Why SoapBox moved from a Sales-led to Product-led Company

Posted on March 26, 2019

What we cover on Episode 33

We talk a lot about the shift to a product-led go-to-market on the GrowthTLDR, but we haven’t included many examples of companies who made that shift.

In this episode, we talk to Jessica Weiz COO of SoapBox about that very topic.

SoapBox used to have a sales team who sold their product to enterprise companies. Today, they have no sales team, a freemium version of their product and an upgrade path that you do yourself within the app.

We get into the advantages of adopting a product-led model, including the upside of having more people experience the value of your product, how freemium can grow demand for your product, and how adopting a product-led model doesn’t mean you’ll never have a sales team.

Happy Growing!


1. The strength of a product-led model is people can experience some value before they ever have to pay you a dime.

 

SoapBox used to have an enterprise sales team who went through a long sales cycle to convince enterprise companies in the value of it for their managers.

It’s a lot easier to convince someone they need a tool if they’ve already extracted some value from it.

SoapBox decided to shift direction and figure out what they could offer a manager for free so they could get started immediately.

“We considered what the smallest thing we could offer for free was so someone could get started with SoapBox. For us, it was one on ones and team meetings. Today, SoapBox is free for any manager who wants to start using it with their team and test it out. That’s how people want to buy today. They don’t want to go through some long procurement process without getting experience with a tool.”

2. One of the main advantages of moving to freemium is the growing demand for your product.

 

Before releasing a free version of their product SoapBox was targeting enterprise companies via sales. After moving to a product-led model, they started to see more companies sign-up to check out their product.

“We still saw many big corporates join to check out the product, and because it was free and for managers, we also started to see more small to medium-sized companies start using it.”

Of course, all those extra free users do come with some potential downsides, like additional costs on maintaining the free version of your software, network costs, dealing with support tickets for free users. You need to weigh up any potential downside with the upside you can at the top of your funnel.

Freemium generated a whole new source of leads for SoapBox.

“We’ve got 8,000 companies using our products, and that’s a different source of demand we now have access to, that we didn’t when running a sales-led model.”

3. Product-led doesn’t add up to no sales team ever!

 

SoapBox currently has no sales team. If you want to buy the app, you can get started for free and upgrade to their paid product.

Previous to this sales motion there was an enterprise sales team of 10 who were responsible for selling the product.

As you can imagine, they didn’t make that switch overnight.

“We started with a small team who were tinkering with building a product-led path while the regular business was operating as normal. Slowly we got more people involved and overtime as it worked, the entire company got behind it. It took us months and months to make that transition.”

However, the story doesn’t end with getting rid of the sales team. Like most product-led companies, there will be a need for sales teams, and they can leverage the product data to create a more efficient sales process.

SoapBox do plan on bringing back sales as their product evolves and a conversation is needed to sell the value. But the product-led model will help make that conversation a lot easier.

“We want our sales process to be proactive. We want to call the VP of HR and let them know 30% of their managers are already using SoapBox and would they be interested in adopting this across the company.”

4. Metrics and cross-functional collaboration are key for managers in product-led companies

 

Great managers are going to be great managers regardless of the go-to-market a company decides on. There are a couple of areas that have increasing importance for a manager in a product-led model.

In a product-led model, there is a lot of importance placed upon the funnel metrics. As a manager, you should make sure your team both understand them and feel accountable for one of those metrics.

“As a manager, you want to make sure your employees understand the metrics how they’re calculated. What they mean and why they’re important. They should also understand how they contribute to them.”

You also need to foster a great relationship with other functions – marketing, product, engineer, customer success, etc. That collaboration will be a critical part of your success.

Every team should feel a sense of accountability and ownership of the product being successful.

“For example, we have a weekly sign-up target. That’s not just a marketing goal because we rely on engineering to release the iOS and Android versions of the app. Releasing those apps helps us open up channels to acquire new signups.”

Real growth in product-led companies is a result of cross-functional collaboration.

The podcast provides a more in-depth look at these topics, so if you enjoyed reading the above, please do give it a listen.

Happy Growing!

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