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Product-led growth, a buzz word or just good business?

Wes Bush | Author of "Product-Led Growth" & Host of ProductLedSummit.com

  • | Activation | Growth | Onboarding | Pricing | Psychology | Retention | Sales
  • July 2019
  • EP19

Product-led Growth

A buzz word or just good business?

Today on the show we have Wes Bush, Author of “Product-Led Growth” & host of the ProductLedSummit.com.

We chatted about what product-led growth is and why you should care. Why Wes started the Product-led Summit, and how you can get started with Product-led growth.

We also discussed the importance of striking a balance between educating and motivating your users during user onboarding, why optimizing the first 5 minutes of a users journey is make or break moment and he provided a methodology to do so.

Wes also shared how to pick between a freemium and trial model in a product-led strategy, A framework for pricing and packaging a freemium offering, and what he would do starting out at a new company trying to tackle churn.

I’m excited to hear what you think of this episode and if you have any feedback I would love to hear from you. You can email me directly on Andrew@churn.fm

Enjoy the episode!


Highlights

Time
What is product-led growth and why should people care? 00:02:30
Why optimizing the first 5 minutes of a users journey is make or break moment 00:06:45
A methodology for optimising user onboarding 00:10:30
Striking a balance between educating and motivating your users during user onboarding 00:13:30
Freemium vs trial in a product-led strategy, how to pick a winner for your business 00:17:30
Why time to value is an important factor in deciding on a freemium vs trial model 00:23:30
Why Wes started the Product-led Summit 00:25:30
How to get started with Product-led growth 00:27:30
How to make the shift from Sales-led to product-led growth 00:31:00
What Wes would do starting out at a new company to tackle churn 00:32:45
The importance of product research in a Product-led strategy 00:36:00
A framework for pricing and packaging a freemium offering 00:38:00

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Wes Bush

Author of "Product-Led Growth" & Host of ProductLedSummit.com

Wes’s recommended resources on churn
What Wes is reading right now

About the podcast

My name is Andrew Michael and I started CHURN.FM, as I was tired of hearing stories about some magical silver bullet that solved churn for company X.

In the real world tackling churn and increasing retention is one of the hardest problems a subscription business faces.

In this podcast, you will hear from founders and subscription economy pros who are taking a systematic approach to increase retention and engagement within their organizations.

Transcription

Andrew Michael
Hey Wes, welcome to the show.

Wes Bush
Andrew, thanks for having me.

Andrew Michael
It’s pleasure. It’s great to have you like we just recently spoke, you busy organising now the product lead Institute. And that’s ongoing. I think that should be by the time this episode airs, it’ll probably be in mid swing as well. I think it’s really is fascinating. I’ve been seeing it online everywhere. You’ve had some fantastic speakers lined up to talk about the steps of product lead growth, which I would love to touch on today. You’re also the author of product lead growth book, which was recently launched, I think, in May 28. That was shipped. And we’ll touch on that today. And three times all you’ve been a CXL Institute, you’ve been a product lead growth instructor there, as well as where you hit up demand generation specialists and videoed. So interesting career up until now with I think let’s start with the topic of today’s interviews, productive growth. What is it? And what should people care?

Wes Bush
Yeah, so product lead growth and actually argue is nothing new. Whether you go to let’s say, a grocery store, or even let’s say Costco, they offer you a free sample it at its core product, that growth is all about letting someone try before they buy. And now it’s really just taking the b2b SAS space by storm. Because people want the same experience. They demand the same experience whenever it comes to software. And I mean, who’s to blame them, you look at your consumer apps, and they’re all self serve, and you get to try them before oftentimes you even have to buy. And so that’s really to me like product that grows at its core. It’s just helping people try your product before they buy.

Andrew Michael
Yeah, definitely. I think that’s, that’s a huge growing trend. Now, we talked about this previously with Patrick Campbell from profit. Well, what led you into sort of like this direction? Like, when did you realise that this is the way that the like software and the world was going? And what motivated you to write the book?

Wes Bush
Yeah, so what really got me into product growth was I was always in demand generation digital marketing for b2b SAS companies. And so when I initially started, I was working at companies that were really sales lead. And you know, we did whole traditional approach to marketing, probably pretty familiar with this, you’re right content, you put up a landing page, put up a lead form, direct a bunch of traffic to it. And then you somehow qualified people based on their company size, your reach out. And most times, they’re like, Huh, who’s your company? Why you reaching out? I don’t want to talk to you. And that’s kind of the the typical conversation for a lot of these inside sales organisations. And I just thought that that whole process was a little outdated. And it wasn’t until launched a freemium product, a video called go video where we got over 100,000 users downloading it really quick, that you could really grow a product and a business by just letting people try your product, instead of forcing them through this long drawn out content cycle where people are just inundated with content nowadays, I really truly feel like inbound marketing. Yeah, it’s, it’s great and all, but people came for your content, but they’re staying for your products. And so leading with your product is a really great way to shorten your sales cycle. And, yeah, power that forward. And so as soon as I realised that, I really just wanted to double down on it, I made so many mistakes, along the way of building product that organisations that I really wanted to just help more people about, figuring out how to do this. And so my whole book product that grows is it’s a playbook. It’s a how to book on how to build a product, that organisation and so I really wrote it for a few of my clients who are really struggling to transition from more of a sales organisation to a product, that organisation and so my hope is that it’s going to be able to help hundreds of thousands of people who are operating b2b, SAS businesses to make the same switch.

Andrew Michael
Absolutely. It’s a self selection process, like a self qualification is on itself. So you’re allowing your customer to qualify themselves as then it even if you do at the end, have a sales team that’s on board, your leads are lots of work coming in having tried the product having understanding what the value is, and it just sort of shorten that cycle down completely. So talking about like this thing in the context of churn. And I think this is definitely something as well that you tend to typically see lower churn rates when you allow customers to try before they buy, because you’re not forcing people into direction before they know. And they understand the value to give them the concept of churn like what are some of the things that you’ve noticed and the benefits when it comes to product growth, that really helps impact like that, the churn rate?

Wes Bush
Yeah, so the biggest part that can really impact your turn right, is that first five minutes where someone signs up for your product, and they want to check it out. And so many companies totally botched this whole experience, and is really the biggest lever that a lot of companies, if you do have a free trial for your model, if you optimise this section of the funnel, that first five minutes between sign up and trying your product, you can really dramatically improve your churn rate. And if you look at some stats, even by intercom, according to them at least 40 to 60% of your users, as soon as they sign up for your products, 40 to 60% of those same users will never come back. And so that’s pretty scary. You think about your marketing budget, like all right, let’s just cut out half of it, and throw it out because it’s not getting used. And so when you look at how to reduce your turn, that first five minutes is is a make or break opportunity. And so it’s really improve it I find most SAS companies try and treat that first five minutes is this whole onboarding one trick pony, where you’re trying to onboard the user, your entire product, and that, depending on your b2b SAS products, can be an extremely tall order. And this person, let’s face it, including you are busy. And you might have to three minutes, maybe less to even check out the product before you have to go to a meeting or do something else in your work day. And so if you really want to reduce your turn, what you have to do is just make there be a good reason to come back. So if we even look at Hot chart, for instance, your product hot jar is pretty useless unless you do one thing, which I’m sure you probably right that is but that is uploading a script to your website. And if you can get someone to do that, in that first visit, well, the next time they log in, it is amazing, you can actually see how people are using your product. And then you can really expand like okay, now set up a poll, set up a survey, and really expand into that journey and really help them as dots your whole product. So if you’re really curious about how to reduce turn, focus on that first five minutes, and if you can just get people to do one thing that will help them really create a better experience in your product the next time they come in.

Andrew Michael
Yeah, very interesting. I mean, this is definitely a topic that came up as or previously when we were speaking to Sean Klaus from Atlassian. Atlassian. very similarly, in the early days really tried to understand what was leading to retention. And obviously, at a point, they got to a stage where they had a data team, and they could run different analysis and understanding. And what they ended up finding was the biggest indicator, which led to retention was the amount of time that the person spent in their first session, it was the single biggest indicator, if somebody was going to stick around in the long term was how long that first session was. It’s interesting that just says we’re like 40 to 60% is a stat that intercom is speaking because obviously they have access to quite a lot of that data as well coming in. So let’s talk through the concept as well, a little bit in detail. And we’re talking as well, like now sort of like in event based onboarding sequence by the sounds of it. It’s not just about like, throwing everything and seeing what sticks with your customers, you know, that’s been a little bit deliberate. Like, how do you typically advise, companies get started with this first five minutes and optimising to ensure that they can retain customers?

Wes Bush
Yeah, so the first thing I really focus in on is creating a straight line onboarding experience. And so what this will look like is, let’s say we sign up for HR, we’re going to go through the whole onboarding experience, every single step, we’re taking a screenshot of every step, and we’re going through the whole experience. And as we’re going through it, you’re going to take the shortest path you can to accomplishing meaningful outcome, which in this case, let’s just say it’s heat map, since we’re all familiar with heat maps for the most part. And so you’re going to take us through every single step. And then once we have, at this point, it might be like 20, to 50 screenshots, we’re going to go through each and every one of those steps and really analyse, okay, which of these is maybe an advanced app, this is something that someone can actually do maybe a second time, maybe it’s setting up a poll, it’s like you don’t have a heat map down, you don’t have the JavaScript on your website. I mean, that’s some more advanced stuff that you don’t need just now. So like, let’s, let’s delay that, let’s not scrap it, delay it. And then there’s going to be some steps that will really just get in the way. So a perfect example here is a company called snap calm, is basically requiring or they did before they found out how effective it was to remove this one step. But they required users, like many SAS companies to once once you sign up to activate your email, and so that one step where for many companies for security purposes, it’s it’s still required. And so they required people at the very beginning to sign up, and then go to their email and activate. And so that one step, I really challenged them to just delay it, not remove it completely, but delay it. So we said, All right, the second time someone logs in, they actually have to activate their email then, but not for the first time. And so what we saw was that 27% of people who would normally just totally go out of that experience, they would never activate their email, they would completely leave snap, and never return ever again after they signed up. So those people actually started using the product, fancy that and they started upgrading just like everyone else would at the same conversion rate. And so there’s always going to be steps like that, in your onboarding flow, where you really have to challenge like, is this getting someone closer to having that moments in your product where they say, Wow, like this is this is what I want. This is the value because getting someone from a free user to a paying customer isn’t about writing the most salesy email out there, even if it’s beautiful, like hiring the most expensive copyright in the world like no, that is not going to work? Well, it will, it will really work 10 times better is focusing on helping someone become successful, because if it gets to that point, it really does become a no brainer for them to decide on their own terms. Okay, that was totally worth upgrading, because I love this product.

Andrew Michael
Yeah. So I think what you’re saying is well, with onboarding, it’s, it’s really critical as well to take into consideration the user psychology going into it. So a user initially as a problem that come to your product, they all excited about it, they want to get started, they want to see that value. And each barrier that you put in their place is like one sort of step and one sort of way of the motivating your user. So like, I like this thing that you mentioned, as well, specific victory with email validation, that is typically a very disruptive experience having to leave the product and come back. And it’s sort of like helps with that the motivating your your customers and your users. And what you really want to be doing is like, keeping them excited, keeping that motivation level up high. The one challenge I find that I think with onboarding is, you tend to have two sides. So you mentioned the one side where people try throw everything at you. And then you have the opposite where people come in with this mindset of let’s make it as simple as possible. Let’s cut out what we can. But I think what ends up getting lost in the end, is it like onboarding, and that when somebody signs up for your product, is the time that you’re going to get the most attention ever from your customer, like, like you said, Those first five minutes is the most critical, it’s also because it’s the most time in the most attention you ever going to get from your user to when they’re most excited about your product when they want to get started? Like, how do you strike a balance between what to include and what not to include? And like, when do you know that you’ve gone too far, or you had the right in the sweet spot?

Wes Bush
And so that’s a really great question. And it really comes down to how your product is structure because you really don’t want to over index on the straight line, let’s say and just have like, here are just the steps you need to become successful. without actually helping someone get in touch with the product. Like let’s say, if it’s just one thing on one screen, you never see the product until you’re actually down the street and experience like that is actually pretty just orienting because it doesn’t actually show people how to use your product at all. And so that is something where maybe the second time they log into the product, it’s gonna be hard because they’re almost starting from square one already, where, whenever you’re creating this experience, one thing is, at least at the beginning, I always recommends using, like a more stronger version of helping people. So if you sign up for, let’s say, an accounting app like wave, you’re going to be prompted with three things you can do in a product, like do you want to set up payroll? Do you want to set up your taxes? Do you want to see your finances. And so there’s three very specific outcomes that I can accomplish. Now, I don’t see the product at this point. But I get to select, okay, this is what I value the most. And what they’ve done is after that point, it’s just this straight line experience in the product. And so I’m still accomplishing what I want and the products but by really guiding me at the beginning, they can really prioritise. Okay, this person’s interested in payroll, so let’s not take them through that, you know, really boring part of the product called taxes that we all love. And so if you do that, it can make it a lot easier for you to kind of have that balanced approach, which, yeah, thanks for bringing that up. because there wasn’t too clear with the straight line and boring.

Andrew Michael
Yeah. And I think as well like the what you’re saying now as well is like really focusing on the use cases, as opposed to the features themselves. So what people can achieve with your product is really key when it comes to sort of onboarding, it’s not about like, look at feature x, or look at feature. While this is how you switch to the nice switched off. It’s like, really speaking to the user and the language in which they understand asking them what are they trying to achieve? And then through that understanding, guide them through what they need to be setting up and what they need to be focused on. Absolutely. So you mentioned as well, like in the beginning, like it’s really about having an offering, whether it be freemium or trial, and I’m interested to hear your opinion in this sort of product lead growth, when it comes to like freemium versus a trial period, and what you typically advise and what you’ve seen, like through the research, you’ve done writing the book, what seems to be more effective for companies?

Wes Bush
Yeah, and this is one of those things where I really wish there was always going to be this perfect answer, I’m like, you would work great for you to everyone does have freemium, but it’s not always that case. And so what I really look for first, at least is the time to value like if you have a very, absolutely complicated products, that you just sell the enterprise, you have these very long sales processes, you might just want to start with a trial because even if you offer a freemium option, is going to take forever for people to really experience the value if it’s freemium, and you really want to have more of a high touch experience. And so typically, in a nap case, using a free trial will work better if you have a much longer time to value. But I’ve also really, after helping quite a few companies figure out like, should you go freemium or free trial? I put together it’s only I think, 12 questions. It’s a free quiz on gated, but you can go to product lead.com slash quiz, and just go through the questions and really understand like, okay, it’s depending on your market, depending on the audience you’re serving, what would work best for you? And it’s just simple, yes, and no questions for the most part. But I find that that can be a really great leading indicator of which option you should have.

Andrew Michael
And so what is some of the like, these questions that you’re saying? What are some of the direction that you taking customers on in the thought process?

Wes Bush
Yeah, so it covers four main parts, the first part is just your market strategy. So are you trying to dominate your market where you’re going to do a much better job than anyone else for your product and charge less? Now most people always say, like, Oh, I’m always trying to create the best product in the market, like, yes, but are you willing to actually give them the best price and make it absolutely accessible? If you are, you can totally dominate your market. If you look at a perfect example of a company like that everyone knows Netflix, they’re dominating that space, and they offer great product for a great price. And then if you want to have a differentiated product, well, I mean, back to the example of having a very complicated products, you can solve a very niche problem very well. But oftentimes, that product is going to be a little bit more complicated than your typical market dominating enterprise where you can try and serve all customers versus just one customer. And so if you have a differentiated approach, it’s like, well, free trial will make more sense for you. Whereas dominant is going to be more so it can be both free child freemium, you’ve seen both for pretty well, and then it also covers just the ocean condition, like, are you really in a space that is absolutely new? are you creating a new category, if that’s the case, oftentimes, it can work much better, if you have more of a sales that approach to growing your business and a product, that approach might not be the best option right away. Whereas if you look at a red ocean, where it’s really competitive, like even hotter in, whether it’s just the user recordings or heat map space, like it’s, it’s really heating up. And so it’s going to become a competitive advantage to really have the lowest customer acquisition cost possible. And if you have low touch, you can get to that point where you can really enter a market and even offer an amazing price. So your market really matters in that case, as well as Who are you targeting? That is the third part? And so like, are you targeting the CEOs of the company or just the execs? Or are you going to be targeting someone who’s actually going to be using the product, and there’s always going to be a big disconnect, let’s say, if you have a free trial freemium offer doesn’t matter. And you’re giving it to an exec and it’s a really complicated product, that exec probably isn’t going to get too much value unless it’s a really simple product to use. Whereas if you had been targeted the end user, they could have found the product get to the value prop so much easier, and actually made a pitch to that manager to buy it on their credit card. And so the way we buy products, at least within the enterprises is much differently. But you have to understand, like, if you are going to be offering a free trial free and model, you definitely have to really be focusing on the bottom up approach to really growth. And then the last part is just time to value. So the quicker time to value have freemium will make a lot more sense. Whereas sometimes a free trial if it does have a much longer time to value. Yeah, you might want to have that more shorter sales cycle.

Andrew Michael
Yeah, it’s a very interesting topic is on that you mentioned now as well, in terms of like the bottom up approach, I think this is something we’ve again, we’ve spoken about this quite a bit when it came to sort of the land and grab strategy. And typically, enterprise sales is a long winded approach and selling into enterprise prizes could take months to get deals. But some of the most successful companies that actually sell into enterprise are the ones that start with this land and grab. So if we think about zoom, or if you think about Slack, or Atlassian, like these are tools that people might just sign up and start using on their own individually, or they would bring in like a group of three or four people. And because of this low friction, self serve freemium model, they’re allowed to bring people in till it gets to the point where an organisation is saying, Wait a second, we have 20 accounts now, and different teams using us, it’s time for us to get an enterprise plan and pull things together. So there’s differently like a very interesting balance and trying to figure out what works and what doesn’t for your business.

Wes Bush
Yeah, and like, even though then no to especially whenever it comes to time to value, there are cases where it completely doesn’t make sense, if let’s say you have a really long time to value to have a free trial, and it might make more sense to have a freemium model. And so in that particular case, and a good example would be let’s say your product is creating an internal wiki for your business. And so although you might understand the value with the free trial, you can create your first wiki. It’s no different than Google Doc. Like, even if you make it really easy, it’s not that wow moment, where you really understand the value is when you actually start getting 510 1530 people using it, sharing it, and really experiencing the value of that internal wiki for the business. And so there’s always going to be those fringe cases where it’s like, well, like, yeah, it could work. But there’s always sometimes going to be those other fringe cases that it can work. And it really has to be dependent on how people really adopt your product and just monitoring that, like how did they, your best customers adopt your product and kind of go from there.

Andrew Michael
Yeah, and this concept, as well as very interesting in the topic of churn, I think the concept of stored value. And the more things that the more important to system, the more data you have into the more it grows in value over time. And like you said, something with the wiki, which early days, potentially one or two articles not going to be super valuable. But the more they invested into the product, the more they do it, the more store value there is, and the higher the switching costs become. So what might be like a detriment to begin with in terms of a long term value, it tends to be something that can turn out to be very, very sticky in the end. Because people invested time and energy and they bought something that becomes valuable internally. I wanted to ask about the product lead summit now. What was the motivation to put that together? When you were thinking about putting it together? Like how did you go about picking speakers? And was any sort of structure that you wanted the summit to take? So taking people on a journey throughout?

Wes Bush
Yeah, so the product that somehow was started, really because of there is such a gap in knowledge between how to grow a sales organisation versus how to grow a product, that organisation now we can all point at the if the unicorns like slack and Atlassian be like product lead growth works, there we are, just be like them. But there’s a really big gap between be like them, and how do I make this work for my own business. And so whenever I really thought about that, I really just wanted to create a place where people could learn for free, how to do a lot of the things you might not know about how to do for product lead growth. And so in terms of who I recruited, as speakers, I really just wanted to have a lot of operators. So these are not necessarily the people who have the most speaking experience at all. Now, I want to get the people who are actually doing the work and have the insights around how to grow a product that business. And so since its inception and January 2019, it’s really taken off. And it’s really cool just to see how many people are rallying behind product that growth now, and really just kind of figuring out the pieces of how do you truly grow product by business. And as I get more into it, it’s kind of like this wormhole where you’re like, oh, now, the next time I’d like product, lead marketing, we can do product, lead sales product, get support, I’m really kind of take apart each of the big pieces of a product that business and really just find some interesting experts on each of the topics. So yeah, I don’t see this trend stopping anytime soon. It’s just gone faster.

Andrew Michael
It’s crazy. Yeah. And when you say that sort of like product, lead marketing, or product lead sales, like what would you say would be the most critical component to get started within the company? Where would you want to get started with like the shift and moving towards this product, lead growth mindset and operating style?

Wes Bush
Yeah, so the big part is just start the strategy. And that’s really what the majority of the first two summits have really all been about. I mean, even if you look at this, some of those coming on, starting July 22, like 18, at a 52 talks are all focused on strategy. And so that’s really where I’m putting the majority of the weight because there is a really big shift internally that you need to digest as a business. And figure like, oh, like your marketing team has to run a bit differently than a sales organisation, your sales team has to think a little bit differently, like maybe they’re not reaching out to people who downloaded your white paper. And now they’re starting to reach out to people who actually tried the product and got value out of it. So there’s no convincing them of what the value prop is. It’s just saying, like, how can we help you more? How can we serve you not sell you on the product, because if you’re using it by this point, and you’re continuing to use it, there’s a reason why, and you under standard value. And so the organisation has to really kind of shift for every single team to really be product lead. And so that really does have to start at the top. I’ve been in organisations where you try to make that transition from sales lead to product lead. But if people are just not on board at the top, it’s going to be just this huge uphill battle to really get people going.

Andrew Michael
Yeah, definitely, when it comes to these sorts of big fundamental shifts in a business, no way they operate, like if it’s not coming from top down, it’s not going to happen. And I think like talking about product lead growth, it’s definitely one of these the buzz terms that’s floating around lately, but like you rightly put it is it’s it’s not really about the term. It’s just really good business. And at some point, this is going to be the norm. what I’m wondering is like, in today’s day, do we still see companies that don’t start with productive growth Getting Started? So you’ve been talking about companies that are established? And now trying to make the shift from sales lead to product lead? Are we still seeing a trend where companies are starting out with the sales lead mindsets? Or have you seen sort of the shift in the landscape?

Wes Bush
Yeah, so it really just comes down to survival of the fittest in terms of businesses, there are what I would refer to as some really big tidal waves that are coming to wipe out SAS companies. I mean, if you look at some of the data, especially even from profit, well, you see that over the last five years, customer acquisition costs have gone up over 55%. And if you look at willingness to pay, like people just don’t have that same expectation for software anymore, they are not willing to pay a premium for some software features. And so there is just this huge shift, where if you put even to those, those two tidal waves together, it’s like people are willing to pay less, and you’re having to pay more to get those same customers, where’s your margin going. And so if you use a sales lead business model, your customer acquisition costs are expensive, you’re using people to close the deal, and really qualify those prospects. That is expensive. And so if you’re really wanting to survive, as a SAS business long term, you will want to have a product that components your business. And now, even if you are a sales lead right now, that doesn’t mean you have to do the switch all overnight. Now, what many sales life companies do is they start introducing a freemium product or free trial product. And that is a smaller product that it does a really kind of simple part of their whole product ecosystem. And so by allowing them to kind of start off with one of those smaller products, even like HubSpot famous example, with sidekick, when it first came out, you can really start to build that internal team to gain some momentum. And really try like, how can we make this work for our business at a smaller scale before you start transitioning the bigger parts of the product over to that product lead model?

Andrew Michael
Yeah, and really just starting to get a few quick wins internally to build up that motivation. Definitely company. So I’m interested as well to hear like your thoughts then and going into company. So like in hypothetical scenario, you’ve been invited into a company. And you see that they saw sort of a sales lead organisation, churn is really bad within the organisation, and they’ve asked you to come in and see what you can do to try and turn things around for them. And to help increase retention for the company. Like, what are some of the first things that you would look to one to do within the organisation.

Wes Bush
So for that specific scenario, I would just be looking at the people who are signing up right away. And then I’d also look at the people who are staying around the very longest, and the ones who are using the product the most. And so when I would be looking at the people who are staying around the longest, I would just start actually having conversations, I love doing primary research and just trying to figure out, okay, like, what are the features you using? What value what is like the main outcome, like actually show me I know, like this product, does one thing, but show me where it fits into this is this a bigger marketing campaign marketing objectives that you’re trying to really build as a business. And we’re a piece of that, I want to know, like, the bigger context behind my products. And then just really looking through even just user recordings and seeing, like, oh, like, they’re, they’re using this feature, like 10 times a week. Interesting, okay, someone else doing that. And you’re just trying to piece together these patterns and say, like, these people who are staying around the longest, are hopefully we can get to this point, like using this one feature. And I forget, I was talking to David, your see Hi, char And so yeah, it sounds like you have kind of done a similar process in terms of identifying, like, what are some of those key features that people can really if they use them, as they keep coming back. And so once you know, some of those features, you can really start leading with that, and the whole onboarding experience and making sure that people can get to that outcome. And so the reason why also focus on the people who just signed up, is because you want to ask them, okay, like what is the domain outcome that you’re trying to accomplish here? And like, does it line up with what we’re seeing with our best fit customers? And Andrew, from Director of Marketing at whiskey as an interesting way of kind of approaching this initially, like, they didn’t really, they, they knew, obviously, people sign up for whiskey, for seeing videos. And really, they want to host them, but they want to get a little bit more granular, like what is the exact outcome you’re looking to accomplish today, using whiskey and Sarah, in our onboarding flow, they just simply asked people, okay, this is this is what you want to accomplish. And then once you start hearing the same thing over and over again, then you can really start guiding people through that onboarding experience to that key outcome as soon as possible. And so that’s kind of the the two pronged approach that I like to do is focusing on the best fit customers, and then trying to craft that same experience for the new signups so that they can experience those features, too.

Andrew Michael
Yeah. And I like as well that you mentioned that, sort of like asking the users to begin with, but keeping it open ended and not sort of trying to box them into what you think they’re trying to achieve, or what you think they trying to, because I think oftentimes like, and especially when it comes to onboarding, like we cut corners, and we don’t speak to customers, and we don’t allow them to give their voices or so we sort of come up with what we assume are the main use cases are we assume other way that our customers are using the product? But so more often than not, when you actually do something customers that surprise you in really, really interesting ways? Definitely. So how much does customer research impact? product lead growth strategy?

Wes Bush
Yeah, so product research in a product led organisation has to be there, you have to invest a lot more in product research, actually, because it’s not just product like is on this little islands in your company, they’re whipping up these products, and your sales team is selling them. It just doesn’t work that way, like your product team is the core of so many other teams like even your marketing team, like take this example. So marketing, your marketing team wants to generate more leads, just like many other companies, but you’re using a product lead model. So you’re going to try and sit down with the product team and understand, okay, what are the products that we could give away for free? What are some of those things? Because your product, and some of those features are actually driving your costs acquisition model. So there’s this really interesting relationship now with Product Marketing, where you really do have to consider the product into Okay, what can we give away for free? What do we have to ask people to pay for before they can use? What can we let them try out first? And so you have to have that discussion with your users as well as internally to see, is this a good fit, you offer for free, if it’s something that requires a lot of hand holding and onboarding? Yeah, definitely don’t use that as your part of your customer acquisition model to get free users in use something that’s a little lighter touch, and go from there. And so I think product research is just fascinating. Whenever you look at a product like business, because it does have to encompass the marketing side, it does have to look at the sales side and really linking like, what are those behaviours? Maybe in the first five minutes that actually shows up? This is an organisation that is serious about using this product. So it’s worth it for our sales team to reach out in that way, being so much more strategic about who you’re going after?

Andrew Michael
Yeah, and I think what you said now, as well is, is also a very challenging topic. And it’s something I think that a lot of new startups struggle with is trying to decide and understand what to put into a package and what to give away for free and what’s included in the trial. Because more often than not as well like this as guesswork. And do you have any sort of framework that you work with companies to try and help them understand what needs to go in? And what’s too far and what’s not far enough?

Wes Bush
Yeah, and so this is always kind of a balancing act, where you’re going to be looking at your current options that say, on the pricing page, and just seeing like, Okay, what can you give away for free? And there’s a bunch of different research out there that really goes into like, oh, Leah curious how Simon culture nice pricing firm does this, here’s how open view does this. But what you’re going to find through all these different areas of research, is that they all really rely on value metrics. And so if you’re not sure, like what a value metric is, it’s just the the method for how you charge. And so an example would be like, I charge per pair of shoes. So that is my value. Patrick is pair of shoes, if I am whiskey is per video, if I’m Slack, it’s per user. Those are your value metrics. And so as you’re really deciding how you structure, your pricing, and your customer acquisition model, value metrics are your best friends. And it really is helpful just to look through, if you do kind of identify a few value metrics, look through your best customers, the ones who stick around the longest, and really identify like, Okay, what are how many times? Are they using that same value metric? For instance, like, how many users do they have? How many videos do they upload, and it just trying to find a medium of like, Okay, this is a well, healthy customer like this is how many of them they’re using. And maybe if we gave, let’s say, if it’s videos, gave three away, or one or two away, then people could at least experienced the value of a product. And hopefully by that point, they would understand by uploading three videos, that that is the point where it totally makes sense to invest 100 bucks into having as many videos as possible, as well as all these other features. So I really would challenge anyone, if you’re struggling with understanding, like, what should I include in my pricing? Really just focus on your value metrics and try and hone in on what those would be.

Andrew Michael
Yeah. And as well, like you said, it is a difficult balance to try and figure out is like, you want to ensure that you giving enough value for them to realise the value you in the tool, but then also not too much that it comes to the point where your free version is too powerful. And then nobody ends up have upgrade. Yeah, absolutely. Because obviously, at the end of the day, like product, lead growth, and having this mindset of allowing people to try before they buy is really important. And you want to make sure that you delivering the value should be considered purchase it. But sometimes if you push it too far, then you don’t have a business, you just have a free product. So definitely. It’s been great chatting today as well. Where’s that? I want to just ask you one last question. And then we’ll leave it for today is like, what’s one piece of advice that in the product edge strategy that would say is absolutely critical for a business planning to move in this direction to start thinking about? So you touched on strategy a little bit earlier being relevant, important? Like is there some specific parts of strategy or is anything that you’d recommend, okay, this is what you need to do if you want to start moving your organisation from a sales lead to a production company.

Wes Bush
Yeah, and so one of the things that’s really interesting in this space is just so many people are focused on the outcome they want is a business, which is many cases, if you have a free trial freemium model, it’s going to be I want more free users turning into paying customers, I want that conversion to go as high as possible. And so they’re thinking about everything from their perspective, which if you actually want to move the needle significantly, on that one metric from free to paid, you have to focus on your customer, and really just help them become successful in your product. And so even if you have like the worst email series ever, that goes out during your onboarding experience, even if you don’t really guide people too much. But you just help people really understand and use your product and they experience that core outcome that they signed up for, then you are miles and miles ahead of so many other companies, and you will get that free to paid conversion rate to go up. So don’t believe a lot of those silly crap out there. But just focus on helping people

Andrew Michael
focus. Yeah. And a lot when I said is the last question. I have one more. What’s one question when it comes to product lead growth that you wish people more people asked you that they don’t?

Wes Bush
I guess the the thing that I wish more people would ask themselves and maybe myself is just figuring out how you could get more people on board, your team for product lead growth, because I feel like a lot of people think it’s like growth hacking, but with your product. And as it’s not like that you actually need your marketing team to have this product lead approach to marketing, you need your sales teams really think about Oh, like now that we have people in the products, how do we qualify them? We don’t have to do all of the qualification nowadays. And from the sport perspective, like how do we reduce some of these annoying recurring tickets, where it’s a buck in the products, and let’s fix that experience and work with the product team to do that. So everyone has to speak the product, lead language. So the more people you get on board, the easier it’s going to be? So I hope, I really hope more people will just start asking their teams to get on board, because it can make all the difference.

Andrew Michael
Yeah, absolutely. I think specifically when it comes to churn and retention, like product lead strategies, definitely the way forward allowing customers to understand the value before buying has a really big impact in terms of them churning at the end, because what lucky says if you forcing people to purchase a product before they’ve actually experienced the value, the likelihood of them not receiving that value or having a misalignment in what you sell them on the marketing launch your product delivers. It really has a detriment to it. So was it was great having you today. Thank you very much for joining the show. And like I wish you best of luck now as well with the summit, I’m sure it’s going to be a massive success. And best of luck going forward.

Wes Bush
I thanks so much for having me under.