There’s a lot written about the advantages of product-led growth (PLG), how it keeps marketing and sales costs down, how customers prefer it and so on. All good, but I struggled to find much on the actual strategies to use – how do you do it?
There are obvious things like having a product with amazing product-market fit. But that doesn’t really help with strategy – it’s not particularly insightful, and it is, of course, the task that vast parts of your org will be working towards – what do the customers want? What is the market? How do we iterate towards their needs? And so on and so on. Let’s assume you’re doing all you can in that direction.
How can you help as a marketing department? Well, there are lots of tactics: focus on inbound work, build a community, make sure the CTAs are in the product (to help people from product-usage to getting in touch), design trials properly to that people understand the value. Fundamentally, you’re trying to use the product and usage of that product as the channel.
But I wanted to focus on one specific strategy that has been pivotal at Redgate, about the messaging and tone you use with customers – and it’s something that is (sadly) pretty rare in the world of marketing. By definition, most PLG is targeting users of your product, and there are specific ways in which you need to change the way you interact and message to this sort of customer.
It’s an enormous over-simplification, but the process for PLG, runs something like:
- Through some mechanism, a new user finds your product,
- User tries product, loves it, buys it,
- User tells colleagues, friends, everyone about how great your product is. Go back to step 1!
The question is, how do you amplify this cycle? Can you catalyze this, or do you just need to let it run its course?
The “trick” we’ve found most effective for messaging is “Under-promise, over-deliver”. And you can see how that runs counter to the standard marketing mindset.
To see why this approach can be so effective, firstly ask yourself – as a user/consumer yourself, how many times have you bought or tried something – either in a work or personal context – and been disappointed? For me, this is (sadly!), the standard process for making purchases: you’re sold something based on a promise, and over a period of time you realise that it’s not quite what you hoped for. Whether it’s a piece of MarTech, a meal out, a new laptop, an agency’s services, whatever – our general experience is one of disappointment.
But here’s the “trick” – where this hasn’t been the case, where a product is genuinely at least as good as the promise, if not better, then these are the times, and the only times when I’ve recommended that product to someone else. Going back to point (3) above – the process of recommendation or word-of-mouth is the fundamental driver of the product-led growth model (from a marketing perspective).
Take a specific example. You’ve been asked to market a new piece of MarTech, say a chatbot system. You’ve got a good product, it’s better than most of the competitors, and you’ve been tasked with implementing a PLG strategy – you want to build the business from the bottom-up. You’ve now got two choices:
- Extoll the virtues of this thing – tell customers that every user will love it, it does everything the competitors do and more and that it will “Transform your business overnight, doubling your customer base, as they all start buying from you, because of your wonderful chatbot facility”. Or,
- Something with a little humility. Be clear about the scope of impact a chatbot can have – “Help your customers interact with you in a way they prefer”, “Lower your support costs by 15%”, and so on.
Option 1 is fine if you just want the initial sale, and don’t care too much about the ongoing word-of-mouth process. Do you care if that customer decides to recommend it to friends and colleagues? Perhaps not.
But if you do care about these things, option 2 is the better strategy. Why? Because, taking the product functionality as a given, the individual is far more likely to go through a process of:
- Let’s try this product,
- Wow, this is better than I thought! I was really ready for disappointment, but this is way better than expected!
- I’m going to buy it. But more than that, I’m going to tell others – it’s so rare to find a product that’s better than expected, it’s worth mentioning it!
..and so the virtuous cycle begins. Of course another key point is that end-users do tend to be more skeptical of OTT marketing messages. So it’s a welcome relief to those individuals when they finally get a vendor that is straightforward with them, even to the point of humility.
There are many examples of this out there – companies where the product is genuinely better than the marketing message would imply:
- Redgate – I would say this, but it’s been our strategy for 20 years. And it works – Word-of-Mouth is still our strongest source of leads.
- Apple – my experience of Apple products, is that they repeatedly surprise you (in a good way!), with features and usability that you didn’t expect.
- Assassins Creed video games – one for the gamers, but these titles are always, for me, better than I expected. They don’t tell you everything you’ll be getting, you find this out yourself through game-play.
- SouthWest Airlines – the website makes it feel very standard, but anyone who’s ever flown with them will know that the experience is a long way from this. Always a pleasure to fly SouthWest (I can’t help recommending them!). I just hope they get through the current crisis intact.
- Brancott Estate lower alcohol wine – the label makes it look really average and “Supermarket-ey”. But it’s an amazing wine with only 9% alcohol. I must have recommended it to 10 people already.
So why doesn’t everyone market this way? Because there is a tension between immediate sales and long term growth – and taking this approach, of under-selling yourself – requires some faith. And you’ll be asked by your colleagues, “Really, that’s the best you can say about this?! Aren’t you a marketer!?”. So you have to hold your nerve a little, and take some risk. Of course one way of de-risking is to try and measure WOM recommendations over time – are you getting leads in, seemingly from nowhere? If you ask customers “Why are you looking at our products?” and you get something like “A colleague told me about it”, then it’s a good sign that you are on the right track.
Because of course when it does work, it’s one of the lowest cost and most effective marketing strategies there is. It just takes patience and sometimes nerves of steel.