The Role of Sales in Product-Led Growth: Expert Insights from Luka Kankaras

Product-led growth, or PLG, is really shaking things up in the business world. It's all about letting the product take the lead in winning over customers and keeping them around. It's a bit like the product doing some of the heavy lifting usually done by marketing and sales teams. But does this mean we no longer need these teams?

Well, it's not as black and white as it seems. PLG doesn't push sales and marketing out of the picture; it just changes how they play the game. This brings up some big questions: Are sales teams still relevant when a company is all about PLG? Is this approach a magic bullet for every business? And if it isn't, how can businesses actually make it work for them?

To get to the bottom of these questions, we're chatting with Luka Kankaras, a guy who really knows his stuff when it comes to PLG. He's leading the charge at Storylane in this area. So, let's dive in and get some real-world insights from Luka on how PLG is changing the game and what it means for businesses today.

Hello Luka! Thanks for joining us. Could you tell us a bit about yourself?

Serbian origin, lived across the world, currently based in Vienna. Working as a product growth manager and a consultant in SaaS for the past few years. Currently, I work as the PLG Lead at Storylane, a no-code demo automation software funded by Y-combinator.

Tell us a bit about your journey to becoming a PLG Lead. What sparked your interest in this area?

I have a background in business and started my career in SaaS sales. Working in startups meant taking on various roles, which led me to growth. A few years later, I noticed the rise of product-led growth and decided to focus on it. I loved the whole idea of the "show, don't tell" approach and using the product as the main growth engine.

What are some of the key responsibilities and challenges you face in your role at Storylane?

At Storylane, I wear many hats. Key Responsibilities include optimizing the conversion funnel, user research, coming up with growth experiments, and tracking product analytics. One of the biggest challenges is the context-switching costs. Without a clear list of daily to-do tasks, it's easy to get distracted and lose focus.

How would you describe a company with a PLG strategy to someone who's new to the idea?

For this purpose, I love to mention Dropbox, as this company is a classic example of PLG. Dropbox offered a simple product that solved a common problem: sharing and storing files online easily. Then, they gave their users a free amount of storage to start with and expected that they would tell their friends about it.

They didn't focus primarily on big marketing and sales campaigns but on the product's usefulness and the users' experiences to naturally encourage more people to come and use Dropbox.

So, to summarize: In PLG, the product itself is the primary driver of customer acquisition, expansion, and retention. This is how it works:

• Find a problem worth solving and make sure your product solves it easily.
• Let people experience it for free, without any gatekeepers or lengthy sales processes.
• Since your product is built to naturally encourage users to explore, adopt, and advocate for it, they will organically move to paid versions for more features.
   

Can any company implement a product-led growth strategy?

I believe that not every company can implement a PLG strategy because that requires a product to be easily understood and deliver value without much external guidance. Some products in certain industries simply don't fit here. However, what these companies can do is add a PLG touch to their offering.

How do they do it? One of the ways is to use interactive product demos and let prospects experience the product without signing up or booking a demo call. This is why I love and believe in products such as Storylane.

What are the critical elements for a company to successfully implement a PLG strategy?

Hmm… The critical elements to implement PLG would be:

1. Product quality, value proposition, PMF. Without a great product that solves a real problem, PLG is useless.
2. Product analytics. PLG relies on data to understand user behavior, and this is necessary for ongoing improvements.
3. Seamless onboarding and UX. The product needs to have an intuitive and frictionless onboarding and UX. Oh, and a checklist doesn't equal onboarding. :)
4. Features that encourage sharing and collaboration to create the flywheel effect.
5. Let people experience it for free, without any gatekeepers (e.g., free trial/freemium).

Can you share a success story or an example where a PLG approach significantly impacted a business?

Yep, right here at Storylane. :)

We implemented a PLG strategy this year and have noticed significant growth so far. This growth isn't just in numbers. We've also seen a deeper level of customer loyalty, as evidenced by positive feedback and increased word-of-mouth referrals and mentions on social media. We are slowly building a strong community around our brand.

How does the role of sales teams evolve in a company focused on PLG? What are the main adjustments sales teams need to make in a PLG-driven environment?

This is a good one. Many salespeople I've spoken to fear that a shift towards PLG might render their roles obsolete (I was there too). However, this is a misconception.

In a PLG-driven company, the role of the sales team doesn't diminish; it transforms.

Product-led sales teams become crucial in complementing and enhancing the user's journey with the product. In the PLG environment, sales teams should start focusing on:

• Consultative Selling: Providing deeper, more strategic insights and guidance to customers, especially at later stages of the sales funnel.
• Data-Driven Upselling: Using product usage data to identify and act on upsell and cross-sell opportunities tailored to the customer's specific needs and usage patterns.
• Customer Success Collaboration: Partnering with customer success teams to ensure that users receive maximum value from the product, which in turn can lead to natural growth opportunities.
   

What advice would you give to companies transitioning to a PLG model in terms of aligning their sales strategies?

In PLG, the goal is not to push the product no matter what but to make users successful. When they are successful, you are successful. With this in mind, my advice is to:

• Understand the product's role. In PLG, the product is the primary growth driver. Sales strategies should be designed to support and enhance the user's experience with the product rather than being the main channel for customer acquisition (Master inbound before outbound).
• Leverage data insights. Utilize user engagement data to inform sales strategies (from identifying which features are most used to understanding customer pain points and recognizing opportunities for upselling)
• Look at the customer success, product, and marketing teams as your best buddies. The goal is to ensure that customers achieve their desired outcomes using your product, which in turn can lead to organic growth through upgrades or referrals.
• Train sales teams accordingly. This includes training on the product, understanding of data analytics, and skills in consultative selling.
   

In a PLG framework, what metrics or KPIs do you find most valuable for measuring success? How do these differ from traditional sales-led models?

In a PLG company, some of the most common metrics are:

• User Activation Rates (% of users who reach 'aha' moments), TTV (time-to-value)-Free to Paid Conversion Rate: For freemium/free trial models.
• Daily/Monthly Active Users (DAU/MAU): Tracks how many users are actively engaging with the product over a given period, indicating stickiness and engagement.
• Feature Adoption rates-Customer Retention and Churn Rates: indicating long-term value and PMF (product-market fit).
   

These metrics show how users engage with the product itself and get value from it. On the other hand, in traditional sales-led models, KPIs are often centered around revenue targets, sales conversion rates, closed accounts, etc.

That was an insightful interview. Thank you Luka!