Streamline your b2b sales funnel for Product Management

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I think every single company has to First focus on being product LED and retention period the only way that you will ever have any chance of acquisition being product LED is if you nail your product-led retention let me break it down retention falls into two main kpis which is activation and then engagement if your product is not able to activate and more importantly engage via habitual loops and be in the hobbit-forming zone then you'll have no chance to hooking an acquisition engine into your product because acquisition and product LED means users and buy it or users refer or users create content that attracts other users well if your users are not habitually using your product there's less and less opportunities for you to actually create any sort of product-led acquisition so never start with product LED acquisition you first always have to start with product LED retention activation and engagement then you can choose is your product has a relationship of one to many if it has a collaboration at its core say slack or Miro or even the amplitude or does it have more of a single mode relationship so let's say snowflake there is not one too many relationships there between users well if you have one too many relationships product LED is a fantastic way for you to prototype that model if you don't have them then it becomes increasingly hard and most of the B2B products don't have that one-to-many relationships so it's very difficult to stand up product LED acquisition so you rely on marketing lead and sales lead and that's fantastic those are fantastic growth models as well the only other question becomes in the self-serve monetization that's product LED otherwise you go in the sales LED and you chase up to those large contract values and you can still be product LED and monetization with sales team via product LED sales or you can just be self-serve if you have a specific segment that is valuable for but the question there is your use cases and your Market matureness to handle self-serve or do you need that sales touch every industry and every sector is going through transformation at different velocities so even if you don't have that product like sales or self-serve in your industry now I guarantee you it will pop up in the next 10 years and that you're not going to introduce it you will get disrupted by it say a company starts sales LED on acquisition by the way I love how you're kind of like spanning this would seemingly as a binary idea of product lab for sales like everyone's always talking about them in such simplistic terms and just your way of thinking about it where it's kind of this like I don't know three by three almost it's just bending my brain so I'm gonna try to keep up so say a company starts sales LED on acquisition and later wants to think about adding a product LED self-serve motion do you find that that often Works doesn't work is that like a rare success story or how have you seen that happen I think in order to succeed and own the market you have to do both it's not a question of it working it's the question of how you will make it work the game is a layering game it's a sequential game which one will you introduce first and how can you layer the next one on top of it so if you are sales LED now if you continue being sales LED you have a high chance of leaving a product led to be disrupted by it from the bottoms up but also going from sales led to product LED does not mean you have to abandon sales lead that means you have to hunker down on your sales lead and overlay product lit on top of it to amplify already existing growth never to switch so in the most successful companies whether they go from product led to sales led to sales led to product LED they're able to execute both correctly and together as opposed to saying I have to switch or pick one versus the other and I think it's the biggest mistake when people view it as a decision making of which one I should be versus a sequential play that makes life so much simpler knowing that eventually you're going to do both it's basically a question where do you start I know you have some strong opinions about kind of how product lead often gets crushed by sales being added down the road is there something you can share around that problem you see yes I see a very clear pattern and it's sad that so many companies fall into that pattern even though it's so prominent and the learnings unfortunately don't get shared and propagated enough you start as a product LED company you get the user love they talk about you you have Word of Mouth Loop happening you have Community happening you have great retention you ready to monetize you monetize self-serve and you get fantastic traction you start aggregating multiple users within an organization starting to get inch closer and closer to your first Enterprise contract and it closes and that's exciting it's a big ACV average contract value it's exhilarating it's addicting how many or more of those do we have to close instead of doing these 10 20 30 dollars arpas what if we have a hundred two hundred thousand dollar R bus how fast can we grow you start doubling down and saying let's just hire more sales people we have all of this usage let's put productivity per sales head put that in the forecast hire sales people let's go at the beginning everything is unicorns and Roses because you have very strong usage you have great Advocates your Enterprise buyers are likely already in your user base so you're going and you're closing them but then slowness occurs it always occurs because you run out of Enterprise buyers in your user base because only 30 percent or less times is your buyer gonna be in your usage user base which means that the rest of the accounts usage is happening and it's the correct usage that is leading to Enterprise conversation but you need to go find the buyer because the user does not have a relationship with a buyer that's when you're starting to go up the market you realize that you start hiring Enterprise marketing team demand gen team you start investing into Enterprise marketing activities you seem to be disconnecting the dots and your pipeline is taking on next level of growth and you're starting to close even larger deals you probably remember the first time that you closed your first 200 500 000 a million dollar deal and that's exciting but then at the result of going and chasing after those Enterprise buyers most of the companies make crucial mistake of letting go of their product usage growth of their product LED tactics because you still have to make prioritization in your resourcing do you hire a PM or do you hire an Enterprise rep do you hire a growth PM or growth marketer or do you hire an ABM specialist and most of the time when you're chasing after those Enterprise buyers those personas don't overlap so you have to choose one or the other so you hire for Enterprise because that's what you're doubling down on that's what you board that's what Market wants from you those contracts large contracts and commitments that increases your evaluation however very quickly you will realize that even your sales LED inbound of going on top of usage is going to start drying up because if you're not putting continuous pressure on growing those user growth of driving that community of driving that user habitual Loops even on self-serve monetization your Enterprise will not grow if that was the root of your growth if that was your original DNA and if you let go of that and I would say eighty percent of the companies let go of your product-led initiatives in order of Enterprise they start start seeing a massive slowdown in Enterprise pipe many correct and they realized that they've forgotten the hand that feeds them in the first place and they reinvest into that growth many companies decide to Pivot and say forget product LED were too far gone now we're going to create a sales top-down machine and we're gonna go and hunt those Enterprise buyers and be good at it but that requires a very different work structure that creates a very different profiles of people that you need and the different types of running of business and expectation so it's a dangerous turn for a lot of the companies I just wish that businesses would never forget the roots that they came from especially if they started in plg and have a sense of when to swing the pendulum to the right direction and correct it when it's the right time thanks for listening you can find the full episode on YouTube or head on over to lennyspodcast.com [Music]