How to Scale from a Product-Led to Sales-Led Growth Model (with Holly Chen of ExponentialX)

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This is a podcast episode titled, How to Scale from a Product-Led to Sales-Led Growth Model (with Holly Chen of ExponentialX). The summary for this episode is: <p>We've talked about what it takes to implement a product-led growth model at companies, but what about a sales-led growth model? In this episode, Holly Chen, the founder, chief marketing officer, and growth advisor of ExponentialX -- a Growth and Marketing Advisory and Coaching Collective -- takes us through this inverse approach. </p><p><br></p><p>Holly has led growth at companies like Google and Slack and now sits on the boards of fast-growing companies ServiceNow and Workstream HQ. Through all of these roles, she's seen companies go from a product-led growth model to a sales-led growth model, and the inverse. So what makes a transition between models successful? How do you set your team up for success in either model? Holly answers these questions and more over the next 27 minutes.</p><p><br></p><p>Like this episode? Be sure to subscribe, leave a ⭐️⭐️⭐️⭐️⭐️⭐️&nbsp; review, and share the pod with your friends! You can connect with Matt and Holly on Twitter at @MattBilotti and @HollyNY, and the Drift Podcast Network at @DriftPodcasts.</p>
Aligning timing to your goals
02:11 MIN
Handling the grey area of implementation
01:32 MIN
The other investments a sales-led motion requires
03:00 MIN

Matt Bilotti: Hello and welcome to another episode of Growth Podcast. I am your host, Matt Bilotti. And today, I am really excited to have Holly Chen, who is founder, chief marketing officer, and growth advisor at ExponentialX, which all those titles I think are to hit the LinkedIn SEO algorithm for searching. Holly, how are you doing today?

Holly Chen: Great, great. That's a gross advisory hacking. Here we go.

Matt Bilotti: Yeah, absolutely love it. Today, we are going to talk about... So we've talked before about product- led growth on the podcast. We've had some guess that have talked about how to implement product- led growth motion, or how to start with a product- led growth type culture. But today, we're going to take a bit of a inverse approach to it, which is if you already have a product- led growth motion, how do you introduce or scale up to a sales motion? And how does that look? Like what are the challenges? How do you approach the goal setting and metrics and tracking and team set up and all that fun stuff? So we've got Holly here. Holly has a ton of experience in the world of growth. Holly, why don't you give a quick intro on yourself and then we'll go ahead and dive in?

Holly Chen: Yeah. Really excited to be here. Thanks, Matt. I worked on growth at Google on their e- commerce business and Slack and grew it from 100 million to 700 million ARR and eventually going public, so have seen the company scale. And since 2019, 2020, I been advising companies like Miro, Loom, ServiceNow, Sanity, Teamflow. So have seen both companies who have a sales-led motion going down to... wanted to create a product- led growth motion, as well as product- led growth companies wanted to go upmarket to add their sales- assisted and sales- lead motion. So really excited to talk through both of them and compare them and some learnings in the process.

Matt Bilotti: Awesome. That sounds great. So why don't we start from the top. If someone is operating at a company that is mostly product- led, how do they know and how can they think about when the right time is to consider introducing and running a sales- assisted or a sales- led type motion?

Holly Chen: Yeah, this was a million- dollar question. I think there's a lot of talk about PLG. And a lot of people equate PLG as self- serve. But in reality, PLG just mean the product itself is the main driver of growth. So if people need to get some help and start using your product, it can still be PLG. And there are two major ways to add your sales motion, one is sales- assisted, another one is sales- led. So what does that mean? Depending on your product and your audience, a lot of companies who originally have a self-self motion, a typical example is a user. Let's say a engineer or a product marketing manager, they find a tool. They sign up for free, use it for a little bit, likes it, and they may want to have advanced set of features or more control over access levels or security. And at this time, there are two main ways to upgrade. One is self- serve. You go into the product somewhere, you pay directly in the product interface with a credit card. You don't have to talk to anyone to do this, and that's a typical PLG monetization journey. Another one is sales- assisted, which is you contact sales, which comes in the form of a SDR or AE or CSM, really depends on how big you are in your role. And then you may see a demo of the enterprise version or advanced version. You may involve internal stakeholders like securities, privacy, procurement. You ask your VP to sign a contract so you get access to these advanced features or sign an enterprise contract and start using it. So this happens when companies go upmarket from serving SMB to mid- market enterprise because enterprise typically requires more control and more security and privacy requirements. If the advanced version of the product is harder to understand and it needs a little bit of a push or help or education to adapt, and finally, there are security, privacy, and procurement requirements. The benefit of having a sales motion is a higher AOV and longer revenue retention and sometimes more upfront revenue so that your longtime inaudible for that is better. So this is a setup of when does sales emotion comes in? You can go self- serve, you can go sales- assisted, and you can go sales- led. Sales- led basically means sales team plays a bigger role in scheduling demos, negotiating contracts, and often seen in the enterprise sales contacts because it requires longer conversion timeframe and it's a bigger dollar amount. And this is how software have been sold traditionally for many years before PLG was a thing. Now, the question is if the company already have a strong self- serve or sales- assisted motion, would you ever consider sales-led motion? I'd this could be an important part of your GTM strategy because, one, there are certain industries and personas, they're very hard to reach with pure bottoms- up promotion. For example, regulated industries like financial services, healthcare, government services, or certain personas like CXOs at large enterprises. You simply cannot really reach them through a bottoms- up approach. And that's when you have to establish your sales-led motion and do the sing and dance with your target personas. And as a result, how you measure and how you think about success is different. So that's a long- winded answer on when and how do you think about a sales motion. And I can go deeper into, operationally, how do you identify those signals too.

Matt Bilotti: Yeah, amazing. Thank you for the full overview there. You can tell that two things, one, Holly knows what she's talking about, and two, she prepped ahead of the podcast and had really clear answers for stuff. Love it. And one of the very first things that you said that you pointed out was that you can still... Product- led is about how people find value and all that, but you can still have a growth motion and all that with sales, like sales- assisted doesn't mean that you can't be a product- led type company. I feel like there's a little bit of a stigma that as soon as you start hiring people, you can't be product- led anymore, and you lose this aura of greatness that people put around PLG type companies. Okay. So talking through, you talked through when and how it would make sense to introduce emotion. How do you think about like timing, so too early or too late and nailing the timing, and then how do you start? Like do you set a goal to say," All right, we feel like the time is now. Let's set a goal for a year and see where we get"? How do you approach that kind of starting point?

Holly Chen: The timing, really you want to see... It really depends on your product and audience, and it's not necessarily," Oh, once you reach a certain ARR, or necessarily like let's plan 12 months ahead." I would say for fast- growing companies, you want to identify signals. And the signals comes in mainly three ways. One is your demographic, two is your activity, and three is your CSMs. Firmographic look into your existing users and see what kind of companies they're coming from, what's the size of the company they're coming from, what's the persona or titles or similarities of your users. And if you start to see more and more of larger companies or more senior roles using your product, then that's a positive signal. And two is activity. So if you observe a surge of visits to your pricing page, or if you see a particular company all of a sudden adding new users, and especially interesting, what I've seen is if there are different users from different geos, especially for bigger companies and they are more distributed and if you have different geos, that means, okay, a positive signal that a bigger deal may be in the works and that they're more interesting to identify. Of course, you want to work with your analytics team. Maybe you use the tool in game to identify those signals, so activity. And third one is CSMs. For PLG companies, as everyone knows, CSMs is super important in making sure your customers have good experience. And a lot of times these more qualitative signals really comes from the conversations with your customer service representatives and managers. So stay close to your CSMs, and success team can give you some interesting signals to identify when it's a good time.

Matt Bilotti: Yeah, that part of CSMs is so important. The CSM team at Drift is generally the first group of people that I turn to when I need to either invalidate or get some starting validation for an idea, a product release, an experiment, whatever it might be. They are a wealth of knowledge because they're so close like you were saying. Okay, so let's say we see some signals, if I'm starting a sales-led or sales- assisted motion, how can I think about goaling and team mission and team structure? Who do I hire? When do I hire? What's my metric? How do I think about that?

Holly Chen: Yeah, ultimately, your goal is to have more revenue. And then it comes down to conversion rate and your NDR and et cetera. So you want to set the goal of what's the additional revenue and revenue growth you want to drive versus motion and plan out your resources and really understand the ROI of this effort because it is a very involved process. And like you said, the team structure will be different, how you measure is different, the goal is different. So I would recommend, especially for companies who're just starting to think about this is use an experimental approach, just like any growth hacker and growth practitioner would do is you pick a segment. It can be an industry segment or a persona or a geo that has decent volume to give you a signal, but maybe that segment has a slower time to close or lower conversion rate. And you can cut this in various different ways. You can cut it as controlled and exposed, like part of this geo has a sale- assisted motion and how will the geo doesn't, or it can be pre- post, and of course, if you don't have enough of volume. So you want to run in parallel, not to change everything together, but run in parallel and compare your controlled- exposed, or pre- post in order to say," Okay, do I actually see a material difference in adopting the sales- assisted motion?" Another way you can run an experiment is to direct part of your traffic to the sales- assisted flow. Like all the new users, you separate out, let's say, 30% of your traffic to a flow that requires people to get through the sales- assisted flow and see if there's any interesting signals out there. So run smaller experiments to get signals to get started. In terms of hires from the marketing side of things, your PLG companies, typically your existing team has experience in high velocity, high volume type of growth motion. They probably have a B2C experience, or has more of experience from companies like Slack or Loom or Trellos of the world versus is if you have a sales- assisted or even sales- led motion experience from more of a demand gen B2B led type of company is very valuable. So you want to add demand gen resources that have previous experience in driving personalized targeted campaigns. You want to make sure you have a solid customer marketing person so that you can work very closely with a team on customer stories, on customer advisory boards, et cetera. You'll probably need your events and field marketing team to grow bigger because more personalized events is going to be a motion. Marketing ops is an important one because now you start to adopt a whole different set of tools and systems and measurement. So that's a huge part. And finally, but not least, the product marketing and content marketing is key because your product marketing initially for PLG is probably more horizontal, like you have your segments more industry- based or persona- based, but now your product marketing needs to communicate a different set of values. Why a buyer would care about your product versus why a user would care about your product. So that's a whole different set of messaging. And subsequently, your content marketing needs to change because now you have to start creating white papers, thought leadership, and more sort of, on topics, the decision makers will care about.

Matt Bilotti: Awesome. My next question was going to be around how you think about channel mix changing as you introduce sales motion. But it sounds like you covered most of it in that answer. Do you have anything else to add to that?

Holly Chen: Channel mix is very much... I would say there's similar channels and then there's additional different channels. So similar channels, maybe previously, you run like Google campaigns and Facebook campaigns, you'll probably continue to use these vendors, but your approach and strategy will be different. The kind of keywords you target or the kind of lending pages you create is going to be different. And then you probably add more targeted platforms and channels that for PLG, it may be too expensive to run. And the casing point is LinkedIn. A lot of times if you run a PLG in high velocity and high volume type of motion, LinkedIn is going to be too expensive to use versus if you are running a Legion and B2B like a top down motion, then LinkedIn is very targeted and is one of the best channels to use. And then there are ABM platforms like 6sense, Demandbase, Triblio, Terminus, RollWorks, Engagio, Metadata, Apollo, ZoomInfo, all of these platforms really help you to identify who's visiting your website, how do you personalize your landing pages, how do you get signals of intent in order to run your ABM campaigns.

Matt Bilotti: So one of the things that I like to dig in on in this podcast is the messy parts of implementation that I feel like get overlooked in blog posts and whatnot. So let's say somebody is in this motion now, they identify now's the time, here are goals, we're going to do an incremental and experiment- driven, we have a sense of who we're hiring and in what order. How do you think about handling that in- between gray area before the whole thing is fully fleshed out and proven where executives might look at it and say," Why are we introducing this? We've been doing it for a few months. It's super expensive"? Doubt starts to set in. And I know some of it is... You have to set expectations because the timeline for that sort of sale is going to take longer and recognizing the revenue might take longer and driving the marketing efforts might take longer. But how do you think about that messy interpersonal team level stuff?

Holly Chen: Yeah, yeah. Like you said, setting expectations and overcommunicate is the key. I think using experimental approach to this is important. If you run an experiment of control- exposed and you start to compare, but not compare in a two- week timeframe, but compare in like let's say this quarter, we're going to start getting some signals, whether this may work. And the signals doesn't have to be close one because maybe your conversion to sales window is 30 days, 60 days and maybe longer, and maybe a quarter is not enough to get that signal, but maybe the signal is a little bit forward to say," Well, how many people actually clicked on the button to contact sales? And what's the average order value of similar companies who contact us via this channel? And do I see a lift in the percentage of companies in my mix of small, medium businesses versus large enterprises?" And then if you use a proxy of past lifetime value to predict the value of the type of leads and the type of companies that you are actually reaching, then that can get early signal to say," Okay, is this ROI positive potentially?"

Matt Bilotti: And in terms of one of the other parts that get a little messy when you're running both completely product- led motion and some sales- driven is attribution. I know attribution can get a little chaotic in that world and handling it and setting up the systems for it. How do you think about attribution?

Holly Chen: Yeah, attribution is... I think everyone wants to figure it out, but there's no standard answer. And it's a mix of art and science. I always approach this as, one, you want to benchmark pre- post and control- expose. This is essentially a incrementality study if you run these experiments. So you know," Okay, how much of a lift, the actual incremental lift that I can attribute to this new motion." And two is at the back end, one of the key challenges I see people running into is how much do I attribute to the self- serve funnel if I add the sales- assisted motion? Especially if there are two teams running these two motions, it's like," How much do I give to the self- serve team? How much do I give the sales- assisted team?" And everyone is running the ROI analysis. So one way to do this is not to say," This is a standard," is to say," Pre- sales- assisted motion, what's the gross trajectory of pure self- serve? And then you may have a curve. If the revenue goes in a different trajectory, then you attribute the incremental portion of that additional revenue to the sales- assisted team. So that could be a nice compromise to say," Okay, pre and post, and what's the incremental?" And for certain industries and personas, it's more about access. It's more about the ability to be able to reach. So it's beyond incremental revenue, then it's like," I couldn't have reached the CIO of JPMorgan Chase if I didn't run these sales-led motion. Then you can measure that as a standalone program to say," What's the additional..." Then you run almost to your equivalent of a P& L for the sales-led motion.

Matt Bilotti: Yeah, makes sense. There's no perfect answer, but you could find ways to cut up and... It would seem to me like one of the most important pieces of setting attribution around it is just getting alignment by forcing everybody to agree," This is how we're going to measure it because I've seen it happen where, all right, let's move forward with this." And then one team moves forward with an attribution model and then this other team is like," Hold on, I didn't agree to that." And then all of a sudden it becomes this chaotic battle.

Holly Chen: Yeah. Yeah, sometimes you just say like," Let's put a sticker on the ground. We have no perfect answer. No one has perfect answer. Let's just say let's start with this. And then in six months as we have more data, let's adjust," because your mix of customers change, your go- to- market motion change, and you get more signals on the value of this motion.

Matt Bilotti: Makes sense. When you zoom out and look at whether it's companies that you've actively advises process or companies that might be doing it on their own, we talked about this a little bit of you might have to invest in new types of operations people, or obviously if you're introducing sales- led or sales- assisted, you're going to need sales managers and all that. When you look at the full picture of introducing a sales- led or sales- assisted type motion, if we haven't touched on them, what other types of investments does a company need to think about that are either directly related or might be a little bit more indirect?

Holly Chen: Yeah, for sure. So we covered the marketing side of things. And what I did mention is brand marketing. If before I'm mainly targeting end users, and if I can get efficient performance marketing campaign out in order to acquire high volume of users, I'm good for a while. But if you want to go upmarket, then the trust is very important, the brand is very important. You may want to start thinking about investing in how do I craft a brand story and brand campaign that really speaks to the needs and wants of the enterprise decision- makers, which has a totally different type of mindset and what they care about. So that related to the brand piece, your brand marketing people, your design, and your media is going to be a big requirement and then operations. Like I said, there's a whole different set of tools and data, so you may need to invest more in data engineering, sales operations, and marketing operations to make sure your data is fed correctly into different systems because now you have your large volume of end user data and then you have your very highly targeted, this set of decision- maker committee data, and you have different sets of tools that meet these demands. Sometimes the high- volume tools are not enough in terms of feature set to track things, or if you only use, let's say, HubSpot of the world, it may be too expensive to host all kinds of millions of records of user data. So you want to make sure these two systems talk to each other and being able to connect the dots between them. So the data side of requirements is going to be big. And of course, there's engineering, design, PM leads. Now, not only your back end needs to change because you will need to develop more accessibility features, privacy controls, and admin features, but also on the front end. Your website is going to change, your flow is going to change, your life cycle marketing needs is going to change. So the subsequent support of email systems and notification systems is going to change. So it's not a small fee to take on.

Matt Bilotti: Yeah, there is a lot to consider there, but you've done quite a wonderful job breaking it all down. Is there anything else around this topic that you wanted to touch on that we haven't had a chance to cover at all?

Holly Chen: This is probably not a very conventional observation from the advisory work I've been doing. I noticed a few companies started experimenting high- velocity sales emotion and really try to compare because like in Silicon valley, we always talk about automation. Automation is always better than human touch. But actually if you can use high- velocity SDR motion to convert your leads in a quick motion, your SDR is not going to cost that much necessarily, and you'll probably close higher AOV deals that retains longer, and you'll probably be able to explain your features better for them to adapt. So it's not necessarily more expensive to have a human touch. A few companies started to experimenting with high- velocity sales. Not only my advisor clients, but actually also some larger companies started to do that and it actually has a very positive signal. And I talk to a lot of, let's say, Chinese companies because human cost is a lot lower there and a lot of companies use high- velocity human touch to run it. So I think my approach is always not necessarily say one is always better than the other, but using more experimental approach to run experiments and really see if this motion is better for my business or not.

Matt Bilotti: Awesome. All right. Well, Holly, thank you so much for joining and talking through all this stuff. I learned a ton and your answers were clear and concise and dense, like there's a lot in there, and I know our listeners for sure had a lot of takeaways. So really appreciate it.

Holly Chen: I really enjoyed it. Thanks, Matt.

Matt Bilotti: Absolutely. And for those of you listening, there are many, many other episodes, I think almost like 80 others with amazing guests that you can go check out. If you like this one, hit the Subscribe button. If you got feedback, ideas, whatever it might be, my email is matt @ drift. com. If you could leave a review, that would be amazing as well. Thank you so much for spending your time listening to this podcast. I know there are hundreds or thousands of things you could be working on listening to, reading, whatever might be, and you're spending it here listening to the podcast and I super appreciate it. So thank you very much, and I will catch you on the next episode. Bye.


We've talked about what it takes to implement a product-led growth model at companies, but what about a sales-led growth model? In this episode, Holly Chen, the founder, chief marketing officer, and growth advisor of ExponentialX -- a Growth and Marketing Advisory and Coaching Collective -- takes us through this inverse approach.

Holly has led growth at companies like Google and Slack and now sits on the boards of fast-growing companies ServiceNow and Workstream HQ. Through all of these roles, she's seen companies go from a product-led growth model to a sales-led growth model, and the inverse. So what makes a transition between models successful? How do you set your team up for success in either model? Holly answers these questions and more over the next 27 minutes.

Key Moments:

  • (2:33) How to know when it's the right time to transition from a product-led to sales-led motion
  • (8:26) Aligning timing to your goals
  • (11:26) Hiring towards your goals
  • (16:21) How Holly thinks about channel mixes in both models
  • (19:00) Handling the grey area of implementation
  • (20:56) How Holly thinks about attribution
  • (24:58) The other investments a sales-led motion requires
  • (28:19) Perks of a high-velocity sales motion

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Today's Host

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Matt Bilotti


Today's Guests

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Holly Chen

|Founder & CMO, ExponentialX