3 Product-Led Growth Insights from Wes Bush
Author of the bestseller Product-Led Growth, Wes Bush hosted an AMA session on GrowthHackers and answered some questions from our community. As a world-renowned Product-Led Growth pioneer, this article brings 3 insights from his time with us.
1-Growth Hacking vs. Product-Led Growth
To be simple and clear: while growth hacking can be used to grow ANY business, the same doesn’t apply to product-led growth.
By Sean Ellis’ definition, growth hacking is a process of iterative testing with a cross-functional team, throughout the customer journey to find your biggest opportunities for growth. Once you prioritize your experiments using the ICE framework, you should be able to increase the value delivered to your customers (measured by a North Star Metric, for example).
Even if you use the simple AARRR funnel as a representation of the customer journey, when you run a product-led company you need a quick time-to-value and have the right market conditions and strategy for it to work.
“There will always be room for traditional sales-led companies, but product-led companies are unique.”
Before any company decides to go down the product-led growth path, Wes Bush recommends going through the MOAT framework so you can come to your own conclusion on whether it makes sense for your company or not.
The MOAT framework is shown below:
- Market Strategy: Is your go-to-market strategy dominant, discrete, or differentiated?
- Ocean Conditions: Are you in a red or blue ocean business?
- Audience: Do you have a top-down or bottom-up marketing strategy?
- Time-to-value: How motivated and tech-savvy is your audience?
This article gives a full overview of the MOAT framework.
2-How can you leverage PLG
According to Wes Bush, you should start with understanding the three reasons that people buy your product: the functional, emotional, and social outcome.
The functional outcomes refer to the job that customers want to get done. Although people take functional outcome into consideration when buying a product, most companies forget to consider the emotional and social outcomes. The first is how customers want to feel or avoid feeling as a result of executing the core functional outcome and the latest is how they want to be perceived by others by using your product.
“If you don’t know the emotional or social outcomes people are looking for when buying your product, you could be missing out on some serious profitability.’’
Take these two distinct examples:
For Google Ads
- Functional outcome: acquire leads that will turn into customers;
- Emotional outcome: feel empowered to grow their business;
- Social outcome: showcasing a report of your campaign’s performance to your boss.
For a business intelligence tool
- Functional outcome: understand the core KPIs of your business;
- Emotional outcome: the feeling of excitement or surprise as you discover a big opportunity (or threat) for your business with new data;
- Social outcome: sharing a weekly revenue report to your executive team that makes you look like a professional designer and co-workers ask how you put together such an incredible presentation.
“Using this same structure, can you describe the three reasons that make people buy your product/service?”
According to Wes Bush, if you can understand the three main outcomes behind why people buy your product — and execute on it — you’re on the right track to building a strong product-led foundation.
That doesn’t mean that is all done, execution has to be one of your priorities too. Deliver what you have promised, otherwise, your company/product is doomed from the start. The challenge, however, is always in the execution.
3- Inside Sales meets PLG strategy
If you come from a sales background, you’ll probably need someone from the executive to lead the change (if you manage to do this from bottom-up, write to Wes).
According to him, in an oversimplified way, there are two main skills the team-leading should have to head not only the sales team but the whole team to this strategy.
The first is Customer research so you can drive insights on what needs to be solved. The second one is Experimentation, providing creative ways to move the needle in the right decision.
- Do you work for a Product-Led company?
- Do you want to manage your entire growth operation in one software?
- Want your whole team onboard with the Growth mindset?
Try Experiments for free