Deciding whether a free trial, freemium, or hybrid model will work best for your business is challenging — especially as choosing the wrong one could potentially dent your business’ performance.
In this course, you’ll learn:
Wes Bush:
And so, let's touch on the audience because this has a really important impact on whether it is the right time for you to be product-led or not. And so, who are you targeting as a business? Are you primarily targeting buyers or users? So, I want to touch on what is the main difference between these? A buyer is what we've been taught in a sales-led company to go after. They're the decision maker. They're the ones who write the big checks and are going to pay for our solution. The user, on the other hand, in the traditional sales-led company, they just look at them as the person using the product and getting the value. But in a product-led business, we're often targeting the user. And so, I'll go through some of the reasons why this is the case, but it's important to understand who are you primarily targeting? Is it a buyer or is it a user?
Wes Bush:
And so, the big difference here is that if you're targeting buyers, typically, when it comes to acquiring your audience, you're following a more top-down approach. You're targeting decision-makers because they are going to write the checks for your solution. Whereas, if it's bottom up, you're targeting the end user, and they might not have that buying authority right now, but that's who you're targeting, regardless. So, can the buyer and user be the same person, to throw a curve ball through all this? And the answer is yes. And especially, in the B2C world, the business-to-consumer space. And so, I'll give you an example here. Let's say you download Chess.com, the application on Android, and then, after playing about 100 games with other folks, you decide, hey, I'm going to upgrade to the premium version so you can learn how to play chess better.
Wes Bush:
That's an example where the user and the buyer is the same person, and that's pretty darn common when you're looking at the consumer space. When it comes to B2B, though, it's really important to differentiate between the buyer and the user because it's not always the case. I give you a B2B example. Let's say, Sally, she signs up for Slack, invites her team. They use Slack for a few months before other teams start joining the Slack group. When more than 25 people are joining Slack and using Slack regularly, Sally's manager upgrades the team to a paid plan. Why is this important to note? Because if you target buyers, you're most likely going to need to deploy a traditional sales-led approach. Well, if you target users, you're most likely going to need to deploy a product-led approach. And so, the big question to you as you make this transition, a product-led... Well, from sales-led to product-led is, are you going to primarily target buyers or users in the future?
Wes Bush:
Because if you focus on targeting buyers, here's what's going to happen. Even if you go down this route of becoming product-led, is you're going to keep realizing that, hey, as we're targeting these people, they don't necessarily maybe even want to see the product. They want to go through the more traditional demo process. That's not always the case with buyers, but you're also going to be spending more on acquiring these buyers because targeting buyers is actually a lot more expensive from a marketing perspective than it is to even acquire a user who can go into your product, actually understand how to use it, and get value from it, and help people within that organization make the right decision to purchase your solution. So, what do users want? What do they really, really want? And the big thing here, and this is the last piece of the MOAT framework is they want a quick time-to-value.
