The fastest-growing SaaS companies in recent years didn’t start with a sales team.
Atlassian is a prime example of a company that successfully implemented a product-led growth (PLG) strategy. In fact, the company did not even hire a single sales rep until it reached $100M in revenue!
As these PLG companies scale, to achieve new revenue heights it is necessary they transform into hybrid, product-led sales machines.
Mammoth Growth has worked with over 800 clients, including some of the leading product-led companies such as Calendly and Dropbox. We have noticed a repeatable set of challenges when it comes to moving upmarket and adding a sales motion.
This article explains what the typical hybrid go-to-market strategy looks like. We also provide an action checklist for companies to follow across three key stages:
- Setting yourself up for success
- Bridging the gap between product- and sales-led
- Testing and scaling interventions to maximize revenue
What is a Hybrid Go-to-Market Motion?
A hybrid go-to-market motion involves a mixture of conventional enterprise sales and PLG strategies. In traditional enterprise sales, the product is brought to the user through the buyer. In other words, everything is sales-led.
By contrast, in PLG, the product is responsible for acquisition, retention, and monetization levers within the growth model. Self-serve product usage is at the heart of PLG motion, powering acquisition, and monetization levers. Traditionally, these strategies were siloed, but more and more companies are now using both in their quest for growth strategies.
Introducing a hybrid motion vastly increases the number of potential routes your customers can take before they monetize. As the chart below from MadKudu indicates, you can move from optimizing one potential self-serve funnel to as many as six separate funnels.
Although this can expand the potential routes to conversion for customers, resulting in more revenue and a more effective sales process, it significantly increases operational complexity.
Stage One: Setting Yourself Up For Success
The success of a hybrid go-to-market motion depends on your ability to make the most of each approach. Product-led growth attracts and engages users, but your sales team must convert high-value opportunities. You need specialist tooling for various funnels, and reliable data flows to ensure that your tools are all up-to-date and accurate.
A common obstacle is that sales teams tend to live in Salesforce or Hubspot. While these tools are compelling for traditional B2B sales, they were not built to support the granular visibility into product usage that a hybrid approach demands. On the other hand, pure product-led tools will not fully satisfy the needs of your sales team.
That’s why a new approach is necessary - one that blends multiple solutions, enabling marketers to find revenue signals from all available signups and usage data. Without this capability, sales communications to your critical enterprise clients will lack the personalization and context that is vital for closing deals.
1) Map out your different funnels and understand the tooling requirements at each funnel stage
2) Leverage best-in-class tools for their specific strengths
- Understand what can be done with your existing PLG tool set or equivalents
- Invest heavily in event tracking and product analytics. Not only will this help you track self-serve users, but it also provides a strong foundation for identifying how and when users are moving between funnels
- Select and set up specific tools for your sales team
3) Invest in secure data flows between your tools
- Use a CDP / reverse ETL tool to surface product insights into your sales tools
- Focus on tools that have similar functionality (say, an email marketing tool for your users and an email marketing tool for admin or B2B leads) to ensure optimal user experience
Stage Two: Bridging the Gap Between Product- and Sales-Led
Moving upstream involves much more than simply ‘adding a sales team’.
While there are operational challenges in adding ‘Outbound’ and ‘Inbound’ motions - and the task is quite a departure from what most marketers are accustomed to - the real challenge lies in determining which accounts should receive sales treatment and which should be pushed through the self-serve funnel.
However, this process also reveals the many benefits of the hybrid approach. The trickiest part is ensuring that your potential customers have the right buying journey - and that your sales team has a satisfactorily high pipeline quality. Sales teams are often overwhelmed with low-quality leads, or they do not have enough leads to fill their quotas.
1) Implement a user and lead ‘attractiveness score’
- Define the key firmographic qualities that impact attractiveness (these are typically attributes like the size of the business, ideal customer industry, and ideal customer role)
- Enrich your existing user base. Use tools such as ClearBit and ZoomInfo to retrieve the necessary data
- Build out models that estimate potential contract value
- Define key product engagement metrics that impact attractiveness (typically attributes like usage, frequency, and recency)
- Invest in product analytics to ensure you are capturing this data reliably
- Define a scoring system that balances these factors, for example, a mid-market company that is extremely active in the product may have a similar score to a small enterprise lead
2) Define clear rules for when users and leads are attractive enough for sales
- Decide the ‘attractiveness score’ that warrants sales-assistance
- Build automations that add high-value accounts to your sales tools
- Design and build out automations to dynamically adjust your rules based on sales capacity
- Consider alternate buyer journeys for high-value self-serve users and low-value leads. For example, you might get high-value users to book a sales call instead of self-serve.
3) Look through your user base for further opportunities. For example, you might search for organizations that have multiple subscriptions.
Stage Three: Testing and Scaling Interventions to Maximize Revenue
One of the biggest challenges in growing a hybrid GTM business is managing all the different funnels. After all, each funnel has its own set of interventions.
You might use your CRM tool to drive further user-level product engagement. Or you could use account-based marketing to raise awareness of your product and its benefits among your clients’ senior leadership.
The ultimate goal is to efficiently allocate the "go-to-market" budget and invest in interventions that promise the best marginal productivity for each incremental dollar spent.
However, it is easy to waste money by prematurely scaling new GTM activities without due diligence. Oftentimes, marketers will hire a large inbound sales team without first ensuring that there is sufficient lead velocity to support the additional headcount.
To avoid this mistake, it is important to carefully evaluate the effectiveness of each intervention and scale incrementally based on measurable results.
1) Understand your funnels and conversion baselines
- Map out potential funnels and define when an account enters and exits each funnel
- Establish baseline conversion metrics for each funnel stage and, crucially, time to convert
- Complete this analysis for each customer segment
2) Understand the scope of interventions that can boost conversion rates
- For each funnel stage, strive to understand which actions you can take to boost conversion rates - and estimate how much it will cost to do so
- Build out a list detailing your expected return on investment (ROI) as well as the time to realize ROI for each intervention
- Prioritize the list based on your growth objectives. If you emphasize the enterprise, this typically involves a much longer time to realize ROI.
3) Test it before you scale it!
- Test each intervention to determine its effectiveness in driving conversions for specific user segments.
- Scale interventions when you are confident that they will help you achieve your growth objectives
4) Calibrate your baselines, expected ROI, and time to realize ROI with test data and allocate your GTM budget accordingly.