How to Create a Winning B2B Product Strategy | Wes Bush | EP 160

SPEAKERS

Christian Klepp, Wes Bush

Christian Klepp  00:01

Welcome to this episode of B2B Marketers on a Mission, and I’m your host. Christian Klepp, today I’ll be talking to Wes Bush. He’s the CEO and founder of ProductLed over the last eight years, he’s worked hands on with more than 400 SaaS companies to help them unlock more than $1 billion in self-serve revenue through product-led growth. He’s also the author of the Product-Led Playbook how to build a product that sells itself. Tune in to find out more about what this B2B marketer’s mission is. All right, Mr. Wes Bush, welcome to the show.

Wes Bush  00:36

Thanks so much for having me.

Christian Klepp  00:37

You know, every now and then I do get Canadians on the show. And it’s always a pleasure, you know, to have a chat about B2B marketing with folks in my neck of the woods. And you know, I say neck of the woods very loosely, because, you know, Canada, short of stating the obvious, is a pretty big country.

Wes Bush  00:54

Totally.

Christian Klepp  00:56

Absolutely. So let’s jump into it, Wes, because, you know, this is going to be, I’m sure, a pretty great conversation. But more importantly, I think it’s one that’s going to be interesting and relevant, right? And if we’re just going to, like, start, I’m going to start with saying that you are on a mission to help B2B companies to unlock self-serve revenue and dominate their markets with tiny teams, right? So for this conversation, we’re going to focus on a topic that is, I would say, near and dear to you, which is how to build a winning strategy that ignites growth. Now I know for some members of the audience that might sound very top level and generic, but we’re going to get into it here, and gonna get into the weeds, and then they’ll understand why we’re calling it that, right? So let’s kick off the conversation with two questions, and I’m happy to repeat, right? So a big part of what you focus on is product-led growth. So why do you believe product-led growth is only half the story, and what should marketers do about it.

Wes Bush  02:00

Yeah, so for product led growth, like if you’re not sure what it is, it is a go-to-market motion where you’ll use your product to acquire users. You can use it to engage those users, to get them to value, also monetize them, and also use it to expand into account. So if you think about like a company, what does that look like? You’ll typically see like a free trial or freemium motion, or something like that, where that’s what the company is using to acquire more people come in the fold. And so from a marketers point of view, like this is really huge, because every single time I’ve worked with a company, let’s say that sales-led, where they just have a demo led kind of motion, and then they launch a free trial, or freemium motion, right off the top same traffic, you’re gonna have like 20 to 30% more people signing up. And it’s nothing like crazy behind the scenes stuff. It’s just like people want to try before they buy. And when we ran the study, we found out actually, 97% of people would prefer to try before they buy versus talk to someone in sales. And so you’ll see that in your conversion rates as well, and everything else like that. So that’s kind of like what product-led growth is, and then why it’s really relevant for marketers to consider. And that’s just talking about one aspect of it, where it’s like from your call to action for your main product. But there’s so many other ways you could leverage product that grows, like powered by x company. You might have seen that like with companies like Drift or Intercom and stuff like that too, which can really fuel growth and help you acquire customers with a very low customer acquisition cost.

Christian Klepp  03:42

Yeah, no, absolutely, absolutely. I wanted to go back to something you said earlier, which I think is very interesting, and I have seen it a lot, right? There’s even reports about that out there. A lot of users prefer to, like, yes, absolutely try before they buy. But they also want to have this I’m just going to say there’s contactless, but there’s also sales-less experience, if that’s even a word, right, which means that they want to try and buy and conduct this research and make an informed decision without necessarily having to have a conversation with that sales person. Why do you think that is?

Wes Bush  04:23

It’s a, yeah, it’s like, why do we think that is, I don’t know. Like, there’s like, goes back to the psychology of like, okay, do you need to do this at the end of the day too? Like, the question I always ask companies, where it’s like, when it comes to sales, is, like, is this person adding value or friction, and a lot of times when it’s like, hey, the only way you can buy from us is if you talk to us and you go through our sales process, like, who has the leverage in that kind of relationship? It’s the buyer, you would think, right? But what’s changed is every single industry right now, especially in the software space, with AI booming and all that stuff too, is never been easier to create a product. So in every single market, there’s tens or hundreds of different options. And so you lost your leverage. If you ever thought you had leverage, you’re like, hey, we’re gonna get people to buy the way we want them to buy. That’s gone out the window, and you need to actually cater towards, hey, this is what buyers want. And I think it goes back to your question of, like, why do people want this? Well, they’ve been probably burned at some point. Like, I think as so many products I’ve personally bought where I’m like, you know, back when I was working on video art, for instance, we were purchasing Marketo, and Marketo is, like, this ultra powerful marketing automation platform. And I was like, on the website, and I was like, Oh, wow, this thing’s so slick. It does so many things. This be great. I’m excited. And then we signed it, and then we got the product login. I was like, Oh, this thing’s complicated. This is going to take a lot of work to just figure out how to set up this tool. And I was like, Man, I thought it was so much easier, better slick, like that marketing side and all that stuff. And so you just have to have one of those experiences to be like, You know what? There is this marketing, sales-led way of building a company. And then it, yes, you can build trust that way. It takes longer. But then there’s this other way of like, Hey, listen, just here’s the keys to the product. See for yourself if you like it or not. Just like, when you buy cologne or perfume, you’re like, Oh yeah, I’m gonna, like, have a little sample of that, see if it smells good, and then you can try it on. And sometimes that’s a completely different experience too. You’re like, smells good in the bottle, but then you put on your skin, like, an hour later it’s either washed off or like, I don’t like that. And so if you want to build trust faster, you have to actually have that product-led experience.

Christian Klepp  06:46

Sounds to me that you want to create a better customer experience, which is actually more surprise, customer centric.

Wes Bush  06:55

Surprise.

Christian Klepp  06:57

Yes, absolutely. No. Totally agree with that. And I think we’ve all had those experiences right, where you didn’t have the opportunity to try before you bought right said product or service, and then when you actually got it, you, for lack of a better description, just didn’t have a very seamless, or perhaps even a horrible experience with said product, and just that cycle of having to go through customer support or get getting some help with a said, like, for example, software that that in itself probably was a nightmare, right?

Wes Bush  07:31

Oh, yeah. And they’re like, Oh man, I’m gonna have to, like, spend all that time learning how to use this. Man, wouldn’t it have been nice if we just purchased something easy to use?

Christian Klepp  07:40

Exactly..

Wes Bush  07:41

It’s like.

Christian Klepp  07:41

Exactly.

Wes Bush  07:42

You realize that you’re like, man, it would have been right?

Christian Klepp  07:44

Yes.

Wes Bush  07:45

But we didn’t do that whole process.

Christian Klepp  07:47

Exactly, exactly. Moving us on to the next question, which is still focusing on this topic of building a winning strategy, right? What are some of these key pitfalls that you think B2B marketers should avoid, and what should they be doing instead?

Wes Bush  08:03

Yeah. All right, so the very first question, like, when I go through like, how to build a winning strategy, it all comes down to like, hey, which market could you become the obvious choice in? Because in any market there’s four buckets you’re going to fall into. The very first one is, like, the scariest, hardest place to be in and get out of, which is just commodity zone. And when you’re a commodity in your industry, everybody’s just saying, hey, like, what’s the best price? What can you do for me? And it’s really hard to stand out and build a sustainable business, because your profits are just slashed. The second kind of bucket, a little better is your contender. And a contender does at least one or two things a little different to break out of the commodity zone land. And so that might be a unique feature. It might be a unique approach, way of doing something, and that is just enough to get them out of that commodity zone. So I can charge a little bit more make a little bit more profit. But you know what? There’s this next group, which is above them that looks at what contenders are doing and likes to copy them. And these are the companies that are on the cusp of their market. So there’s like three to five companies, usually in any market that’s established, and the companies on the cusp, they are, you know, in aggregate, usually taking about, like 25% of the market share, and they are really competitive with each other. But they have built this scale. They’ve built a great go-to-market motion. So they have usually, like a contender. They do one, maybe two things different, but they also have that go-to-market motion, and then there’s only usually one company like the Canva, the industry, the Zoom of the industry, the Slack of the industry, that becomes like this is the obvious choice. And so the like, core tenant of building winning strategy is, where can you become the obvious choice? And in order to answer that, you need to say. Hey, we are the obvious choice for, you know, this market, or this subset of the market who’s looking to do Y, or this specific thing. And I literally just went through this with some other SaaS founders today. And it’s fascinating, because it’s like, let’s not think like big vision here. Let’s think like, the next year. Where can you win? We’re realistically can you become the obvious choice in and even just that exercise alone, it’s really simple, but it grounds you in the reality that in order to stand out, you need to be crystal clear on where you’re going to win and make sure that actually aligns with what are your product’s core capabilities. Who actually cares about that stuff too.

Christian Klepp  10:42

Absolutely, absolutely, I’d like to jam on that a little bit further, if you don’t mind, Wes like this…

Wes Bush  10:47

Yeah.

Christian Klepp  10:48

This whole approach of like becoming the obvious choice in your market. And I know, for probably people outside of Canada, they might not know this, this brand, but there is a brand in in Canada called no name, right? Or it’s basically like no brand name, right? And you can find those in like, No Frills and whatnot. So it’s like, no name baking soda, no name cooking oil, right? And if I understood you correctly, you don’t want to fall into that category, right? So you want people to, like, recognize your name, right? You want your name to be synonymous with good quality, good experience, and so forth. But here comes the question, because you said, become the obvious choice, right in your specific vertical, vertical or segment rather. So how do you, how do you go about doing that? And I know you named some of the steps already, but how do, how do you get SaaS companies to identify that, that segment where they can become the obvious choice?

Wes Bush  11:47

The very first kind of piece of that is the second question, which is like, well, now where do you play best? And this is really hard to do, especially if you’re a product market fit stage, like, trying to identify, like, who is our best users and stuff. What I always say at that stage is like, hey, try out a lot of customers, just as much as they’re trying to try out you see, which use cases resonate best. See what kinds of customers you work best. You get the most energy with. Because there’s something like an unwritten rule of building a company which is like founder market fit. And I actually believe, like, that’s a lot like, more important than product market fit, which is, like, do you actually like these people? Like, for instance, for me, it’s like, I love working with SaaS founders. It gives me energy. It’s fun. I can do this for the long term. Now, product market fit is like, just trying to understand who resonates best with your company and the products you do. So the next step where to play is like, Get really clear on your ideal customer. Now everybody says that not everybody has, like, a way of whittling it down. Now, there’s three factors I really look at to see, like, is this an ideal customer or not? And the first one is motivation. So are they, like, insanely motivated to solve this problem? Whatever your product solves, that should be very high. The second thing is ability, do they have the ability to actually see success in this product, to get it set up? You know, if there’s like, the no name buying chips, it’s like, okay, most people have that ability to eat chips. We’re gonna just put that for everybody. But for a software…

Christian Klepp  13:19

One would assume.

Wes Bush  13:22

Yeah, opening up some of those bags is tricky, huh?

Christian Klepp  13:25

Yeah, sorry, go on.

Wes Bush  13:30

Yes. And where some certain software like it’s hard to figure it out. And so if you give like a marketer, this like technical web development app where you can create your own website. It’s like, you know, is the developer going to be more successful with the marketer? And it’s like, the marketer might be the big visionary, the creative here, but the developer actually would see better success setting it up, at least. So ability. The second thing, the third thing is triggers. So does this person get triggered, whether it’s internally or externally, to solve this particular problem. Now, if you have, like, zero triggers, but you’re like, motivated and ability, it’s like, you know, when they find out about you, eventually they’re gonna be like, Oh my god, I gotta, like, get this right now. But you want ideal users and customers where it’s like, this is pretty frequent. Like, hey, your customer acquisition costs are high, and they keep hearing this from their boss, the rest of their head of marketing, all that stuff, and they have that consistent awareness of this, and so they want to solve this problem. So those three things help you kind of whittle down who are your ideal customers and where you should play best.

Christian Klepp  14:40

Fantastic, fantastic. So motivated, or motivation, rather ability and trigger or triggers, there might be more than one, right?

Wes Bush  14:48

Oh yeah, definitely there should be more than one for your ideal ones.

Christian Klepp  14:51

Yes, yes. All right, I’m gonna move us on to a question where I’m gonna say it’s one of those where you just have to unpack everything. So just imagine your travel in a bag, and you’ve just, you’re just, you’re coming back from a trip, and you’ve got to unpack everything, right? So here we go. In your book, you talk about this approach that you use that’s called the Product-Led system, right? So how does this approach help scale product led businesses and help them become the dominant choice in their market?

Wes Bush  15:22

Yeah. So there’s a lot to unpack here. Definitely. I got my bag. My suitcase is loaded. How long do we have?

Christian Klepp  15:30

Off you go, off you go. As succinct as you can but I know there’s a there’s quite a bit to talk about here.

Wes Bush  15:36

Yeah, totally. All right, so when working with over 400 plus SaaS companies, what we distilled is there’s these nine core components that if you want to build a product-led company, you have to dial these in. And what I learned after building the Product-Led system is there’s actually a strategic order of how you could go about building and scaling your product-led business. And so especially if you’re a marketer listening to this, this is going to be really, really helpful for you to even get in alignment with your founder and rest your leadership team to go through this. Because if they just come to you be like, hey, we want to be product led and get started on that landing page. You’d be like, Well, I had this great podcast. Have a listen to this part and get started.

So the very first kind of phase of the Product-Led system is all about building a foundation that is unshakable when it comes to building your product-led business. Now the first piece we did touch on a little bit, which is your strategy. So what does that look like? And the reason that’s first for building a product business is because at the end of the day, like, if your product led growth strategy isn’t connected to like, how is your company going to win? It usually doesn’t get much legs or resources or support, or you don’t really build the right capabilities on your team to support it really well. Because what happens if you don’t do this is a lot of times, companies will get started with PLG (product-led growth), and then it doesn’t work, and then it’s like, hey, wait a minute. Like this isn’t functioning really well for us because we don’t have the right capabilities. And so that’s one thing we got to think about quite a bit.

Now, the second piece of this, once you get your strategy built out, is you have to understand who is your ideal user. And this is not to be confused with your ideal buyer, your ideal like, the difference between the two is the buyer is the one actually purchasing that the decision maker, whereas your ideal user is the person who’s actually using your product. And so you need to understand exactly who that is. Go through those same three things we talked about, like motivation, ability, triggers, and more importantly, you also got to understand what is ultimate success for this person, like, what’s their end game? What does that look like? And we break it down into like these five main stages, what that goes through like for your user journey. And you got to understand that very well. But even that alone, when you break down, like, I’ll give you an example for marketers, it’s like when you think about the stage in the user journey of just signing up. Okay, what are all the challenges that somebody’s gonna encounter or try and go through in order to sign up? It could be simple things, like, hey, we just have, like, too many form fields. It could be something a bit more complicated, like, Hey, I don’t trust what this site is like. I give you an example, one of our product led clients. Like, they have a company that, basically, if you hook up your AWS (Amazon Web Services) or your cloud servers, they will run all these reports and help you identify, like, hey, there’s these errors here and all that stuff. Now, the biggest objection that the founder didn’t know that was there was that if I give you access to that, like you have the keys to our entire app, everything, if we if, like, something goes wonky here, like our app could get shut down all these, like, scary things. So trust was huge. Now how do we build that? Well, we got to understand, first off, what is that challenge, and then we can come up with some solutions of what that looks like. And so when you know your user that well, you can be like, this, Jedi, of like, Oh, I know you’re struggling with that. Like, here’s the solution ahead of time, and then you actually confront a lot of those objections. And so that’s the second component. Got to understand your user better than anyone else in your market.

Once you do that, then you can finally move on to the third step, which is, what is your free model? What does that look like? The best product companies, they all have a free motion that they lead with, and it’s something you can try before you buy. But the biggest challenge here is most companies are not intentional with it. They just give away something random, where they slap on a 14 day free trial. It’s like, Hey, we’re product-led, yet it doesn’t solve a meaningful problem. It doesn’t lead to a transformation where it’s like, hey, I went from, you know, Wes 1.0 to Wes 2.0 like, when I think about ChatGPT and I started using it, there is a notable difference in productivity, because I can just brainstorm ideas faster. Even writing the book was actually a lot faster, brainstorming so many different ideas, even for the Product-Led system, it was called the product led method before, method before that, then I found out it’s a system. I was like, oh, okay, so like, a lot of these different things that just come out of it.

Christian Klepp  20:30

Thank you. ChatGPT.

Wes Bush  20:34

Sponsored by ChatGPT, so, yeah, that’s the third step, is just understand, like, what do you give away for free? Because you best free motions all have that transformation in common. And so those first three components are all about that foundation that you must have.

And phase two is really all about your go to market motion. So what does that look like? How do you get customers to find out what you do and sign up for your product and actually upgrade. So the core focus for phase two is all about, how do you unlock self serve customers, customers that can just sign up, get the value upgrade without talking to you.

And in order to do that, there’s three things you gotta have. First one is you gotta have an irresistible offer that is something that is hugely compelling for them. You speak to them, since you know your ideal user very well, you’re calling them out. Like, for us, it’s like, four SaaS founders, uh, hello. They’re like, Oh, it’s me. And you actually speak to them, and that’s really compelling. And based on your strategy, you’re also pulling in that strategy into your offer. One of our clients, PromoTix, for instance, they’re going up against Eventbrite, and their strategy to win against Eventbrite is literally two things. It’s like, we’re cheaper, 20 or 40% cheaper. And then second piece is we actually give you really good marketing tools to sell more tickets. That’s it. That was like their strategy. They just mentioned that on their home page, and they saw 40% more sign up, so the exact same traffic. So when you do this right and you have a good strategy, your offer should be a lot more compelling. Not to mention you can also put in that new free offer that you have from the model component, which makes it compelling. So once you get that, you’ll have more signups from the ideal users, not just more signups in general. That’s an important distinction.

And when you have those motivated people signing up, then you can move on to the next component, which is the fifth one, and that’s onboarding, and that is really where you go through. How do we get people to value as soon as possible? And I always say, like the first seven minutes is insanely important because there’s a little pandemic in product led companies, which is 40 to 60% of people will just not come back after that first time. And so you really have to guide people to the value as soon as possible. Now, because you’re smart, because you’ve gone through the user component, you know exactly, okay, what is end the end game for these people? What does that success look like? And you broke it down into every single stage you should know, like, what is the first strike? What is something where, if we get people to this moment, they’re like, aha, yes, I like this product. And then it’s really about in order to do onboarding well, it’s creating the fastest path to get to that specific point. And when you do that, and you get people to value, what I believe, as far as product led companies go, is we’ve done our job. That is a great product led motion. We’ve served before we’ve sold people, we’ve given them value.

But in order for this model to work, we got to actually have pricing and people upgrading. But this is the kind of sixth step, which is we’ve got to go through how to make that easy so it can be a self serve experience, so somebody could look at our pricing page in five seconds understand, like, hey, this is the right plan for me. And there’s a lot we could dig into here, but the main thing I’ll kind of give a shout out on is you need to identify, like, what are your value metrics? Like, if you look at email marketing platforms or sometimes even CRMs (Customer relationship management), it’s, you know, per contact. And if you have 10,000 contacts, here’s the price. If you have 500,000 contacts, it’s it’s a bit more. So you can understand that relationship pretty quick, and that’s important for your product company. So you can start somebody off on, let’s say, a $50 per month plan, and grow it to something like $5,000 per month and but that only happens if you have really dialed in value metrics and understand the pricing side of things. So that’s the first six components, first two phases, anything you wanted me to dive in on or go on?

Christian Klepp  24:53

I mean, this is really dynamite stuff so far, and I’m gonna do a recap once you get to number nine. But, like, there were so many things that you said that resonated. Like, for example, having an irresistible offer, I mean, just a cult Marlon Brando, I’m making an offer you can’t refuse, right? Like, but, um, I think on the topic of onboarding, do you, from your own experience. Do you see that that’s a that’s an area where a lot of SaaS companies struggle. Because, you know, you always talk about churn, and then Customer Success gets involved to make sure that the customers don’t churn. But some, but sometimes, they enter at a little bit later stage of the entire process, and by that point, customers will say, you know what I’m actually done where we’ve actually signed a contract with somebody else, but like, over to you, like, what’s, what’s your experience been?

Wes Bush  25:49

Oh, I think it’s one of the biggest problems that a lot of companies struggle with. One caveat, though, is a lot of times they think it’s the biggest issue, but it’s not. I’ll give you a couple examples. So I was talking to this one founder, and he had a low, free to paid conversion rate, which for many product led companies, like, it’s usually the free to paid conversion rate that drives them crazy. They’re like, It’s low. Why is it low? It’s onboarding. It’s hugely the first thing they come to. Because usually it needs a lot of work. But then in this case, that wasn’t the scenario. So I like heard what he was trying to do to fix the free to paid conversion. He was like, I’m going to spend the next quarter fixing our onboarding. This is exactly what we’re going to be doing. And then I went to his website, I was like, now tell me, what do you do? I don’t understand. It’s something AI enabled. But like, what the heck do you as nicely as possible in my Canadian accent. And so he’s like, Oh, we do this. And I was like, oh, okay, yeah, yeah, I get that. I get what you told me, but I did not get that from your website. So here’s what was happening is he was having people sign up, and they would go through the onboarding and they’d be like, not actually seeing value, because they, one, were not the right people, because he wasn’t speaking to them. Two, they didn’t actually really know what they were signing up for, so they had almost next to zero motivation. And so of course, they would just like, bugger out halfway through, because they’re like, I’m not really that committed. I don’t really understand what this product is, unless you have a lot of extra time. And what was interesting about that too, is he, if he was talking to the people, he would be able to close them and upgrade them. So there was this weird thing going on where it’s like, okay, whatever you’re saying, buddy, it’s important. And whatever you’re showing them in the product is very important too, but when you’re making this self-serve, that’s not quite happening. And then the other most common thing where they think it’s onboarding is somebody signs up for free. They can, like, click around, they can do stuff, but they can’t actually experience any meaningful transformation because they’ve gated it because they didn’t understand, like, from the model component, like, what is something we got to give away that actually gives people a power up in life. It has to feel like there’s the before and then there’s the after of this product. And if it doesn’t have that, if it’s just bland or I just sign up for another app, and now they’re bombarding me with emails and all this fun stuff, and I’ve got zero value. Of course, I’m not going to upgrade, and that was a long winded way of saying there’s a lot more that goes into free to paid conversion rate than just the onboarding. But you are right that most people focus almost too much of their time, I would say, on fixing the onboarding, when the foundational elements before it actually matter a bit more, and just most people don’t think about those.

Christian Klepp  28:46

Absolutely, absolutely, yeah, no, in your best Canadian accent, you mean, like, sorry,

Wes Bush  28:52

So sorry. What do you do? (laugh)

Christian Klepp  28:56

But you mentioned, you mentioned a couple of things, but the one that jumped out at me is part of it, is the messaging, or the way that you package it, right? Because I’ve been on a couple of those websites too, and I scroll up and down. I go back up to the above the fold of the website, and I read through all the copy, and I scroll down again, and I’m like, okay, yeah, still don’t understand. Go back up. And I go through it two times, and I’m like, I still don’t quite understand what the SaaS company is doing, right? So to your point, right? If that’s not clear in those first couple of seconds, right, because you’ve got a you’ve got a window, right, a very short window of time in which to grab people’s attention and to communicate what it is you do and how it benefits them. And if companies can’t do that, you know, you’re going to see a bounce rate. People are going to drop off and won’t have you. But the other thing that you said was the before and after, right? I, in fact, as I was taking my notes, I put like, these massive exclamation points right next to it, right? Because there’s many companies out there. That don’t communicate that enough, right? That transformation that they are not necessarily aspiring to bring what they probably have already brought, but it just doesn’t come across in anything that they communicate.

Wes Bush  30:14

Yeah.. And it’s very common for that. And one thing on the marketing side that, like a lot of people resonate with and think is like, once you hear it, you’ll be like, oh, yeah, that’s true. Sales-led companies can actually have much shorter whether it’s home pages, product pages and all that stuff, that can keep things a little more vague, high level focus around the value prop, but then just get people onto the call, where they can deliver a lot more of those messages. That gets people to understand, okay, this is exactly what it is. This is how you help me. Whereas product led companies usually it’s a bit longer, but that’s why product marketing right now is booming, especially for a lot of product led companies, because it’s a unique capability you have to develop. You got to make something really, really crystal clear, like, what the heck it is? What does it do? How it’s going to enable you? And that can’t just be left up to, oh yeah, we’ll catch them on the call. If they don’t understand what it is, it’s like, no, no, you won’t ever see them. They’re probably going to be anonymous visitors on your website before they even sign up, and you just won’t have a chance or a second bat with them.

Christian Klepp  31:20

Absolutely, absolutely. All right, Wes. We’ve been keeping the audience in suspense. Now, what are the last three parts of that process?

Wes Bush  31:29

So the first one all about unshakable foundation. Second phase is all about, like, unlocking self serve customers. Now, once you’ve graduated at this stage, the last phase is all about, how do we unlock exponential scale? And in order to do that, now that we have the inner workings of a product led motion, with the offer, the onboard and the pricing, now we gotta look at your data and understand where is the biggest bottleneck. We have to understand that at every single week. We gotta know, okay, this is where most people are dropping off. This is where they’re getting stuck. And so the main metrics we look at for a product-led company is number of, like, unique users that are on their website, number of ideal signups. What does that look like every single week? How many of those signups got to, you know, successfully onboard, go through the onboarding setup, and then how many of those people got to what we would consider a first strike, something like tangible first value moment, aha moment, whatever you want to call it. We just like first strike, because it goes with our framework of the bowling alley framework. And then once they get the first strike, how many of those people get to a key usage indicator, which is experiencing the value of the product at least two, maybe three times. And the reason why this one’s really important is because what you’re trying to build here is a bit of a habit, and it’s not just enough to get, like, one quick aha moment. Like, yeah, that was good. We want people to come back again and again and be like, oh, yeah, I created, you know, a new graphic, or something like that. Canva is an example where you’re like, I’m really getting this. And then how many of those people who hit that key switch indicator upgrade? And so with just those simple go to market metrics, there’s a few others, like business health metrics and your north star metric that we also go through. But with that, you can easily find out where is the main constraint of this business is it signups, which is holding us back? Is it, you know, not enough people getting to value which is, like you mentioned with onboarding, it’s actually one of the biggest problems. But what’s unique is every one of those metrics should have a unique owner. And let’s say if this week, you know, you own the metric for first strike, and not enough people are getting to a first strike in the product. You actually become the mini CEO on the leadership team, and you’re saying, Hey, listen, everybody. I know I’m holding everybody back. We got to solve this. I got to enroll your help. And even if other people have high priority stuff on their plate, they have to support you if you need their help, because it’s the company’s bottleneck, and that alignment and that focus around the data side of things creates insane focus, which you need, because if you’re scattered everywhere, you’re like, okay, it doesn’t matter. You know, Christian’s got it, I think, but it’s like, Hey, if you need your help, drop it. Drop whatever you’re doing. This is the main priority, and companies that do that grow way faster. But it’s not enough to just have the understanding of like, Hey, this is a big bottleneck.

The next component, this eighth one, is all about your growth process. So how do you understand like, Okay, if, let’s say first strike is the biggest bottleneck, how do we understand like, we should do this experiment versus that experiment, or we should do that or this, and you got to have an experimentation framework to actually understand, hey, what do you prioritize? What does that look like? And that cadence and rigor really helps build discipline so you’re not just like, oh, the CEO said this idea. I think, yeah, I don’t want to get fired. Let’s do it, meanwhile, you know, it’s a shitty idea, like, it’s like, okay, let’s not do that, but at least you can go to them and be like, is this high impact? Is this low impact? Oh, it’s low impact. Okay, so maybe we don’t do that, and you actually have a process for that.

Now the last component is all about team. Now, the reason this one’s last for a product led company is just by fact that most of the issues that would have arisen with the data and the growth process, you would be able to find a solution with your product, because your product should eventually become in a product led company, your best marketer, your best sales person, your best customer success rep, all those things in one and it’s only when you hit certain problems, like, I’ll give you an example, where it’s like, okay, we, for the last month, have been struggling to get enough signups. We’ve tried all these experiments, but we’ve actually shown a lot of promise with, let’s say LinkedIn ads, believe it or not, and it works. Now we want to scale that up. It’s like, okay, let’s look at a maybe it’s a LinkedIn ad specialist, contractor, somebody on the team full time, and that’s when you can start to look at, okay, we need to bring people into this equation to scale this up, and that allows you to keep a lean team and highly profitable business at the end of the day.

Christian Klepp  36:20

That was a handful. But thank you for distilling it down to these nine points today…

Wes Bush  36:23

I unpacked big.

Christian Klepp  36:26

You sure did, my friend. I think those are probably five suitcases instead of one.

Wes Bush  36:32

Yeah.

Christian Klepp  36:33

But let me just quickly recap this for the benefit of the of the audience, right? So number one is building an unshakable foundation. Second one is, who is your ideal user and don’t come, don’t confuse that with the buyer, right? The third one is, what is your free model, also designing something that solves a meaningful problem, right? Then you get to the GTM motion, or go to market motion. Sorry for the abbreviations, folks. Having an irresistible offer was number four. Number five, which we spoke about at length, onboarding. Number six is pricing, having the right plan. And there’s also clearly some value metrics involved there. And then that last stage, which is unlocking exponential scale, is looking at the data, identifying the biggest bottlenecks and solving them. Number eight is the growth process and having an experimentation framework in place. And number nine, the grand finale, team.

Wes Bush  37:36

Great summary. You got them.

Christian Klepp  37:38

All right, fantastic. Now here comes the next question for you, Wes. So we’ve gone through these nine points of these nine core components in the product led approach. And so for the sake of providing the audience with actionable tips, if there’s somebody out there, like a product marketer, or somebody in SaaS that’s in a marketing role that’s listening to this and doesn’t have 12 months to deliver on results, right? And needs to act upon this right away. What are like three to five things that these folks can do right now to build a winning strategy?

Wes Bush  38:14

Yeah. So the first thing I would recommend for you to go through is just analyze, like, where are you at today on each of these nine components? So we actually built a free product-led assessment, not trying to pitch it here. It’s just super helpful when it comes down to like, okay, what are those specific questions? So each of the nine components we have, like, a question. You can rank yourself from a 1 to 10 on and like, for instance, your ideal user like, Okay, on a scale of 1 to 10. Do you know your ideal user better than anyone else in your market? And I was like, if it’s 10 and 10, it’s like, fantastic. You shouldn’t need to focus there that much. But we all know most people would be like, maybe 7, 6, 4, who knows and based on the order of them. So if your strategy, your user, your model, is low. You have to start there. And although you might want to be like, Oh yeah, our onboarding, let’s focus there. Everything builds off of each other. Those nine components have an order. And so if your earlier components are really weak, the rest of your product led strategy is weak, and there’s no amount of like, okay, let’s just add more people to the equation that’s gonna help. I always say, like, nail the process before you scale it. And that should be true. That’s why it’s the last kind of lever you pull in your business. And so yeah, for many companies we work with, it’s usually like, tightening up your strategy, and then it’s getting a little bit more clear on Who’s your ideal user, so you’re not spreading yourself too thin. And then it’s sometimes like, the model might be okay. We don’t always have to, like, come in guns blazing. Like, let’s switch it, because you’re working with Product-Led. Sometimes it’s just like, Okay, it’s good enough. It’s not perfect, but it’s like, 7 out of 10. So let’s move on to the higher leverage things that are going to actually show that, hey, we made an impact here, which a lot of times that’s your offer as your onboarding or your pricing, because those go to market levers when you go through and implement and improve them, you that’s where you see the revenue at the end of the day, and then the data and process side of things in the product at playbook, I outline some meetings that you should install. So, like, on a weekly basis or a monthly basis, quarterly basis. How do you structure meetings so that you create the rhythm in your company to review some of these things so it’s not static. Like, yeah, we updated our offer last September, I think, is no, let’s review that more frequently and see what we can do to improve that.

Christian Klepp  40:48

Dynamite stuff. Man, dynamite stuff. And absolutely, on the topic of data and processes and having those regular meetings, I think those regular meetings, if you have a fixed agenda and you have fixed goals and objectives, it helps keep everybody accountable. It’s not something that just fades into the ether, right?

Wes Bush  41:09

Totally.

Christian Klepp  41:09

Because people are going to be like, okay, where we’re at, where are we at? What do we need to do? What issues are we facing? What do we need to tackle? Where do we need the validation, the approval? Where do we need support? What are we going to do next? What are the next steps? Wrap up the meeting with next steps, right? Instead of just like, all right. Well, thanks, everyone. Like…

Wes Bush  41:30

Totally. And if anybody wants like those templates too, for like, how to run those meetings. I know we talked a bit about this on our last chat, too, but everybody who’s listening gets the free product led playbook. If you want the audiobook for that, that’s my gift to you, so you can just go grab it at   productledgift.com and then that has the templates as well that you’ll need to actually run those meetings.

Christian Klepp  41:51

Fantastic, man. Fantastic. Christmas came early. Thank you, sir.

Wes Bush  41:54

It did.

Christian Klepp  41:55

Very, very generous. Very generous. All right, Wes two more questions, and I’m gonna let you go, right? So here comes the bonus question. I’ve been thinking hard about this one for a bit, but, um, let’s just say that after this interview, right? The interview wraps up, then suddenly you get a call, and it’s one of these tech billionaires that you that you follow, or that you admire. I’m not going to name names, just take your pick, right? And he says, Wes, you know what? I read your book, great stuff. I’m gonna fund your next SaaS project, whatever you want to do. All right, so here comes the question, if that ever happened to you, what kind of SaaS would you build? And why?

Wes Bush  42:37

Interesting question. Because there’s, like, you know, the highest, you know, hottest kind of ideas you could think of, or the biggest market potential. And then there’s the stuff that I know that would be a great product.

Christian Klepp  42:52

This is the reason why I’m asking the question.

Wes Bush  42:55

I consider myself like there’s the fox versus the hedgehog? Yeah, I’m totally a hedgehog. Man.

Christian Klepp  43:00

Okay.

Wes Bush  43:00

So it would literally just be doubling down on the Product-Led system, turning that into its own software product. Because, like, for instance, with the strategy and everything, after helping hundreds of companies do it, it’s like, I know pretty much, like, what’s a good strategy and stuff like that, pretty quickly. And it’s like, I could train an AI on that and get people 80, 85% of the way there. So yeah, I would definitely just make it way easier and faster to implement part of that system. That’d be my favorite thing to do.

Christian Klepp  43:30

Fantastic, fantastic. Great answer. Wes, thank you so much for your time and for sharing your expertise and experience with the listeners. So please quick intro to yourself and how folks out there can get in touch with you.

Wes Bush  43:42

Yeah. So if any of you want to learn more about product led growth, you can easily find me at Wes Bush on LinkedIn. And also, if you want to learn more about some of the programs we have to help you level up and scale up PLG, you can just check out productled.com.

Christian Klepp  43:56

Fantastic, fantastic. And we’ll be sure to drop those links in the show notes when this episode gets pushed live so once again, sir, thank you so much for your time. Take care, stay safe and talk to you soon.

Wes Bush  44:06

Thanks for having me on.

Christian Klepp  44:08

All right. Bye for now.