Product-Led Growth: Enabling Sales to Scale Your Success
Product-led growth (PLG) is leading many B2B companies to drive rapid revenue success. While PLG solutions can propel organizations forward efficiently, this approach also brings specific and complex challenges of its own. If your company is aiming to scale revenue, your cross-functional team may already be considering shifts to go-to-market (GTM) distribution efforts and strategies. What do successful sales leaders prioritize to align their sales organizations accordingly?
Segment’s tremendous growth and acquisition by Twilio for $3.2 billion, is an example of what it takes from companies as a whole to scale PLG success. John Kaplan recently caught up with Segment’s Chief Revenue Officer Joe Morrissey. During their conversation, Morrissey talks through what their organization focused on as they complemented their product-led growth approach with value-based sales methodology.
The Product-led Growth Era
Morrissey shares his thoughts on the product-led growth era, highlighting the benefits and challenges this approach can bring to company leaders looking to scale their business. You may find value in his insight on how company leaders can prioritize and invest in go-to-market enhancements to drive ongoing revenue and growth.
A Clear Need to Improve Buyer Alignment
When looking to scale the business, Segment's leaders identified clear opportunities to improve the efficiency of their go-to-market approach and increase sales' ability to retain and expand customer accounts. Morrissey shares, “Segment had driven significant product-led growth, we scaled to multiple millions, and had an engaged customer base. We saw tremendous growth that was led in that fashion, but by the time I joined it was clear we had to make significant investments in distribution, and in Sales and Customer Success, to ensure that that growth continues.”
During his first 90 days at Segment, Morrissey did extensive research, holding interviews with stakeholders across the organization, including board leaders, C-suite officers, as well as front-line managers and sales reps. What he and Segment's cross-functional leaders discovered was that their buyers were often changing inside customer companies, creating a massive shift for the sales team when it came time for renewals and expansion. During their conversation, Joe Morrissey and John Kaplan discuss those shifts and share valuable takeaways for leaders in similar situations:
Enabling the Sales Motion to Drive Ongoing Revenue Success
Segment's leaders focused on implementing a scalable way to enable the sales organization to operate in a different manner with customers. Morrissey notes, “What we needed to do was align our solution to our customers’ and prospects' biggest pain points. We needed to get clear internally on what those pains are. What are the negative consequences of those pains? What are the outcomes our customers are trying to achieve? What are the required capabilities to achieve those outcomes? That’s where the Value Framework became so critical for us. It gave us a common language, not only to talk internally about the problems we solve for our customers but to talk to our customers about their problems.”
Segment's leaders focused on building and operationalizing a consistent Value Framework that would play two critical roles for the company as a whole:
- First, the framework provides a way to align internally, as a company, around Segment’s business value and competitive differentiation.
- Second, the framework provides a way for the sales team to repeatedly drive meaningful conversations with buyers.
Implementing a Value Framework to Capture Alignment with Their Buyer
Segment’s leaders participated in workshops that enabled them to align cross-functionally on the value drivers and differentiators that are top-of-mind for their most influential buying audiences. This alignment laid the foundation for a Value Framework that is completely customized to Segment’s sales approach and buyers. Of the process, Morrissey notes, “Getting that alignment across the company is not an easy thing to do. But the Value Framework is such a critical part of that. It doesn't work unless everyone is bought in. It gave us really clear focus and alignment, it was really impactful.” Here are some key characteristics of the Value Framework, if you’d like to dig deeper.
The value-based methodology they created provided Segment’s board, C-suite leaders, and customer-facing departments (Sales, Marketing, Product, Customer Success, etc.) with a common language to talk internally about the problems they solve for their customers. Segment’s customer-facing organizations now leverage the Value Framework to ensure their go-to-market actions are aligned with and relevant to their buyers. Here are a few examples of how Segment’s organization leverages the framework:
- Sales can repeatedly drive meaningful conversations with buyers around their business problems and map to the right solutions to improve customer outcomes, retention and expansion.
- Product is able to align their roadmap according to what’s most important to their buying audiences and prioritize product improvements in a similar fashion.
- Customer success can execute smooth handoffs from sales, which reduces customer confusion after deployment, simultaneously minimizing the need for product engineering support on the backend of projects.
How Supporting the PLG Approach Drove Revenue Growth
Segment’s sales organization has seen a 150% increase in annual recurring revenue (ARR) over a two-year period. The company’s ongoing success and rapid growth have garnered the attention of the marketplace. Generating cross-functional alignment on their solution’s business value and operationalizing that alignment with a consumable framework supported Segment in scaling their company's PLG success. Learn more about their story and how you may be able to operationalize a transformation initiative that drives similar, significant outcomes for your company.