Alex Bilmes (Endgame): Unifying Product-Led Sales with Self-Service
April 14, 2022
You’ve probably heard companies claim that their products sell themselves. And for product-led businesses, this isn’t far from the truth. Their users are empowered to self-serve—to get started on a product, extract value, and convert to customers—without needing assistance from a human being.
Product-led businesses are dominating the SaaS market. But even despite the massive success of these self-service engines, product-led sales are an essential component of the go-to-market strategy for most, if not all, of the industry’s top performers.
As the founder and CEO of Endgame—a product-led sales platform that helps revenue teams identify which accounts to engage with and when—it’s no overstatement to call Alex Bilmes the godfather of product-led sales.
Alex recently joined Blake Bartlett on the BUILD podcast, where they discussed all things product-led sales–what it means, how to implement it, and what to watch out for.
What is product-led sales (PLS)?
Alex defines product-led sales simply: “It’s just selling to people that are already using your product.”
And it’s quite the divergence from the old-school sales, which requires convincing people to give your product a shot. With product-led sales, on the other hand, your leads are already product users, and your sales reps’ goal is to get them to use more of the product, adopt more features, and expand usage across their organization.
“We have a joke at Endgame which is if somebody signs up, they’re already a customer, they just haven’t paid yet. In some cases, people are already using the product so successfully, all you need to do is ask them for money and they’re happy to give it to you—which is the best-case scenario, of course, but that does happen more often than you might expect.”—Alex Bilmes
Marrying sales and self-service
Creating an efficient and repeatable self-service motion is essential to any good product-led growth strategy. So if users are able to convert to customers all on their own, why do you still need your salespeople?
The short answer: your self-service probably won’t be enough. Maybe you’ll get to 5, 10, or even $20 million ARR, but if you’re really looking to take it to the next level—raising your annual contract value (ACV) and creating a high-velocity go-to-market machine that’s ready to IPO—you’re going to need a sales team.
“Even if you have the most beautiful self-service product of all time, at some point, credit card swipes aren’t going to continue to drive the top-line growth you’re looking for,” added Blake, “You need that foundation—and that’s a really good place to start with self-service. But you need to start layering other things on top of that to move the needle. Sales is one of those things, whether you call it embracing the enterprise or product-led sales.”
All it takes is looking at the examples set by public product-led companies like Zoom, Slack, Datadog (a former OpenView portfolio company), and MongoDB—they all have self-serve products, and they all have sales teams. At the end of the day, if your business wants to close enterprise sales, you’re going to need experienced salespeople. They’re going to be necessary for customers who have more complicated implementation needs, certain business objectives, or need to overcome IT and security objections.
This is where having a seller that is able to build a business case and address security concerns is incredibly helpful, enabling that champion to take the product to their teams internally.
“No matter how you slice it, you add sales on top of incredible tailwinds that you built by having a product that’s incredible enough to attract and retain users—it is just dynamite. It works incredibly well.”—Alex Bilmes.
The rise of the sales assist role
Some product-led businesses have developed a new function—the sales assist role. A blend between sales and customer success, the sales assist is someone who provides proactive support through an onboarding specialist or product specialist who aims to remove blockers in the customer journey.
“If the onboarding specialist is mandatory and users can’t make progress without them, you’re probably doing it wrong. You want users to be able to make progress without them, but they’re available to help on an optional basis.”—Blake Bartlett
Alex reports that at Endgame, the onboarding/product specialist function has been successful with their customer base. These people are available to help customers by providing proactive, personalized support. This may look like sending links to a help center page or even sending Loom videos tailored specifically to the user’s needs.
A successful sales assist role will analyze user successes with the product and see where they need more support. Proactively sharing this kind of content can lead to greater engagement and drive the adoption of new features and use cases in a way that’s relevant to your end users.
The power of usage data
When comparing product-led sales orgs to traditional SaaS sales, “the asymmetry between the size of the sales team and the size of the customer base is just wildly different,” said Alex.
In a product-led SaaS business, reps may be responsible for tens of thousands of accounts. Relying on data is the only way for them to do their jobs effectively.
Sequencing and prioritization becomes so incredibly important. Reps are looking for specific signs that it’s time to follow up, and these signs vary company to company and product to product. According to Alex, reps should be looking for “inflections and anomalies—things that are different.”
When reps leverage product-usage data to qualify outreach, they have a lot more context on the customer than just knowing what whitepapers they’ve interacted with. Usage data is richer—reps know what users are doing, who’s doing what, and where there are usage surges or drops.
“The behavioral data that is so timely—so temporally relevant because it changes so quickly—is incredibly valuable. It’s a huge unlock,” said Alex.
But this data unveils another layer—who are the people in the account that your reps want to be reaching out to? Product data helps reps identify certain behavioral characteristics that are indicative of a particular user being a champion.
“Instead of reaching out to somebody cold, you can actually go to the person who loves your product. You can talk to them and you can get a better understanding of who within the organization you should be speaking to. They might tell you that it’s not who you thought it was.”—Alex Bilmes
Using product usage data in this way makes your sales engine so much more powerful. What it means is that your reps can spend less of their time doing background research for an account and spend more time on strategy. Ultimately, this leads to delivering more value to users with every human interaction.
The pitfalls of product-led sales
Sometimes salespeople come in and close deals that would have closed on their own—not necessarily at a higher ACV. If that becomes commonplace, you’re cannibalizing the self-service side of your strategy.
When product-led sales goes terribly wrong, it can often look like success from the outside. Reps are hitting quota, so you think your sales engine is doing great. Maybe a rep has an 80% close rate and a sales cycle of two months. Those numbers look great until you find out that their average deal size is only $5,000. If they aren’t increasing ACV, they’re just adding to CAC.
There’s another common pitfall for businesses that attempt to layer in product-led sales. They’ll roll out a PLG product and find that they aren’t seeing the kind of response they were looking for, and they’ll try to solve the problem by layering in salespeople. But the issue is often with the product itself. Maybe it’s confusing or not intuitive and is getting in the way of users self-serving. These should be taken as an indication of a change in UI or the development of a new feature—not a new sales hire.
Papering over a product problem with people may help in the short-term, but will not serve the business in the long run. “Leaning too heavily on humans and sales to solve some fundamental product challenges slows growth in later years,” warned Alex. If you find that your salespeople are mandatory in order for people to make progress on the customer journey, then you aren’t doing product-led sales.
Where to start with product-led sales
There’s no denying that when implemented correctly, your product-led sales team can drive huge revenue growth. The question remains: how can founders succeed with product-led sales, and where do they start?
Alex believes that the answer really depends on the stage of the business. In an early-stage business with a bottom-up funnel and maybe a few million in revenue, it can be incredibly valuable for founders to sell a few deals on their own.
“Just start talking to customers and see what it would take to put a deal together. Learn as much as you possibly can about what it looks like.”—Alex Bilmes
Many times, founders will find specific product gaps or deficiencies. Maybe your product needs to be SOC2 compliant, or maybe it’s in need of a particular dashboard or report. Knowing what features are important to buyers is what drives that higher ACV.
At later stages, it may be the onboarding specialists or customer success teams that take on some of the responsibility of selling. They’re targeting accounts where there’s enough momentum, demand, usage, and a self-service conversion has already taken place. This is where you can bring in a more formalized sales team with the goal of turning a set of $5K accounts into $30K or $40K accounts.
If your business is already used to selling in a more traditional way and you want to layer in product-led sales, the key is to start small—don’t boil the ocean. Have a hypothesis, test it rapidly, and most importantly, Alex emphasizes, maintain an open mind.
The problem of implementing product-led sales is often a matter of nailing the product-market fit: “You’ve got two moving targets: the product and the market. Adjust your sales approach or adjust your product,” said Alex.
And as with any good experiment, you’ll need to reduce the number of variables you’re changing at any given time. Take time to learn. Don’t be prescriptive too soon.
“Over-indexing on automation and process-building too early is by far the biggest issue we see,” said Alex. Start by testing just one thing. Test it manually, even if it’s painful. Only then should you add in process and automation.
Five key takeaways
- Product-led salespeople are there to support, not to convince. Trust your product to speak for itself. With a product-led model, your sales reps drive revenue by helping users find new use cases and expand adoption across their org.
- Make room for the sales assist. Customer success, onboarding, or product specialists all present an opportunity to help customers be successful with the product. These personalized and proactive interventions can be used to seriously increase the ACV of accounts.
- Leverage product data to identify behavioral changes and nail timing. Look for inflection points and anomalies in product usage. If reps can reach out as soon as these changes arise, they’re going to meet your users at the point where their willingness to listen is greatest.
- Be careful not to throw people at a product problem. Ultimately, even the best salespeople can’t make up for a bad UI or confusing user experience. When you notice users getting stuck in their journey, first make sure that it isn’t a problem for your product team.
- Start small and experiment. Successful product-led sales strategies require you to refine your product-market fit. This takes time. Run small but rapid experiments to test one variable at a time, and be open-minded when assessing the outcomes.