by Alec Beard
Product-led growth doesn’t mean product only growth. Even if your SaaS can acquire, onboard, and create a loyal following of new users all on its own, you’ll eventually find yourself at a crossroads. You can either adopt a sales-led motion or watch your growth curve plateau.
Here’s what you should know to launch and scale an effective product-led sales team in your own company.
Why You Should Introduce a Sales-Led Motion
On average, 16% of product-led growth (PLG) SaaS employees work in sales. That number can skew up or down depending on your growth stage, company size, and the unique context of your business, but it proves one thing—product-led companies need sales.
But why? If the whole point of adopting a product-led model is to allow your product to drive growth, what’s with the inflated sales headcounts?
While PLG is great at creating opportunities downmarket, it struggles to meet the needs of large enterprise accounts. An enterprise customer can’t just sign up and start throwing money your way—they require custom pricing, packaging, and one-on-one support. With a talented sales team, you can drive growth through deal expansion and upselling, improve free to paid conversion of new users, and offer a better customer experience for prospects overall.
Social media management platform Hootsuite is a perfect example of a company that had to adopt a sales-assisted model to scale. In a conversation with Massimo Chieruzzi, former GM of Ads at Hootsuite, he told us, “When we sold to Hootsuite, we were at $6M+ ARR and still didn’t have a single sales rep!” Today, with over 1,000 employees, Sales roles make up 12% of Hootsuite’s total headcount—that’s a pretty big leap.
What to Consider Before You Get Started
A dedicated sales team could be the key to scaling upmarket and closing deals with massive ACVs. But before you start publishing JDs for new sales members, here are a few things to consider.
PLG is all about the end user.
Product-led growth rose in popularity because of its user-first philosophy. So, before you scale your sales operation, ask yourself: “What’s the best way to communicate value to my users”?
Sometimes it takes a human touch in the buying process to convert prospects who are on the fence. If your SaaS has APIs, additional features, and other potential add-ons that customers aren’t taking advantage of, Sales employees can communicate their value and ensure you’re getting the greatest ROI possible.
What other resources can fill the role of sales?
There are several reasons some product-led companies have managed to get by without a dedicated sales team.
One of those is content and community engagement. Take Bubble, a no-code software development platform used to build mobile and web applications. In lieu of a sales team, Bubble provides prospects and free trial users with loads of resources, including:
- A community page to showcase user projects built with Bubble
- A public marketplace for templates, plugins, and software development agencies
- An online academy to teach the fundamentals of app development in Bubble
Instead of relying on an Account Executive or Customer Success Manager, Bubble uses content and community outreach to influence and educate prospects. As a result, sales employees only make up 4% of Bubble’s total employee headcount, and most customer acquisitions are driven via self sign-up.
Sales headcounts won’t look the same at every product-led company.
PLG leaders like Canva and Atlassian don’t require huge sales teams, even at their size. Canva truly embodies the product-led approach, with Sales employees only making up 2% of their total workforce. On the other hand, DocuSign has a whopping 35% employee sales headcount.
Both companies are product-led and offer free trials, but it’s the need of their end-users that determines what the role of Sales looks like.
For DocuSign, sales reps are needed to negotiate pricing on items like feature add-ons, additional products, APIs, custom branding, and enterprise support. Whereas with Canva, everything a user would need is already available in-product, and sales members are on standby to negotiate custom deals for global and enterprise accounts.
Find alignment between your sales and R&D departments.
There’s a common cliche in B2B SaaS: sales promises a feature to close a deal, product scrambles to add it to the roadmap, and development is left to make sense of it all. Introducing an aggressive sales motion could disrupt the delicate balance of a previously established product-led ecosystem.
Finding alignment between your new sales and R&D departments is a necessary first step when transitioning to a sales-assisted model. In a worst-case scenario, sales could push the product roadmap towards larger customers to land higher ACVs and increase their commission returns. Over time, eager sales reps could alter your product roadmap so much that it starts to feel like you’re managing two different companies.
To avoid this, many sales-assisted PLG companies focus on expanding deal sizes with existing customers vs. performing aggressive outbound sales.
Be thoughtful about sales compensation and operations.
How you compensate your sales team directly influences how they engage with prospects. When you’re first rolling out a sales-led motion, you don’t want your sales reps chasing commissions on accounts that aren’t ready to convert.
Instead, consider implementing a “commission-free” compensation plan at the early stages to test what accounts respond best to sales engagement. A commission-free approach allows you to experiment quickly with your sales processes and optimize the funnel before scaling your sales efforts.
A standard commission plan can be reintroduced after you’ve drafted an effective sales playbook through trial, error, and experimentation.
Is product-led growth replacing the traditional sales-led model?
Download the guide to find out.
How to Add a Sales-Led Motion to a Product-Led Business
Study your funnel and account data to identify qualified prospects
In PLG, prospects who are still in the early funnel stages won’t be great targets for your sales reps.
Qualified sales prospects can be found by studying your current funnel and account data. If you’re struggling to convert customers above a certain employee headcount, this might be a good sign that sales assistance is needed to close deals. Similarly, if you have accounts that could be paying more for your SaaS, sales teams can re-negotiate pricing and packaging to deliver greater ROI.
Another effective prospecting method is to identify which of your customers have experienced the most “in-account” growth—this could be through purchasing add-ons, upgrading to a higher service tier, or increasing product usage. Identifying these accounts will give you insight into similar customers that might respond positively to sales engagement. This way, instead of waiting for in-account growth to occur organically over months or years, you can take a proactive approach and accelerate deal expansion by introducing a sales-led motion.
Confirm that sales positively impacts growth
Before launching a full-blown sales initiative, you need to validate that sales reps can move the needle and prove ROI.
In a product-led model, sales should be:
- Increasing free to paid trial conversions
- Shortening time to close
- Improving average deal sizes
- Expanding deal sizes with existing customers
However, to hit these KPIs, you need to rethink your sales processes. Because product-led growth focuses on serving the end-user, aggressive sales outreach could overwhelm individual prospects who are still early in their buyer’s journey.
Instead of outbounding, consider adding a “contact sales” form on your plans/pricing page—this allows prospects to self-select a sales-assisted buyer’s journey. Similarly, inbound sales is another effective way to introduce a sales-assisted model. In this scenario, your sales reps would follow up with product-qualified leads (PQLs) to upsell and monetize high-value accounts.
Create a playbook for sales engagement
Every great sales team has a playbook. To succeed at product-led sales, you’ll need to rethink the traditional “smile and dial” approach.
In a product-led model, sales reps need to be consultative—their primary job is to help existing customers build a case to purchase feature add-ons, upgrade to a higher subscription tier, or transition to an annual sales-negotiated contract. So, instead of cold calling and running through a demo, sales teams will act as a support function—similar to a customer success motion.
To identify these prospects, look for users who have filled out a form, asked a question using in-app chat, requested to use a high-value feature, or sent you an inquiry via email.
How Pricing Impacts Product-Led Sales
Product-led growth has gained traction in SaaS because users want more agency in the software buying process. Now, SaaS buyers expect simple sign-ups, self-service onboarding, and the option to pay how they want.
Even if you have great product/market fit and a talented sales team, you’ll struggle to capture demand if your pricing options are limited. Flexible pricing and billing models make it easier for product-led sales teams to optimize offers for revenue growth and close deals. In other words, it could make or break your PLG efforts.
Want to build a PLG-friendly pricing strategy that aligns with how customers use your SaaS? Download our guide to learn how product-led growth is impacting the future of B2B SaaS, and how you can create a hybrid go-to-market strategy for your company.
Is product-led growth replacing the traditional sales-led model?
Download the guide to find out.