Product-led growth is propelling a wave of sales tools startups

Despite their moniker, PLG CRMs don’t intend to replace Salesforce just yet

This might be the year when we see more companies adopting sales tools that bridge the gap between traditional CRMs and product-led growth models to help sales teams more effectively convert leads with the help of usage data.

Why is this happening now? Well, companies are going hybrid, whether with their business model or their pricing. For instance, more companies are adopting usage-based pricing models, but they’re often mixing it with existing pricing models, such as subscription tiers.

Along the same lines, many companies have adopted product-led growth (PLG) without abandoning their traditional sales efforts. The two motions typically work in tandem, with self-serve adoption driving most usage and sales reps dedicated to closing larger enterprise deals.

However, sales reps don’t qualify accounts the way they used to. Why would they be cold-calling anyone or spending money on marketing when there might be much warmer leads in the existing user base? This has led companies to adopt a new approach known as product-led sales.

In product-led sales, the concept of “marketing-qualified leads” gives way to “product-qualified leads” (PQLs). This is a major shift because to truly provide sales teams the data they need to upsell or cross-sell existing users, companies must closely align and connect their product usage data with their sales tools and CRMs.