If you are founder of a SaaS this days, you know the importance of optimizing your sales funnel to drive growth and revenue. Good old sales may or may not work for you but today’s Silicon Walley darling is Product Led Growth approach. And it quickly becoming the only way. More the half of fortune 100 companies already integrated PLG into their GTM efforts. Customers now expect more — just putting trial or doing freemium does not make you PLG. PLG includes full company alignment and solid data and metrics focused on customer behavior.
The most important metric in PLG is product-qualified-lead (PQL) it enables your team to focus on the accounts that make the most sense for your business.
PQLs leverage product data to correlate user behavior with their propensity to convert, enabling you to be laser focused and target high-quality leads. By implementing a PQL metric, you can improve your team’s focus and deliver a better customer experience. A majority of standout PLG companies who have successfully implemented PQLs see 10%-30% uplift in growth.
However, it’s disappointing to note that recent survey indicates that a large percentage of companies still do not use PQLs. Only 45% of freemium companies and 19% of sales-led companies have implemented this valuable metric.
Ad this is for the reason — building strong metrics culture is not for a faint-hearted, it requires solid data collection and automation. This process can be quite challenging and costly since it requires a significant amount of infrastructure. Starting small with tools like Amplitude can be helpful, but it will not provide enough data to understand the full customer journey from the first contact to the initial product usage up to sales.
To truly implement a successful PQL metric, you’ll need costly infrastructure and heavy data engineering, which is where Customer Data Platforms (CDPs) and Data Management Platforms (DMPs) can come in handy. However, there is a catch. Customization. To iterate quickly, you need access to raw data and tools that go beyond reporting. You need flexibility to introduce new metrics and run experiments with data to iterate on your Go-To-Market (GTM) strategy quickly. And most if not all such platforms will miss true customization, they will sell UX and results. “Hey look here is your customers in one beautiful table ready made, here point and click segmentation for your marketer! And here is our invoice” They offload the burden to you.
What these CDP\DMP vendors are being quiet is that 90% of the customization work still implies good old fashioned !manual! data preparation and data modeling. And yes it’s still the slowest task, taking up a lot of time and often blocking reporting and customer segment creation.
Why would vendors just provide the self-service for it so that business people can do at least some work themselves and analysts will not wait on IT? Well, because providing you with self-service facilities requires millions and millions of investments put into just bring easy and intuitive UI. Believe me it does — I built that one my self. And obviously It’s not what is on vendors roadmap. After all why would they — existence and severity of the data preparation problem is often overlooked by founders and business leaders — so they would never sell this features anyway.
So as a founder, it’s essential to understand the importance of solid data collection and automation and to carefully consider the capabilities of data the platforms you choose. Look for easiness of use, and whether your business people be able to adopt it without difficulty? Ensure it have maximum flexibility and customization so that you will not stack in endless loop of “oh we don’t have that data lets go to data engineers”
Once you enabled your people with data. PQLs will be no brainer for everyone in the company.
Onwards and upwards!
