paint-brush
Beyond Checklists: How to Add Outbound Sales to Your Product-Led Growth (PLG) Motionby@alitaa
859 reads
859 reads

Beyond Checklists: How to Add Outbound Sales to Your Product-Led Growth (PLG) Motion

by Isioma OgwudaMarch 9th, 2023
Read on Terminal Reader
Read this story w/o Javascript
tldt arrow

Too Long; Didn't Read

Product-led growth is not enough for you to dominate the market. Viral growth loops and self-serve can only get you so far. For major traction, you need an outbound sales team to navigate revenue growth and expansion. Outbound also helps to speed up sales cycles, particularly for bigger deals.
featured image - Beyond Checklists: How to Add Outbound Sales to Your Product-Led Growth (PLG) Motion
 Isioma Ogwuda HackerNoon profile picture



In 2012, Kenyan athlete Abel Mutai was leading a cross-country race in Burlada, Navarre. As he approached what he thought was the finish line, he slowed down to celebrate. But, there was one problem: he was wrong.


Spanish athlete Fernández Anaya caught up with him and, using creative gestures, guided him to the finish line.


Like this story, product-led growth is not enough for you to dominate the market. Viral growth loops and self-serve can only get you so far.


For major traction, you need an outbound sales team to navigate revenue growth and expansion.


Beyond the Product: Why Outbound Sales is Important for PLG Success

1– Retention and Growth


Companies often start by building a bottom-up motion, where people adopt their tools. But this works until the company grows to a certain level. There's a good chance that a CIO, CEO, or CFO won't buy $100,000 ARR contracts on a credit card.


They need to consider things like SLA requirements, master services agreements, and tier upgrades. This is where your sales development team comes in to pull the strings. Their role is to identify the need for formalization and build the necessary process around it.


It’s a major reason why the typical PLG company layers in top-down sales when they hit $25–50 million in annual revenue. SaaS superstars such as Slack, Zoom, Airtable, and others are proof of this.


PLG data is an effective way to find product-qualified leads that would benefit from a paid subscription or enterprise deal. Because users may love your product, but need help convincing their coworkers or getting a budget approved, especially if the bill exceeds their credit card limit.


In other words, higher costs mean more decision-makers and obstacles.

2 – Accelerated sales cycles

Outbound also helps to speed up sales cycles, particularly for bigger deals.


Comtura CEO, Hector Forewood, says, "We went all-in on PLG when we launched Comtura. We focused on marketing content, generating awareness, and promoting our product. We got 2+ inbounds every two weeks, which grew to 4+.”



But this was not enough to generate a return on investment or hit early milestones. The problem was long sales cycles.


It would take 45–60 days to get to full team penetration. The land-and-expand strategy didn't work because users wouldn't commit to a commercial agreement.


Considering that Comtura’s solution was bottom-up, there was nothing in it for users. The ACVs on those contracts were small, in the ballpark of $4K–$6K. To solve this problem, they added direct sales. And sales engagements have improved since they switched.


Now in control of the ACV, Comtura would engage with the buyer, access the required information to run pilots based on the assumed value, and then build the use case. This has reduced Comtura’s sales cycle to 30 to 45 days, Hector explains.

3 - Stronger Relationships

Kate Ahlering, CRO at Calendly, says the company follows a hybrid approach. While product-led growth (PLG) is key to acquiring prospects, sales drive revenue and expansion.


‘Calendly leverages PLG to feed the funnel, while sales targets end-users with influential titles within the core use case they serve. Such end-users might include the VP of sales’.


Calendly uses customer conversations to improve, build relationships, and close more deals.

How to Mix PLG and Direct Sales the Right Way


While PLG and direct sales make for a potent go-to-market combo, there’s still an appropriate way to ensure your company can make the most of them. Here are a few tips for maximizing their value in your context.

1– Identify and Segment Product Qualified Leads

Create scoring models based on product data. Begin with detailing your ideal buyer persona and how they use your product.


Crucial metrics to keep an eye on include:

  • Daily active users (DAU)
  • Usage frequency
  • Time spent
  • Conversion from free to paid
  • The number of invites sent


If you don't have access to the necessary data, consider using a data enrichment tool like HeadsUp to enhance Salesforce or HubSpot functionality.


Let’s illustrate this with an enterprise account with a capacity of 1,000, but only 200 users. If you want to reach 80% penetration, your outbound team needs to add another 600 users to that account.


Reps can use data to spot high-potential leads and gain crucial insights into power users and highlight key conversion indicators.


According to GTM strategist, Steve Ruiz, it’s advisable to segment all enterprise visitors, and instead of a free demo or related PLG experience, direct them to sales.

Sprig implemented this strategy and experienced a 67% increase in enterprise conversions.

2 – Get Your Pricing Right

It’s best to offer individual, team, and enterprise-specific pricing plans. The goal is to get your core users to see the value of an enterprise plan without losing them.


Your sales team needs enough of a wedge to sell enterprise accounts on the added value without building a barrier to current customers.


Consider what extra value you can offer with an enterprise plan. This includes dedicated customer support or other enhanced features.


How Nick Atrey Approaches Outbound

Nick Atrey is quite vocal about his outbound strategy. At Loom, he followed a virtual whiteboarding startup. The company's IT team upgraded 400 people to Loom's business plan, entirely organic and without the involvement of sales.


Nick’s role was to figure out which of the 400 buyers in that business plan were using Loom the most and why. He reached out to them and conducted interviews. The twist was, instead of trying to sell them the enterprise version, his tone was,


"Hey, you are the expert. You are using Loom. Would you be open to helping me?"


This approach proved to be more effective than peppering them with a long list of features or trying to start a conversation about enterprise.


Notice that he approached them about the problem they were hoping to solve with Loom. After talking to 10 people, including a product manager, designers, and customer success staff, Nick leveraged this narrative to call the IT VP to share his findings.


The outcome?


The VP responded, and the call converted into a deal.

Is Outbound right for you?


Consider going outbound when:


  • Your product has reached double- or triple-digit ARR through a self-serve model.
  • Top-down sales can be a force multiplier, meaning organic expansion levers are effective and you have penetrated accounts.


By combining product-led growth and direct sales, you’ll close more deals and build strong customer relationships. And if things get bumpy, the sales team can pinpoint and resolve customer issues.


Now you have a proven way to win the market, keep customers, and grow your bottom line.