Hi, my name is Aaron Stillman, and I’m the Head of Product Marketing and Product Education at AB Tasty. Today we’re going to look at how you can bundle for success.
Let’s start with the three takeaways that I hope you’ll walk away with at the end of this article:
- Let experimentation data lead the way: One of the things I love about working at AB Tasty is that the test-and-learn culture is so embedded within the organization. Because we're an experience optimization platform, there's been literally zero ideas that I've wanted to test that anyone pushed back on.
- Don't stop: People change, products change, and markets change. Don't ever stop evolving and iterating upon the packaging of your leaders, killers, and fillers.
- Be agile: When you have easy-to-use feature management, it opens up a lot of opportunities to be creative and agile. You can play around to see what's working and what's not live in production and find that sweet spot in your product-led growth momentum.
Just so we’re all on the same page…
Before we dive in, there are a couple of caveats to keep in mind. If you're in a product-led growth company, and you don't have top-down sales momentum, things might work a little differently for you than in the examples I’m going to share. If your product is open-source, that’s another variable to consider, and so are your market segments.
For context, I’m going to be talking primarily about a B2B SaaS company that had a top-down sales-led model for about 10 years before introducing product-led growth, and this type of hybrid model takes time as well as commitment so we’re only just getting started.
About two years ago, we introduced product-led growth at AB Tasty, with a 30-day free trial of our Flagship product. We're still chipping away at it, but it's been an incredible journey so far, and we are seeing some early success.
Our sales leaders are now able to have more impact in enterprise conversations and the PLG influence on enterprise deals continues to show results quarter over quarter.
The dream is that one day, instead of presenting a deck with many slides introducing and talking about the value associated with the product, they just bring four slides, showing who we are, a list of their employees who use our product, and a case study of the value they’re already receiving.
Finally, just in case you’re not sure what I mean by product-led growth, let’s take a look at a quick definition:
Product-led growth is a go-to-market strategy that relies on your product as a vehicle to acquire, activate, and retain customers.
Leaders, killers, and fillers
Now, you might be wondering what the “leaders, killers, and fillers” title is all about. It comes from a bundling framework devised by Simon-Kucher & Partners. Let’s apply this framework to a McDonald's menu to see how it works.
The hamburger is your leader – it’s a high-value product that a customer “must have”. The fries and the drink are fillers – they’re nice to have and most customers enjoy them, but they’re not willing to pay a lot more to have them. Coffee is a killer; if people see coffee in the bundle and they don’t want it, they're not likely to buy that bundle.
I would strongly recommend that you dive deep into your product data, including qualitative data via customer conversations, and figure out which features are your leaders, which are your fillers, and which are your killers. This is going to help you build the most attractive bundles.
How we implemented product-led growth
Two years ago, our team embarked on a journey to introduce product-led growth at AB Tasty. We started by listing out every feature, sub-feature, and sub-sub-feature in our product on a long Google Sheet.
We then evaluated the cost of each feature to us, and the cost every time a user leveraged that feature. We considered putting quotas on certain features and gating them, either in the free trial or our premium packages.
Next, we thought about whether to include an in-app message when someone hits the feature gate. Going through this exercise, we realized that a lot of in-app messages could be shared across features. Some messages were relevant across the board, while others needed to be unique to the feature to be relevant and impactful.
We then considered whether to have a quota for how many features users should have access to as part of a free trial. Some features were unlimited, while others were completely disabled. We then evaluated quotas for the other packages.
The tools we used
One of the tools that helped us as we were figuring this all out was FullStory. It’s a behavioral analytics tool that provides a wealth of insight into user behavior, through heat maps and session recordings. We used this tool to understand how our enterprise customers were utilizing the product, the aha moment, and where they were achieving value. This helped validate some of our assumptions and hypotheses.
Another tool that was useful in this process was Mixpanel, a product analytics tool. One interesting insight we gathered from Mixpanel was that there was an overwhelming number of customers who used only one targeting key when creating experiments or feature toggles. This made it easier for us to decide on a quota of one targeting key in our free trial.
Another important tool in our tech stack was Sherlock, a tool that we used for tracking activation and product-qualified leads. The combination of firmographic criteria and product utilization gave insight and automation to the PQL process and engagement with the sales team.
This information was then fed to our sales team to make their conversations with potential customers more personalized and qualitative, based on how they’ve already used the product.
How AB Tasty leverages Flagship
Coming from the United States, a common saying that I’d use is about eating your own dog food. Now that I'm working for a company based in France, I want to use the language of love’s much more elegant equivalent: drinking your own champagne. Let's see how we drink our own champagne at AB Tasty, leveraging Flagship – our own product – to power our product-led growth.
Whether you use in-house or third-party tools, flexible feature management and experimentation are great. They allow you to play around in production without over-investing in expensive engineering teams. With Flagship, you can easily go in and change the feature flag values to test different variations of the product.
For example, if you want to offer a discount to users who are using two of your products on a mobile device, it’s easy to go in and do that. The use of a feature management tool with flags also makes the process more agile and flexible compared to hard-coding every change - every time. It’s easy for anyone with authorization to change that discount value and see what works best.
Another advantage of feature management is KPI-triggered rollbacks. This is very useful when doing a progressive deployment and targeting exposure to a certain percentage of users each hour/day/week/month.
If things don't go as expected or you come up against some kind of roadblock, the switch can be flipped off automatically. This doesn't mean the issue should be ignored or doesn’t need to be fixed, but it does mitigate the risk and business impact until a fix is implemented, at which point the switch (feature toggle) can be flipped back on.
We also gated a feature initially, meaning that users had to upgrade to access it. However, we ran an experiment where free trial users started seeing "try it for free." We saw a lot of success with this because once users were able to see the value, they were more likely to be interested in talking with us or signing up for the paid version through the product.
We were also very agile in our approach. To give you an example, we had a feature that was going through internal alpha testing, for which we targeted everyone with an AB Tasty email address. This became a scalable low-cost way to make sure everything was working in production before progressively rolling the feature out to customers.
Another example is when we had a free trial user who was super interested in a feature, but it was not ready yet for general availability.
After some back and forth, we decided to go into Flagship and modify the test just a little bit to let this one free trial account gain access to it. This is just one example of how having a flexible feature management solution allows you to be agile and adapt your approach on the fly.
Understanding the impact of a new variation or feature on your business is critical in deciding whether to move forward with an investment. From a product management perspective, it's important to avoid "gold plating" and focus on creating a minimally viable product.
This can be challenging, but using technology that harnesses behavioral analytics can make it easier. It’s important to start small, test the product, gather feedback, and iterate.
I spent years in product management before moving into product marketing and I wish I had known about this technology earlier. It’s so useful for making informed decisions about your investments and continuously improving your products.
- Let experimentation data lead the way. Test and learn which features are your leaders, killers, and fillers.
- Don't stop. Everything is always evolving.
- Be agile. When you have the flexibility to manage your features, run experiments, and personalize the user experience, you can be very agile, and innovative
In product-led growth organizations, I'm seeing product management having more and more of an influence on the packaging, if not outright owning the topic.
If you don't have your seat at the table yet, it’s time to go get it.
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