Marty Labelle is the chief technology officer at Assent, a leader in supply chain sustainability management.
getty
Product-led growth (PLG)—a strategy that prioritizes delivering on user needs and letting products lead sales conversations—has emerged as a key approach for businesses looking to create resilience during difficult market conditions. For example, certain technology companies like Zoom flourished during the global pandemic by delivering reliable products that put users in the driver's seat of the buying process.
By focusing on product innovations and user experience, technology firms can sustain revenue growth and minimize cost per acquisition. Most importantly, they can chart a course to success while overcoming external headwinds.
However, the traditional PLG model can be improved. If businesses aren't diligent, it can lead to tunnel vision on "the next big thing" or developing a shallow solution that chases after quick wins. While product developers should be responsive to market changes, they must focus on delivering an exceptional product with long-term growth potential. Otherwise, companies become vulnerable to market disruptors and can be easily replaced by competitors or artificial intelligence tools.
Long-term value and product resilience can only be achieved through a user-centric approach to PLG that taps into clients' entire user ecosystems for business intelligence, not just the purchasing decision makers at the top tiers.
Developing A Proactive And Resilient PLG Strategy
When technology leaders evaluate their PLG approach, they need to distinguish between users and buyers. The user base represents a broader ecosystem containing all customer use cases. Buyers represent a smaller fraction of that ecosystem with more purchasing power but more specialized use cases and, typically, less hands-on time with the product.
Buyers may be the gatekeepers, but the user ecosystem has a much more tangible impact on a product's successful implementation, adoption and long-term staying power. Businesses may onboard a new product only to see it fail during the implementation phase because it didn't have buy-in from the users. This can lead to contracts not being renewed, general user dissatisfaction and harm to an organization's overall growth and reputation.
Taking a more user-centric approach to PLG can reduce the risk of churn, build greater customer trust and make companies more resilient to market disruptions. User-centric PLG can also create more resilient businesses because it encourages proactive solutions development to meet user demand even when market forces that drive buyers cool down.
If a PLG strategy is strictly reactive and tied to factors outside of its control, the ability to innovate slows when the market does. By pursuing a user-centric PLG instead, companies can have a constant source of user data and business intelligence that can reveal insights about where their products can grow to generate profits.
How To Begin Mapping The User Ecosystem
Part of what makes a user ecosystem so valuable is the depth of data it provides. The user ecosystem can tell companies about user sentiment, where their products are lacking, how they are used and how the product performs in the real world. As with any type of data, user-ecosystem analysis requires a systematic approach.
Here are some ways technology firms can get started with tracking data from their user ecosystems.
Build User Personas
Companies can't measure their users without a deeper understanding of who they are. To gain this level of insight, user personas must be developed.
The ecosystem includes everyone with a job to be done with the system or a job that requires output from it. For example, include staff members who input data, managers reviewing that data and making decisions and individuals who communicate the data internally and externally.
For each of these types of users, create a user persona detailing their job(s) to be done, obstacles and goals. This can enable companies to gain insights from their raw user data. Without this context, it is difficult to design new products or capabilities that bring value to specific user goals.
Capture Data From Multiple Angles
Because the user ecosystem is complex and deep, data collection should be multilayered and combine expert interpretation with automated data collection. That means going deeper than just tracking net promoter scores (NPS) every few months.
Many organizations use satisfaction surveys, but there are numerous other tracking methodologies that can be used, including:
• Embedded user analytics. Understand how the solution is really being used and which capabilities deliver the most value to users.
• In-app guides. Build personalized in-app communications that improve the product experience and solution adoption.
• Technical support usage tracking. Monitor technical support and advisory services usage, including due diligence on how quickly and effectively user concerns are addressed.
• Self-service tools. Provide a user self-serve education system and track completion rates and scores.
• Centralize feedback. Capture and consolidate all product feedback and requests from users in the app.
It's also vital to have a product operations team with a "voice of the user" role established in the organization to develop a strategy, apply expert analysis to the data that's collected, share critical insights with all internal stakeholders and ensure the PLG program stays proactive.
Make The Shift
Implementing these best practices can deliver stronger product development insights for technology firms. The data collected can empower companies to develop solutions grounded in real user value and become resilient to disruptions.
In traditional customer-led product development, the focus is on understanding the needs and desires of the buying customer and designing the product around those needs. However, this approach can be limiting, as it ignores the broader ecosystem of users that interact with the product. Making the shift from traditional PLG to a user-centric approach means companies can tap into a deeper well of data, have stronger impacts on user outcomes and provide an improved overall user experience.
Forbes Technology Council is an invitation-only community for world-class CIOs, CTOs and technology executives. Do I qualify?
