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Welcome to another episode of the Product Led podcast. Today we're going to be doing a really fun episode. It's going to be a bit of a reverse interview. So Peter Loving, who is the CEO and founder of Useractive, he is interviewing me on what the heck is the product LED method. So this is something we've recently developed at Product Led. I'm calling it. It's a game changer for how you can scale your SaaS business faster with all things product LED growth. And so I'll walk through the three step phases of how it all works and the nine components and so you're in for a real treat. And if you want to learn more about the product led method, you can always just go to productled method.com and there's like a really long post that goes through the intricacies of it. But this is going to be the high level overview and it's going to give you a really great primer on what it is, why it matters and how you can actually implement it in your business too. So you're in for a treat. Enjoy.
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Okay. Hello everyone. I'm here today live with Wes Bush from productled.com thanks for joining us. Wes, would you like to take a minute to introduce yourself and tell us a bit about what you do?
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Yeah, absolutely. So I guess I am the obsessed person with all things product LED growth. I wrote the book on product LED growth. We have a product LED summit which you've been a awesome speaker at, going through all your amazing experience around the product and growth space and how you design it and to really give people the value. So yeah, I'm obsessed about this stuff. I love it. And what we really focus on@product led.com is helping founders gets to their first seven figures and self serve revenue.
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Fantastic. First seven figures. Okay. Do you, is this, is this bootstrapped or funded or is it a whole range? Whatever. You know, however the SaaS companies are funded.
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Yeah, it's all over the spectrum. Sorry. That like comes with their boatload of funding and also just bootstrap founders too, where they're realizing it's like, you know what the current way of scaling our business with the sales, that approach is very manual. We have to do everything. We got to hire these expensive salespeople. Like I can only afford the product that way. So I mean it's both ends of the spectrum. Like people are like, this is the best way for me right now. And then also on the other end of like this is how we're going to scale the best.
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Yeah. Great. Yeah. So in the last, I'd say it seems like it's the last five years product led kind of movement and SaaS has been huge. It's been like the hot toilet. And, and I know you've been at the forefront of that. So you've shared a lot of your kind of thinking and ideas and innovative concepts around product LED growth. So I read your book, which I thought was fantastic. Yeah, your original product led growth book. And now I'm where you've been developing some new concepts. I'd love to talk through this because I think they'll be really helpful for SaaS founders in this space who want to create a more product led SaaS business. So can you tell us a bit about the product LED method?
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Yeah, absolutely. So like the first book I wrote on product led growth is really just like how to build a product that sells itself. And, and then over the years, it's been four years since that time we've helped hundreds of companies just try and implement this. And what we started to realize is like, why are some companies really successful in other companies? Not like why, like no matter how good we make or something like that, nothing sticks or it just doesn't work for them. And so we started looking at like the companies we helped that didn't work and then the ones that really, really saw amazing value. And we started to say, what are the patterns? And what we identified is there's actually like nine main patterns and there's actually a logical order to like, if you follow them, you can actually build a product LED business faster, scale your self serve revenue faster. And so that's what I've been developing, which is called the product LED method. And so it's really three phases to it. There's like phase one which is like, okay, if you want to build this, you really have to build a growth blueprint, which really comes down to these three components, which is like you need to get crystal clear on like what is the vision of your company. Is it like, for instance, a lot of product companies, it's like we want to make accessible to everybody. It's like it's actually a part of your product strategy too in a lot of ways. So it's like connected to your vision and then your strategy get crystal clear on who is that customer and also that user that you're, you're actually helping. And a lot of companies are helping are like, I mean, they didn't have that vision component really well dialed in. And then the second kind of component there Is like the user component of just understanding. Like, okay, who is that ideal user? What is user success look like for them? What's their job to be done? Obviously is very important, but where do they get stuck? What are some of those big challenges? And then once you get that user component, what's really, really helpful is understanding what is that model that would actually help that user basically become like supercharged in value. So we look at like video games like Mario. It's like Mario picks up a flower and now you can spew fire. You can like be any bad guy and it's like, okay, that's so awesome. But like, what could that look like in your product of like, what are you giving away for free? What do you gate? And so those first three components kind of encompass your growth blueprint. And getting crystal clear on them actually puts you in a really great position to build that product that sells itself. And when you don't do that, that's where you get in hot water. You're like, we're giving away a lot of free stuff, but it's not the right stuff or it doesn't work and actually lead to that user value and user actually converting at one point.
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Oh great, okay. So you've got these, these three areas of vision, user and model. So you get crystal clear on the vision, you really understand the user. And then you, it's all about defining what's the right model for your, for your SaaS. Is that about the kind of acquisition revenue type model, how, how usage is, is based in the product and how it's monetized.
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So when developing your model, but we always start with is like back to the user component, what is that user success look like? So you get like crystal clear on that is your entire team. And then what I like doing for the model part is break it down into three groups. It's like, okay, so what are the beginner problems these people are going to encounter in order to get to that point? What are the intermediate problems they're going to encounter to get to that user success? Advanced problems. And so the goal is when you have that, you actually have designed your product LED model, which is like everything that was under that beginner problem bucket to get them to that first level that's free. And that's the really like really roundabout way of understanding, like what do we put in our free model? Is it a free trial, the free model? It's like I don't focus much on like the label. It's like, what's the outcome for this user Focus there and it will tell you the right model instead of obsessing about like, should it be freemium, should it be a free trial? Although that's a very popular blog post on our site and I know people think like that. Take a step back and look at it from the other view.
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Yeah, yeah, I know when, when people are getting into SaaS, there's so much to learn. They get, they start to learn about the models, the pricing methods, and then, and then you can tend to approach it from the wrong way. Right? You learn a theory and then you think you know which is the best one to use. But like you said, starting with the user, understanding them and then fitting, creating something that fits to their use case and what they need to succeed is it really sounds like the right way to go around doing it. So you've got these three key areas and then did you say there are nine points within the product LED method in order to be successful? And is that three points in each? In each of these key areas?
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You got it. So like once you are clear on your growth blueprint, just like a house, it's like, okay, we've got our foundation, we're ready to build now. And then the second part is like, okay, let's build that growth engine and product that can sell itself. And so that also has three components and they're very logical order, hopefully. But the first one always starts with like, getting crystal clear on your offer. So a lot of times we have helped companies where it's like, okay, let's improve your onboarding and give people the value. But then they have this like, awful, very confusing, conflicting offer of like, what's the value is like transformation xyz. Like, who is this for? What the heck is going to happen when I sign up? And no amount of good onboarding can help you if you have a bad offer. So like, start there, get crystal clear. And that all kind of comes back to. Ties back to the user component. Like, if you're really clear on that, you've done your research, that should actually be pretty easy to do. Obviously you've got to make sure it's compelling and everything, but get clear on that for the offer, make it easy to sign up. And that's really the, the end outcome of the offer component is make it effortless to sign up for that ideal user. And then the experience component is really where it gets by. This is your wheelhouse, Peter. Oh, that's it. Which is all about like, how do you actually get people to value and create that effortless path to value. And so that's the fun part where when it comes to product led companies, that's where the rubber meets the road. It's like if you can't figure out that experience component, game over. Like people won't come back to your apps ever again. And I think the, the stats, like 40, 60% people just don't come back a second time. So like that experience component, that's really all about that onboarding, getting people to value and coming back the second time again and again. And then the third part is like, okay, good, you've got people in the door. You made it effortless to sign up, you made it effortless to onboard people, get them to value. Now it's all about how do we make it effortless to actually upgrade. And so like having a public pricing page is like a starter, but like actually tying the value of your product to what the user experiences is that next level and understanding. Okay, as the user gets more value, we should be able to charge more. And what are the metrics we charge based on what did we do to make that easy? So that maybe somebody could start off with a very affordable plan and then as they grow, we could actually have a very lucrative customer here as we kind of expand the value that they receive. So it's all about growing customer value and aligning those incentives. And so those three components, your offer, experience and pricing component, really form the foundation of like building that growth engine.
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That's great. I love that. Okay, so you, yeah, you figure out your blueprint first vision, you get clear on the user. Then you, then you kind of start to develop a model that fits to that user. And then the growth engine is really about the, almost like the product adoption, isn't it? It's like that user comes in, they stay, the offer is compelling, they see value, they sign up, they start to realize that the product is good and they can understand how it works and they can realize that it has an engaging product experience. And I love this part where you're talking about the upgrade, you know, because we, we, like you mentioned, we do the product experience area and we're always designing upgrade flows to help. Sometimes companies come to us and saying, and they'll say, hey, we have, we get users in, but they don't stick around. And we really find that often they don't upgrade. And this is such a key area. It's understanding like what parts of your product are most valuable to them and then designing a flow that makes it really easy to go through the upgrade, identify the things that they need to select and then go through the payment. So this, yeah, this area is the part that I love the most. And because I'm really familiar with it, I'm really curious about what your next phase is because I wonder if this is going to be something around retention or you know, like reducing churn or kind of lifetime value. So. So let's see what comes after growth engine.
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Totally. So once you build your growth engine phase two, you move on to phase three, which is like all about exponential growth. And how do you actually scale this? Because a lot of folks, and I made this mistake too in my own business where I was like, okay, we have like great sales and everything like that. And then let's like scale this up, let's build a team, let's do all this stuff. And I was like, crash and burn. It was too early. We hadn't built that growth engine and it wasn't repeating its cycle. It was like more of like these one off kind of like cohorts and stuff. And so that was something where it's like, oh, okay, learn that one through experience. But basically there's, there's three things here. The first one is you got to get really, really good data of like what is going on in that growth engine. Where are people dropping off, where are people struggling, where can you basically add the most leverage? Everything starts with having the right data and a lot of early stage startups. It's like if you're just setting up your growth engine, you don't need to worry about that just yet. Obviously have the basics, kind of like analytics, but then get really, really hone in the dashboards and scoreboards, set up accountability for everybody on your team of like who owns what metric is part of this customer life cycle funnel. And then once you have the data, it's about setting up your growth process. So what are some of those experiments that you could be running? How do you prioritize like which ones you focus in on? How do you say like we're going to invest, you know, a month of time doing this one. It's high impact but like maybe also it's super high leverage. You could add a amazing part or new revenue lines your business. So how do you prioritize those experiments and do that consistently so that you're consistently adding more and more rate experiments and seeing what works, what doesn't. And then the last one is really team and you can't like build any incredible business without an incredible team as well. And so as you're going through identifying the highest leverage opportunities and you have the experiments going back and forth. Eventually you're going to get to a point where you say oh my goodness, we have so many potentially high impact experiments we could be launching and maybe if somebody owned this part of the growth engine, we could really grow faster. We could compound our growth faster. Now let's find the onboarding specialist. Now let's find the data engineer because we need better data to find better opportunities. Now let's find the person who can get more signups for us, who's really good at the copywriting side of things. And that's when you can plug in people to the equation and you have built this scalable monster that prints money and it grows way faster. So the order here is like it's so important and I wish I had this product LED method like way back like five years ago would have been useful. But yeah, I hope it was a good overview.
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Hey, that's fantastic. I really love it. So you start off with a good, good growth kind of blueprint. Get clear on your vision. Then the growth engine, a lot of that's focused around the product making it really deliver value. And then you've got the exponential growth area where you're looking at data, you're finding out what are the levers that you can work on that are going to really provide consistent growth. And then you put the people in place it effectively execute on that and make sure that you achieve that that growth. Hey, I love it. So this is going to be in your next book I believe. Can't wait for that to come out. What, what's the is that. Are you planning to release a books this year?
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Yep, it should be end of this year. As we were talking about morning routines. I'm working on it every morning now.
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Fantastic. Okay, well I look forward to that at the this year and where how can people connect with you and follow you or. Or get in touch with learning about product LED growth or use your services to help them implement product LED growth in their SaaS.
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Yeah, definitely. If you're looking to learn more about product led growth, just check out productled.com we have a ton of free resources. All our books are free as well. So go hog wild on those and that if you just want to follow along my journey as well. I post daily on LinkedIn as far as how we're building product led.com and everything else.
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Awesome. Okay, thanks so much. Go check out productled.com thanks for joining us. It was great to chat with you today.
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Thanks for having me. This was fun. Thank you for listening to the product LED podcast. If you found this episode helpful, please share it with a colleague or friends you know who might benefit. We are always looking at which episodes get the most listens so we know which content to create more of. So if you want more of this particular type of content or a style of episode, please share it out. And in return, here's your selfish reason to do this. We will definitely create more content just like this episode. And if that's not your style, please leave us a review wherever you listen to podcasts and tell us your favorite part about the this podcast. I personally read every single one of these reviews and it gives me more ideas on what content we should do more of. Happy Growing.