Your Guide To Outbound & PLG: How To Accelerate Revenue Growth Without Compromising PLG
Product-led growth (PLG) starts with the end user. A healthy PLG engine depends on these users discovering your product through no- or low-cost channels including word-of-mouth, organic search, product virality, communities, and marketplaces.
But as PLG companies grow past $10M annual recurring revenue (ARR), your larger accounts start to drive a disproportionate amount of revenue and incremental growth. These accounts will typically begin their journey with a product interaction before they ever talk to sales. You’ll manage to close larger and larger deals by simply allowing users to opt into a sales-led path or by adopting a product qualified lead (PQL) playbook.
Then folks will notice that there’s still more juice in the lemons. You aren’t capitalizing on all of the potential enterprise demand for your product because you’re either:
- Getting stuck with users: Your enthusiastic users might be unwilling or unable to make the business case to their boss to buy your product. How can you help convince the boss that your product creates real business value?
- Missing opportunities: You might see users churn because their company made a decision to buy a competitor product (Slack versus Microsoft Teams, anyone?) You never knew there was a bigger opportunity to be won because you weren’t talking to the right folks.
- Being siloed in a large org: You might even be successful at convincing a team or a division to buy your product. Still, there are likely many other teams or divisions who don’t know your product exists — and may never know if you don’t educate them.
It’s no wonder that PLG companies contemplate introducing an outbound motion.
Data from PeerSignal.org indicates that a whopping 54% of PLG companies on their B2B Tech Hiring Tracker are looking for sales development representatives (SDRs) or business development representatives (BDRs). This list includes well-known PLG companies like Figma, 1Password, Vercel, and Notion.
PeerSignal.org Co-Founder Adam Schoenfeld explains that while the SDR model was popularized from account-based marketing (ABM) and classic outbound motions, it clearly has a place at PLG companies as well—although it doesn’t look the same. Instead of hunting for just contact information for cold outreach, SDRs are armed with usage data to help identify users or groups that would benefit from paid subscription.
“In some cases SDRs are only engaging with PQLs,” said Adam. “In some cases they support a parallel direct sales motion, and many are a hybrid of both.”
In fact, sales generates almost 10% of new sign-ups even at standout PLG companies according to OpenView’s 2022 Product Benchmarks report. (Since larger accounts tend to pay more, we can assume sales generates more than 10% of new revenue.)
Don’t get me wrong, there are real challenges to going outbound in a PLG company.
- Outbound will increase your customer acquisition cost (CAC) payback, especially in the short-term.
- Outbound will come with potential attribution friction between sales, marketing, and product growth teams.
- Outbound can exacerbate tensions around how much to prioritize PLG efforts versus outbound and enterprise-focused efforts.
To unpack this topic I enlisted the help of Kenny Vincent, global director of sales at ClickUp, and Mara Willemin, director of product-led sales at Trustpage. Read on for tactical advice about how to go outbound without compromising your PLG roots.
What does outbound look like at ClickUp?
ClickUp—“one app to replace them all” including tasks, docs, chat, and more—recently raised an eye-popping $400M Series C at a $4 billion valuation. The product is being used by more than 800,000 teams, representing four times the growth year-on-year. Kenny says that more than 10,000 people sign up for ClickUp every 👏 single 👏 day.
But ClickUp doesn’t rest on its already enviable self-service efforts. The company has rapidly scaled up its sales team in order to generate revenue and realize its vision even faster. Sales at ClickUp includes two different outbound efforts:
A – Outbound that’s part of ClickUp’s product-led sales (PLS) motion
In the PLS motion, account executives (AEs) and SDRs work with accounts that have one or more ClickUp product users. When somebody signs up for ClickUp, the domain is added to ClickUp’s system and any users are added to Salesforce. The PLS teams wait for those users to become PQLs before initiating outreach.
Once someone has become a PQL, Kenny emphasizes that reps need to work the entire account, not just the lead/user. That means engaging with existing users, encouraging those users to invite their teams, but also engaging in pure cold outbound to high value users AND going top-down to complement the bottom-up traction.
Here’s what the sales process might look like in practice:
- Marketing manager at Company A signs up for ClickUp —> domain gets added to Salesforce
- Marketing manager becomes a PQL —> ClickUp rep gets assigned
- The outbound rep prioritizes building a rapport with the marketing manager and encourages her to invite the entire team —> “I’ll train your team on how to use ClickUp for free”
- The rep identifies other executives in the company that align to the ideal customer profile (ICP) -> “Your team is already using ClickUp, would you be curious to see how?”
- The outbound rep works the entire account—not just the marketing manager—in order to catalyze a larger deal —> Use case development, top-down targeting
B – Cold outbound to target accounts
ClickUp has a second outbound team that does cold outbound to target accounts. This looks more like a traditional outbound motion:
- Pull lists, target accounts, and contacts from those accounts. ClickUp targets stronger verticals and looks for contacts in their ICP (ex: executives at mid-market/enterprise companies in engineering, product, or design).
- Use intent information from ZoomInfo and Clearbit (ex: can identify domains that have visited your pricing page, then pull lists of top executives there).
- Run dynamic sequences in Outreach or Salesloft with six to nine touches.
At ClickUp the cold outbound team is relatively small, only ~10 to 12 people. Kenny notes that it takes a longer time for these teams to see traction, generally six to nine months, and so it’s best to start small and then scale. These cold outbound teams are especially challenging to introduce in the current macroeconomic environment.
How the outbound efforts compare
According to Kenny, a 2 to 4% lead-to-close conversion is common for a cold outbound team targeting the mid-market, with a lead being anyone who responds to an email. To put this in perspective, the product-led sales motion sees a whopping 10% conversion from lead-to-close.
What does outbound look like at Trustpage?
Trustpage, a solution to speed up security reviews, is at a very different scale from ClickUp. The company raised a $5M Seed round in November 2021 and has a much leaner team.
That hasn’t stopped Trustpage from testing an outbound motion.
Mara, Trustpage’s director of product-led sales, emphasizes that outbound still plays a very important role in their revenue mix—but it doesn’t look like a traditional sales-led outbound strategy.
She says that at PLG companies “your outbound strategy should utilize the product-led aspects of your user experience to drive value in every touchpoint.” This is broader than simply tweaking your email copy in order to book more meetings.
At Trustpage, outbound efforts focus on driving product adoption of their free version. This is meant to add value to both the buyer (who wants a secure solution) and the vendor (who wants to highlight their security posture to shorten the sales cycle).
“For us at Trustpage, we’ve built an AI-based web crawler that allows us to compare the security policies of buyers’ favorite tools and vendors side-by-side. By sending these compare links directly to prospects at large, enterprise organizations we are providing GTM [go-to-market] teams a resource to drive competitive advantage via security in sales conversations,” said Mara. “For companies who want to update or enhance their information, this drives them directly into our core Trust Center product and kickstarts our PQL journey.”
“While our goal is always trying to drive product adoption, our intention in the outreach is to drive value and create a more trusted security ecosystem in the space, regardless if they use Trustpage to do so or not.”
What challenges should you be prepared for?
From Mara’s perspective, the biggest challenge for PLG companies when going outbound is to ensure that the messaging reflects the product experience your team has created.
“You must go-to-market with the copy of a marketer, the experience of a product manager, and the heart of sales,” said Mara.
You’re looking for the SDR to wear several different hats—an especially big ask for someone who’s typically early in their career. Mara suggests pulling in other members of the team for help with writing or editing the outbound copy.
Mara strongly recommends folks investigate having SDRs either send messages from a different alias or testing the message with the subject matter expert on your team. While this comes up most frequently with developer-focused buyers, it’s more broadly applicable than that.
“It can be helpful for your S/BDR teams to test messaging with those folks before sending, or even have them write the message but have it come from a ‘Trust Advisor’ on your team if it’s being sent to a CISO, for example,” she said.
Kenny at ClickUp notes that it’s important to have separate messaging playbooks for product users versus executive buyers.
- Product user messaging is value-driven, helping you as an individual achieve your objectives and find value in the product.
- Executive buyer messaging is about broader company benefits. There’s a personalized message (ex: “you have five users and they have 150 projects, I’d love to tell you how they’re using the product and benefiting from it”) along with a more traditional outbound message (ex: “you can save costs and consolidate vendors by using an all-in-one platform”).
Then there’s the attribution question: what happens if an SDR reaches out to a prospect who later signs up for a free version or buys via self-service?
Kenny says that some scenarios are fairly clear cut, but others are far less so.
“If there’s a first touch to an executive at a company and then that executive signs up, it’s pretty clear that the outbound generated the sign up,” said Vinny. “Then there are times when someone reaches out and six months later there’s a web form filled by that account, making attribution harder.”
With that in mind, ClickUp’s cold outbound team tends to be more focused on activity-related metrics. The product-led outbound team is more focused on conversion and revenue goals because they have a steadier pipeline of leads from accounts who are already using the product.
Mara urges PLG companies to “treat their buyer experience as the North Star” to guide your attribution decisions.
“Similar to AEs [account executives] in PLG environments, you may want to offer an SDR a smaller commission for driving a product sign-up, and then part of any expansion opportunities within the next six to 12 months. For an SDR this could mean additional commission for a booked demo, or a small revenue share of the booked revenue,” she said.
The TL;DR on outbound and PLG
- Plan for outbound and an SDR/BDR function to be part of your go-to-market mix, especially once you scale beyond $10M ARR.
- Your lowest-hanging fruit is for SDRs/BDRs to work with accounts who are already using the product. They can have up to a five times higher lead-to-close conversion rate.
- Work the account, not just the user/lead. You need to document the use case and get to the decision maker.
- Tailor your messaging to the audience and their product experience. Great product-centric messaging is usually a team sport.
- Treat your buyer experience as the North Star when making attribution and compensation decisions.