If you’re not already investing in product-led marketing for your SaaS (Software as a Service) company, now could be the time to start. The SaaS market is growing more competitive all the time, and customer acquisition costs are gradually increasing, causing major issues for marketing teams.
Fortunately, the world’s leading brands, from Notion to Slack and Zapier, seem to have identified the problem and found a solution. The issue? Lack of trust. Customers no longer believe the lofty claims companies make about what their offerings can do.
The solution? Proof. Product-led marketing involves placing your product at the center of your marketing strategy. It allows them to experiment with features themselves, share feedback, and quickly validate a return on their investment.
Here, we’ll show you exactly how product-led marketing works and how you can use it to accelerate your growth potential.
What is Product-Led Marketing?
Product-led marketing is a go-to-market (GTM) strategy that revolves around your product. It’s a way of acquiring, engaging, and even retaining more customers by offering them easy access to your product and capturing their attention with a proof-led experience.
This methodology differs from the standard sales-led growth method, which often relies on companies creating marketing campaigns and sales pitches to boost business growth. Product-led marketing teams leverage the core product of the company as their core marketing vehicle, allowing it to essentially “speak for itself.”
Instead of just telling your customers you have the best email marketing software around, for instance, you give them a free trial of that software, along with a personalized onboarding and training experience, so they can see the benefits first-hand.
Once you’ve seduced your customer with the “free” version, or demo of your solution, you use upselling and cross-selling methods to turn them into a loyal, paying customer.
The Benefits of Product-Led Marketing
As customer expectations evolve and competition in the SaaS space increases, companies are struggling to achieve consistent results with traditional sales-led marketing strategies. Consumers are less tolerant of the traditional approach to advertising. They don’t want to make hefty purchasing decisions based exclusively on your case studies and customer reviews.
They want to personally put your claims to the test.
According to a TrustRadius report, blogs, marketing collateral, and website content are the least trustworthy assets used by brands. However, genuine experiences, free trials, and referrals generate the most trust among new consumers.
This resonates with the fact that HubSpot found that only 3% of consumers trust marketers and salespeople. Ultimately, customers don’t believe you’re just trying to make sure they’re getting the right product, they know you’ll do anything you need to do to get a sale.
That’s why product-led marketing works. It puts customers back in control and allows them to “try before they buy.” It also drives incredible results for companies, such as:
- Shorter sales cycles and acquisition costs: Product-led companies are often leaner, benefitting from shorter sales cycles, quicker sales, and lower customer acquisition costs. Companies spend less on paid advertising, and allow their product to do the talking.
- Better customer focus: Sales teams focus their attention on “product qualified leads” rather than “marketing qualified leads, which are generally more likely to convert. PQLs are familiar with the product and are easier to nurture into paying customers.
- Better customer loyalty: Because there’s a strong focus on enhancing the customer experience with product-led marketing, it’s easier to nurture loyalty. This can lead to better retention rates, and higher customer lifetime values.
- Valuable insights: Product-led marketing usually involves collecting a lot of customer feedback and tracking metrics related to customer experience. This can lead to better product development decisions and more personalized marketing campaigns.
- Enhanced growth opportunities: Cultivating loyal, happy customers helps companies create advocates for their brand who can contribute to sales through word-of-mouth marketing. This further reduces marketing costs.
How to Implement a Product-Led Marketing Strategy
Many leading SaaS companies have already proven that product-led marketing works (we’ll cover some key case studies below). However, implementing a product-led marketing strategy can be more complex than it seems.
First, you’ll need to develop the right pricing strategy, which includes offering customers a free version or demo of your product they can try. Then, you need to implement the right approach to upselling and commit to delivering a fantastic customer experience to generate revenue.
Here’s how you can get started.
Step 1: Design your Freemium Model
As mentioned above, the “freemium” or “free trial” model is critical to a product-led marketing strategy. The only way you can “let your product do the talking” is to give your customers access to it. A free trial or demo gives your customers a chance to test the product for themselves and decide whether it’s right for them, reducing the risk involved in a later purchase.
Implementing a freemium model is a little trickier than it seems. First, you need to decide exactly what customers will get with the free version of your product. Are you going to offer full access to your entire solution for a limited time? Or do you want to give customers access to a “free-forever” version of your product with limited features?
Then you need to consider how you’re going to make upgrading to a paid model an appealing option. Usually, this means promoting access to extra features, or in the case of the “trial” option, betting on the fact that customers won’t want to go without your product after trying it.
Whichever strategy you use, simplify the process of signing up for your free trial, so you can collect as many leads as possible. Only ask for necessary information from your customers, and make sure that includes their contact details, for nurturing purposes.
Step 2: Build your product-led marketing team
One of the major challenges of switching to a product-led marketing model is that it requires closer collaboration between various members of your team.
When your product takes center stage in all of your marketing campaigns, your product development and marketing teams need to be closely aligned. Your product marketing team needs to be able to constantly interact with your customers, gather insights from them, and think about their pain points and goals when building marketing campaigns.
They also need to pass that information over to the product team, so they can build valuable resources into the product itself (such as educational content).
Ensure your product and marketing teams have access to:
- Shared data about your target audience, competitors, and market.
- Cross-functional workflows so they can work as a cohesive unit.
- Feedback from customers and insights into reviews.
- Product information (how it works, features, and benefits).
- Customer journey maps and funnel analytics.
It’s also worth ensuring your teams know how to identify “Product Qualified Leads.” You should be able to segment customers who try your product into a specific group so you can target them with personalized content relevant to their experiences with your brand.
Step 3: Gain a Deep Understanding of Customers
Product-led marketing is all about capturing and converting leads with providing them with the best possible solutions to their problems. This means you need a comprehensive understanding of the challenges your customers typically face, and the goals they want to achieve.
Conducting research into your target market is a good first step. You should be able to use market research to learn more about what your audience wants. For instance, if you’re selling email marketing software, tracking email marketing trends is a good idea.
However, you should also be building on this information with data directly from your customers. You can get this through customer support tickets, social listening, and surveys.
Survey your prospective customers and existing customers with questions like:
- What are the biggest problems they face (related to your offering)?
- What goals do they want to achieve, or what do they expect from a product like yours?
- What does their ideal solution look like?
- How have they tried to solve their problems in the past?
- What do they like and dislike about other similar solutions?
Once you’ve collected this data, you can use it to move on to the next step.
Step 4: Create SEO-Optimized Educational Content
When you know your customer’s goals and problems, you can create educational resources that enhance your product-led marketing strategy. The first set of educational resources you create will be linked to your traditional marketing assets, such as SEO-optimized blog posts and marketing videos.
With product-led marketing, your focus should be on “educational” content. Educational resources that address common customer issues, rather than actively trying to “sell” your product, show your customers that you’re putting their experiences first.
For instance, if you’re selling influencer marketing platform software, you might write blog posts about how to find a good influencer or create videos that show how customers can sort through influencer options.
Remember, just because you’re not creating content specifically designed to “sell” anything doesn’t mean you shouldn’t be following standard best practices. Make sure all of your blog posts are optimized with relevant keywords and phrases, and guide customers to your free trial at the end of each piece with a clear CTA, like MailChimp:
Don’t forget to optimize your product demo and other marketing videos on channels like YouTube for SEO too. Your aim should be the first company your customers encounter when they’re searching for ways to address challenges your product can resolve.
Step 5: Embed Educational Content into your Product
Once you’ve convinced customers to try the free version of your product, your goal should be to give them the best experience possible. The better the experience with your product, and the faster they can see its value, the more likely they’ll be to become paying customers.
Key strategies to use include:
- Onboarding checklists: Welcome customers into your software with an easy-to-use onboarding experience that walks them through the product features and use cases. Consider personalizing the experience based on the goals of your user.
- Tooltips and guides: Include contextual support within your software whenever possible to help users get the most out of its functionality. For instance, show them how they can create a video clip with your recording tool and share it with team members with pop-up videos.
- Self-guided tours: Design multi-step product tours and interactive walkthroughs that show customers how all the free and premium features of your product works. Include an option for them to share feedback or send questions directly to your team.
- Knowledge bases or chatbots: Add a knowledge base to your software where you answer commonly asked questions and help customers troubleshoot issues. Or give them constant access to a chatbot to help with the process.
Here’s an example of how Notion personalizes the product experience for its customers by asking them how they’re going to use the solution during the onboarding journey:
Step 6: Invest in Powerful Upselling Strategies
With product-led marketing, your first focus generally isn’t on making a sale. Instead, your team focuses on “micro-conversions”, like getting customers to sign up for a free trial, complete the onboarding process, and experiment with your app.
However, you should be constantly looking for ways to convert happy “free trial users” into paying customers. You can do this in a number of ways. You might send email campaigns to your customers once they subscribe for a free trial, introducing them to new features or premium options.
This is a great way to nurture your customers and constantly remind them of the benefits of upgrading to a paid plan. Another excellent option is to embed upselling strategies directly into your software. You’ll need to be careful not to be too annoying with this method (by constantly bombarding customers with pop-ups).
Instead, gently remind customers of what they can accomplish if they sign up for a paid plan with your service. As an example, Asana regularly reminds customers of what they can get if they upgrade to a premium plan when they click on certain tabs within the platform:
Step 7: Prioritize Customer Feedback
Listening to your customers and learning about their goals and pain points isn’t just something you need to do at the start of your product-led marketing journey. Successful product-led marketing campaigns revolve around constantly listening to your customers.
Encourage customers to share their feedback as often as possible (even if they’re just using your free trial). Ask them to rate specific features with stars, share their comments about what you can improve, and even provide in-depth feedback in exchange for discounts on paid plans.
You can also build on those insights with social listening tools or monitoring tools that allow you to track reviews on third-party websites.
Once you’ve collected reviews from your customers, use them to guide your future educational content, the updates you make to your product or service, and your marketing strategies. It’s even a good idea to share reviews from customers directly on your sign-up page to help compel new users to try the product for themselves.
Social proof like this helps you gain user trust and further reduces the “risk” associated with giving your product a test run.
Step 8: Track the Right Performance Metrics
Finally, you can’t change the way you approach marketing as a SaaS company without also making altering how you monitor your results. When you switch to product-led approach, you’ll need to stop focusing so heavily on measuring market results by number of leads, or sales results by leads closed.
Instead, you should focus on things that provide you with insight into customer satisfaction, such as time to first response, customer satisfaction rate, daily active users, and net promoter score. Other key KPIs product-led teams focus on include:
- User recommendations or referrals
- Customer acquisition costs
- Time to value for customers
- Customer activation rates
- Customer lifetime value
- Free-to-paid conversion rate
- Expansion revenue
- Average revenue per user
Leverage these metrics to ensure that you’re constantly optimizing your product-led marketing strategy with a focus on generating satisfied, loyal customers.
3 Product-Led Marketing Case Studies to Learn From
Now you know how to develop your product-led marketing strategy, let’s take a look at some examples of companies that have implemented these methods effectively.
1. Userpilot
Userpilot is a company that creates software to help other companies pursue their product-led marketing strategies. Their platform gives companies access to tools to enhance onboarding, analyze customer behavior, collect feedback, and more.
As well as allowing customers to get started with a free trial, Userpilot fills their software will valuably tools and guides to educate their users, and help them accelerate time to value.
There are tooltips built into the platform itself, a chatbot that can offer additional support and plenty of extra guides and webinars available on the company’s website. Plus, the company creates product-led marketing campaigns that focus on educating customers (rather than just selling).
2. Slack
Slack is one of the best-known product-led companies in the world. For years, it has given users free access to its messaging tools and even continues to offer a comprehensive forever free plan. The company uses a range of strategies to drive product-led growth.
For instance, Slack’s blog and website are filled with educational resources that help to encourage customers to sign up for a free trial. It even uses customer reviews and case studies on its website.
Secondly, when you sign up for Slack’s free version, you’re greeted with an intuitive user interface that surfaces tips and guidance as you work.
Slack even frequently sends messages to its subscribers via chatbot and email to remind them of the extra benefits and features they can access by upgrading to a paid plan.
3. Notion
Notion’s intuitive approach to product-led marketing has helped it to achieve incredible growth over the years. The notetaking and collaboration platform gives users access to a fully free plan, which includes many of its core features.
However, the company also regularly encourages customers to sign up for a paid plan. It sends email campaigns to customers highlighting new premium features, and reminds customers of the benefits they can get from upgrading when they’re in the app.
It also uses social proof and customer stories to earn the trust of its customers, and convince them to consider becoming a paying customer.
Using Product-Led Marketing For Growth
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Product-led marketing is one of the most effective ways for SaaS companies to earn, engage, convert, and retain customers in a competitive marketplace. As customer acquisition becomes increasingly difficult (and expensive), countless organizations have already embraced product-led marketing.
Many of the top SaaS companies, from Slack to Dropbox, have seen exceptional results simply by putting their product at the center of their marketing campaigns. Not only do they engage more customers, but they usually earn bigger sales and retain buyers for longer.
However, implementing an effective product-led marketing strategy can be complex. You need the right approach to connecting with your customers, collecting feedback, delivering a great experience, and even driving upsells.
If you need help building the perfect product led marketing strategy, reach out to Growth Collective today to be matched with a leader in product-led growth methodologies.
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