of this, every feature you roll out should enhance the customer experience, improve GTM efficiency, or help you do a little bit of both. Making decisions about when and where to involve humans requires balancing both elements in tandem with each other.

Here’s why: Something that might be helpful for customers, such as having a 24/7 customer support line, might not make economic sense for the business. Gating a specific feature set would help reps run a sales play more efficiently, but also create unnecessary friction in the product experience. 

At Twilio, we evaluated scenarios with a self-serve-first mindset: Can a human touchpoint be replaced by a product pop-up? How much more likely will a deal close if a sales rep gets involved vs. not? Or in the case of the customer support example above: Can we add an in-app chat box instead of providing a sales rep’s phone number?

You only reach out to customers if you can provide value. 

The entire point of PLG is to let customers build themselves. At Twilio, every conversation we had around a new touchpoint or upsell opportunity tied back to: “Would customers appreciate someone reaching out at this time?” If the answer was no, we’d try to make it self service. If it was yes, we had an opportunity to deliver real value to customers. 

Here’s one example: In telecom, texting a bunch of invalid phone numbers, such as  landlines, can lead to high undeliverable message rates. If someone has an undeliverable message rate upwards of 10-20%, it could signal to carriers that they might be spamming without consent. Reaching out to customers with undeliverable message rates became a valuable opportunity for us to share guidelines and best practices for consent. It also opened the door for conversations about other Twilio products that could help them cut costs and ensure they remained compliant.

​​When you reach out to customers is just as important as why. Seeing an e-commerce customer’s volume increasing by 10x over Black Friday and Cyber Monday isn’t the right time for a generic “Hi! I noticed you’re using the product more. If this is consistent, you might need to buy more stuff” sales play. In this scenario, the opportunity to deliver value isn’t after the spike in volume—it was before it. The rep should be building trust by proactively sharing unique insights and best practices to prepare their customer ahead of time. (This also gives sales enablement a great opportunity to run a “Three things to do to prepare customers for Black Friday” play.)

Taking an “always be helping” approach will win you way more respect than reaching out because you saw that their company hired a new CTO on LinkedIn. This is also where PLG turns into what we’ve wanted Sales to be all along: understanding the customer based on their product usage and business goals, and then coming in to share a unique insight they can’t get anywhere else. 

You keep sales reps focused. 

If you want to drive an efficient PLG motion, you need to simplify information down for the field. We did this at Twilio by incorporating a “If this, then do that” sales strategy into our Product-Led Sales playbooks. I find that the best time to start incorporating these insights is during onboarding. It’s far too common for reps to spend six months completely overwhelmed by product onboarding information, and emerge without the ability to actually solve specific customer and prospect challenges. 

Your more-tenured reps are often your most valuable source of information here, especially when it comes to specific use cases in the product or the best times to engage with customers. Tap into your best sales reps, the ones who know all the nuances about how to use the product, to start outlining the guidelines. Keep it simple: “When this thing happens, here’s how you solve it, here’s who can help you, and here’s the link to the conversation you need to have with the customer.” 

You’re not afraid to question anything and everything.

Finally, it’s not all or nothing when it comes to having a product-led mindset—especially if you’re running a traditional enterprise motion with sales reps. If your goal is to improve your customer experience, start by removing small areas of friction. Look across the product journey and ask yourself, “Why?”

For example, maybe someone can reload $100 in credits to their account but anything more requires a sales contract. Why? Is it fraud related? Are people dropping off after they hit $100? Is it because they don’t want to sign a contract? Run an analysis with your finance team. What happens if you increase the limit to $500? Would the increase in customers outweigh any fraud-related risks? 

If you can ask 100 of these micro questions, and 10 of them make the product easier for customers to use, you’ll be doing a great job of becoming product led. 

Final thoughts

I hope I’ve illustrated how important it is to question the very nature of your product-led motion. Remember, with the customers best interest in mind, you're always one step closer to making the right decision. Make the human interaction always of value and you'll be on the right track.

Want more frameworks and guides from world-class experts? Follow Calixa and subscribe to the High Intent newsletter to be notified when new ones are published!