The Science of Scaling
How to Add a Sales Org to Your PLG Company w/ Dino DiMarino (CRO, Snyk)
Wed Jul 05 2023Description
The episode discusses the importance of product-led growth (PLG) and the implementation of PLG strategies in sales organizations. It explores the benefits of PLG, the challenges faced by startups transitioning to PLG, and the role of sales in unlocking the value of a product in enterprise settings. The episode also delves into the balance between inbound and outbound sales, the specialization of sales reps, and the evolution of PLG sales strategies. It concludes with insights on successful traits for enterprise reps and the disruptive potential of PLG in go-to-market models.
Insights
PLG Benefits and Challenges
Product-led growth (PLG) offers efficiency, rapid scaling, and great product telemetry. However, attributing value to freemium users remains a challenge for many companies.
Implementing PLG Effectively
To implement product-led growth (PLG) effectively, hiring knowledgeable people, collecting useful data, and constant education are key. Enriched PLG data can enhance account-based marketing, and avoiding sales pitch bombardment is crucial.
Balancing Inbound and Outbound Sales
PLG companies should consider multiple routes to market beyond just inbound. Cold calling integration should be treated as an experiment, and the opportunity stage in PLG requires discovery, qualification, and tailored demos.
Specialization and Growth in PLG Sales
Specializing account executives based on appointment sources does not have a clear advantage. Hiring profiles for sales reps may differ based on their curiosity and interest in understanding PLG. As the brand develops, the difference between cold appointments and PLG appointments becomes less significant.
Evolution of PLG Sales Strategies
As a brand develops, the difference between cold appointments and PLG appointments becomes similar. The complexities of specialization are no longer justified as the company grows. Different acts of acquiring customers involve humanless acquisition, inside sales teams, and selling million-dollar deals to Fortune 100 banks.
Traits of Successful Enterprise Reps
Successful enterprise reps need to have a healthy level of paranoia and humility. Building relationships with technical and business executives, having multiple contacts for negotiations, and leveraging experience are crucial for closing deals.
Chapters
- The Importance of Product-Led Growth (PLG)
- Implementing Product-Led Growth (PLG) Effectively
- Balancing Inbound and Outbound Sales in PLG Companies
- Specialization and Growth in PLG Sales
- The Evolution of PLG Sales Strategies
- Traits of Successful Enterprise Reps
The Importance of Product-Led Growth (PLG)
00:00 - 07:06
- Dino D. Marino, the CEO of SNEAK, discusses the importance of layering a sales organization onto product-led growth (PLG) plays.
- PLG refers to providing freemium products and allowing users to acquire the technology at a small to medium scale.
- Indirect benefits of PLG include personal use cases and exploration in different industries.
- Companies like Atlassian, Data Dog, GitHub, and GitLab have proven that PLG can be successful but may require additional sales and marketing strategies for scalability.
- It is important for startups to explore PLG early on as transitioning from sales-led growth to PLG can be challenging.
- Layering a sales organization on top of PLG is necessary for creating a true company with expanded go-to-market and marketing capabilities.
- Relationships and guidance from experienced individuals are crucial in unlocking the value of a product in enterprise settings.
- Direct benefits of PLG include efficiency, rapid scaling, and great product telemetry.
- Attributing value to freemium users remains a challenge for many companies.
Implementing Product-Led Growth (PLG) Effectively
06:49 - 13:38
- The indirect elements of freemium users can have significant benefits for a company's demand funnel.
- The marketing team emphasizes the intangible value of brand building and sustainable moats in the software and tech industry.
- A leader who embraces product-led growth (PLG) is crucial for unlocking its potential possibilities.
- Hiring knowledgeable people, collecting useful data, and constant education are key to implementing PLG effectively.
- Enriched PLG data can enhance account-based marketing by providing context and creating a better customer experience.
- R&D organizations often experience excitement when PLG funnels generate high user adoption rates.
- Bombarding customers with sales pitches should be avoided, especially when there is scarcity of pipeline.
- The implementation of outbound motion in addition to inbound PLG focus requires adjustments over time.
Balancing Inbound and Outbound Sales in PLG Companies
13:10 - 19:41
- The company has adjusted its approach to outbound prospecting by involving corporate velocity and growth reps.
- Initially, the sales organization was inbound-centric but has evolved to find a balance between inbound and outbound.
- It is important for PLG companies to consider multiple routes to market beyond just inbound.
- When integrating cold calling into the sales team, it should be treated as an experiment and run for at least two quarters before relying on it for revenue targets.
- The opportunity stage in PLG is similar to sales-led organizations, with discovery, qualification, and tailored demos still being important.
- Customers often need to catch up with the product's full premise even if they have already educated themselves on some aspects.
Specialization and Growth in PLG Sales
19:15 - 25:56
- End users often have limited knowledge about a product, even if they have adopted it.
- The sales process at the opportunity stage is similar for both end users and buyers.
- Specializing account executives based on the source of appointments (cold call or PLG funnel) does not have a clear advantage.
- HubSpot experimented with inbound and outbound reps for SMB and mid-market business, but the reasons were not solely based on different buying processes.
- Hiring profiles for sales reps may differ based on their curiosity and interest in understanding PLG.
- Enterprise sellers sometimes have a one playbook mentality, which may not align with a company that values PLG motion.
- SMB sellers are more open to learning about PLG and see it as a lever for their business growth.
- In the beginning, specializing salespeople based on appointment sources can help understand different channels effectively.
- As the brand develops, the difference between cold appointments and PLG appointments becomes less significant.
The Evolution of PLG Sales Strategies
25:38 - 32:27
- As a brand develops, the difference between cold appointments and product-led growth (PLG) appointments becomes similar.
- The complexities of specialization are no longer justified as the company grows.
- A pivot was made from inbound/outbound SMB growth to having a traditional SMB rep on the hunter side.
- Act 1 of acquiring customers for PLG companies involves humanless acquisition and generating revenue through low-cost trip wires.
- Act 2 involves introducing an inside sales team to bring in mid-market customers.
- Act 3 focuses on selling million-dollar deals to Fortune 100 banks and expanding enterprise relevance.
- Enterprise reps need to understand the political dynamics of organizations and develop strong champions.
- Paranoia and humility are important traits for enterprise reps, who must build bridges with skeptics in large enterprises.
Traits of Successful Enterprise Reps
32:01 - 35:10
- Enterprise reps need to have a healthy level of paranoia and humility to market to skeptics in large enterprises.
- Having a vision like a founder is important in understanding the initial opportunity and navigating stakeholders.
- Good sellers know how to build relationships with technical and business executives throughout the sales process.
- Having multiple people who are willing to take your call and make negotiations easier is crucial for closing deals.
- Experience and mileage help enterprise sellers stay calm and focused on tough objectives.
- PLG (Product-Led Growth) is still in its early stages with disruptive potential for go-to-market models.
- Successful unicorns follow the playbook of layering on go-to-market strategies without losing their magic.