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- Product Led Sales close more deals: Tips, How-to, Examples (2025)
Product Led Sales close more deals: Tips, How-to, Examples (2025)
Product-Led Sales centers around offering a self-serve experience that allows customers to gain value and generate usage signals that can leverage for sales.
Gary Chan
March 24, 2025
Table of Contents
What is Product Led Sales?
The product takes center stage in the Product-Led Sales (PLS) motion, offering a self-serve experience through freemium models or free trials. This approach allows customers to receive the value from the product while generating usage signals that can help guide the sales process.
PLS strategy uses product analytics, usage insights, and sales data to identify customers who are most likely to buy. As customers use the product—reaching key milestones, trying advanced features, hitting paywalls, or inviting teammates—these activities create a compelling sales case. Sales teams can use this data to show how the product has helped the customer and suggest opportunities for upgrades or expansions.
Using product usage data in the sales process, PLS makes sales efforts more efficient and predictable, adding a powerful layer to traditional sales motions.
Source: Headway / Unsplash
What are the key components of Product Led Sales?
The key characteristics of product-led sales include:
Freemium or Free Trial Experience 🆓
The goal is to make it easy for users to try the product, get value, and see how it fits into their daily workflows. By helping users get started and use the product effectively, they can reach important milestones through onboarding, activation, and retention. As users achieve these milestones, they become Product Qualified Leads (PQLs), signaling a high likelihood of purchase, upgrade, or expansion.
Self-Serve Product Experience and In-App Onboarding 👨🏽💻
The product experience is self-served, and users can easily discover value through product led growth bumpers (tooltips, in-app experiences, documentation) that help them reach these activation milestone points.
Hand Raisers 🙋🏻♀️
Customers can also become product-qualified leads by hitting paywalls and wanting to explore advanced functionalities. They might hit usage limits, indicating that they are coming back to get value over and over again—recurring value and deepen engagement. They might raise their hands for support to find more advanced strategies and learn more about additional product offerings. All of this feeds into the sales pipeline in a "farming" strategy.
Data Pipeline 📊
A robust system that collects usage data, product signals, customer intent, page visits, and marketing signals and integrates them into actionable criteria for the sales team to reach. These criteria can be different from product to product, but ultimately, these insights inform the sales team to act timely and precisely, creating an efficient sales motion tailored to each user's journey.
How does Product Led Sales motion impact each department?
The product-led sales motion requires cross-functional changes and each team's support to increase sales efficiency.
Sales Team:
To Farmer and Hunters: Sales teams' role shifts from purely outbound to prioritizing leads with product signals and product usage for targeted outreach. With this additional data point, they can create compelling sales pitches for these high-likelihood-to-buy customers.
Trusted Advisors: Sales also becomes more of an advisor and consultant. Sales teams guide users to advance use cases and nudge them to hit the milestones, which reinforces the sales pitch to expand or upgrade.
Data-Driven Decision-Making: Sales teams armed with product analytics can focus on identifying high-value accounts and prioritizing leads most likely to convert.
My experience: We have internal dashboards that are housed on Looker. We review the customers’ most recently logged-in date and whether they've moved forward on their user journey. Then, we use the usage data to reach out to customers and create conversations.
Product Team:
Optimize Self Serve Product Experience: The product team defines the self serve customer journey. This requires more experimentation and iteration to get customers to activate and hit their “aha” moments faster, which can then pass this signal over to the sales team to close for expansion deals.
Design Lifecycle and Nurturing Experience: Collaborate with lifecycle marketing teams, sales teams, and customer success teams to create the optimal customer nurturing experience and tech touches, attracting users back and ensuring they continue to achieve the core value. Driving retention and continued engagement.
My experience: As the product team, we work with the engineering and design teams. We iterate on simplifying the self-serve onboarding process, making it easier to understand, and providing all the necessary resources so that customers feel reassured.
Marketing Team:
Product as Lead Magnet: The marketing team is now using the product, the freemium experience, and the free trial as lead magnets, replacing case studies, tutorials, and webinars as traditional lead magnets.
Route Visitors to Product: Campaigns, case studies, and beachhead landing pages are designed to route users directly into the product experience while offering educational content that accelerates onboarding and activation.
My experience: We updated our call-to-actions (CTAs) on the landing pages to route users to sign up for a freemium product because we are confident that this is the funnel that will eventually get them to upgrade.
Engineering Team:
Self-Serve Experience: Engineering and Product teams have to focus on building easy-to-use experiences and frictionless onboarding that previously would've been handled by the sales team.
Self-Serve Infrastructure: Engineers develop frictionless onboarding systems, self-service checkout flows, analytics tracking tools, and integrations with sales/marketing platforms. Engineers are also creating robust product performance tracking to minimize the impact on self-serve users.
Experimentation: Engineering supports A/B testing for onboarding flows and feature rollouts to improve activation rates and reduce time-to-value.
My experience: The engineering team is the backbone of product-led sales. Engineers, in partnership with the product and design teams, are developing frictionless experiences and constantly iterating on what works. They're also developing paywall strategies to create a self-serve experience that converts free users to paying customers.
Customer Success Team:
Proactive Support: The Customer Success Team proactively supports users at-risk (like declining logins, stuck on the user journey, or multiple support tickets) and intervenes before they churn.
Scaling with Self Serve Resources: The customer success team and the product team are creating self-serve documentation, onboarding guides, in-app tooltips, interactive demos, and community resources to encourage users to move forward toward activation milestones.
Customer Success Qualified Leads (CSQLs): The Customer Success team works with the Sales team to identify customer success-qualified leads and hand-raisers eager to learn more about the product and use advanced functionalities. These leads are then passed off to the Sales team for further discussion.
My experience: The Product-Led Growth Customer Success Team drives Product Led Sales because they nurtures customers, reassures them, and helps them achieve their product milestones.
What are the benefits of Product-Led Sales for the sales team?
Shorter Sales Cycles: Product-led sales shorten sales cycles because the customers can experience the product without talking about it. Complex software still requires traditional methods like demos, diagrams, pitch decks, and eBooks. When users can get value quickly, they can make decisions faster. Using these engagement signals, we can close deals more rapidly.
Lower Customer Acquisition Costs (CAC): Product-led sales utilize the low-touch, self-serve product experiences and product signals to reduce the need for marketing and sales outreach, ultimately lowering CAC.
Increased Conversion Rates: By driving customers to quickly get value from the product and leveraging those engagement signals, we can see that they find the product useful, creating more propensity to upgrade and higher conversion rates.
Increased Predictability of Revenue Growth: We create a more efficient sales process by unlocking product data and signals that were not available in a traditional sales let model. These insights create more compelling and personalized sales pitches that improve our ability to predict revenue growth.
Data-Driven Approach: By adding product signals, we can be more thorough in our filtering and segmentation and create more personalized sales messaging to encourage upgrades and expansions. We can also optimize these data signals through more experimentation in the product and the sales experience.
Scalability: Product-led sales shift from a "hunting" strategy to a combination of "hunting and farming" strategy. Also, letting the product gather signals from a large volume of potential leads through the sales service experience. Once these leads mature, they are efficiently passed to the sales team for conversion.
What are the success metrics for Product-Led Sales?
The North Star metric for both Product-Led Growth and Product-Led Sales should get users into an activated state. Once users are activated, they are more likely to upgrade, which drives sustainable growth. Investing in predictability by reducing Time-to-Value (TTV) accelerates the Product-Led Growth flywheel. As revenue increases, the ability to reinvest shortens the payback period and speeds up the growth trajectory.
PLS North Star metric = Get users to activated state
Acquisition Metrics
Free Trial Sign-Ups: The number of users who start a free trial or freemium version of your product
Organic Traffic: The volume of visitors visiting your product or website through unpaid channels. Scaling a high number of sign-ups typically requires a strong organic traffic source.
Referral Sign-Ups: New users acquired through existing customer referrals. The Product-Led Growth's strength is generating powerful word-of-mouth marketing for sign-ups.
Customer Acquisition Cost (CAC): The average cost to acquire a new customer, calculated by dividing total acquisition expenses by the number of new customers. Your CAC will decrease as your Product-Led Growth strategy matures and generates more referral sign-ups.
Read how 40% of our PLG sign-ups came from referral word of mouth:
Conversion Metrics
Activation Rate: The percentage of new users who complete key actions that indicate they have experienced the product's core value or have crossed their activation milestones in their user journey.
Time-to-Value (TTV) is how quickly users reach their first moment of meaningful value within the product. To get the product-led growth flywheel spinning faster, we want to decrease the TTV so that more customers experience the value faster. This creates a higher propensity to sell and upgrade, which generates revenue that can be reinvested into driving more sign-ups.
Product Qualified Lead (PQL): The number of customers who have "raised their hand" by hitting a paywall, reaching the activation point, or indicating readiness to engage further with the product.
Free-to-Paid Conversion Rate: The percentage of trial users who convert to paying customers, which can be optimized with your landing page and marketing campaigns.
Expansion Metrics
Customer Lifetime Value (LTV): The predicted total revenue a customer will generate over their entire relationship with the product. By tracking LTV, you can showcase the sustainability of the Product-Led Growth strategy.
Retention Rate: The percentage of customers who continue using the product over time, which can vary based on your pricing model (ex: usage-based pricing, monthly, quarterly, annually)
Net Revenue Retention (NRR): A measure of revenue growth from existing customers, including expansions and churn. A higher NRR likely means stronger sustainability for the Product-Led Growth model.
Learn more about retention benchmarks:
Efficiency Metrics
Revenue Per Employee (RPE): Annual Recurring Revenue (ARR) divided by the number of full-time employees, indicating operational efficiency and determining the scalability of PLG vs. SLG (sales-led growth).
LTV: CAC Ratio: The ratio between Customer Lifetime Value (LTV) and Customer Acquisition Cost (CAC), with a healthy ratio typically considered to be 3:1. While a healthy ratio ensures sustainability, it may also suggest that not enough is being invested in new customer acquisitions.
LTV: CAC Payback Period: This metric measures how quickly the cost of acquiring a customer is recouped through revenue. By speeding up the cycle from acquisition to paid customers, you generate revenue faster, which can be reinvested to accelerate growth. The faster this flywheel spins, the faster the growth rate.
Learn more about how you can track LTV CAC and with downloadable template:
Source: 1981 Digital / Unsplash
How does the GTM differ: Product-Led vs. Sales-Led?
Focus
Product-Led Sales focuses on how users interact with the product as signals to guide sales efforts. On the other hand, Sales-Led Motion relies on the sales team to find and convert new customers.
User Acquisition
Product-led sales rely on the product itself to attract and convert customers through free trials, intuitive self-serve onboarding processes, and easy access to core features. On the other hand, Sales-Led Motion relies on a sales team to actively reach out to potential customers, pitch use cases, and convert leads, with the product supporting the sales process.
Customer Engagement
Customer engagement differs significantly between the two approaches. Product-Led Sales engages customers based on product signals, which allows for more personalized and timely engagement. In contrast, Sales-Led Motion requires a human touch through discovery calls, pitches, and negotiations to build relationships and address complex needs.
Sales Cycle
Product-led sales usually have a shorter sales cycle because users can quickly see the product's value with a frictionless experience and decide to buy. Sales-led motion involves longer due to multiple sales interactions, such as discovery calls and budget approvals, which are necessary for complex sales processes.
Cost Efficiency
Product-led sales tend to be more cost-effective because they use the product to attract users, reducing the need for expensive sales efforts. Sales-led motion results in higher CAC because of the involvement of sales teams and the resources required for sales outreach and negotiations.
Lead Scoring
Product-led sales focuses on users already engaged with the product, known as Product-Qualified Leads (PQLs). Sales-led motion targets leads qualified by sales teams, known as Sales-Qualified Leads (SQLs).
Market Suitability
Product-Led Sales works well for products optimized for self-serve, allowing more users to access. Sales-Led Motion is better for complex enterprise or mid-market products that need personalized sales support and custom solutions, where access to the product would be parallel to the sales team, who can handhold customers.
What are the common misconceptions of Product Led Sales?
Misconception 1: PLS Eliminates the Need for Sales Teams
Many companies are looking into product-led growth because it can reduce the size of their sales teams. However, many product-led companies are actually hiring more salespeople to help drive growth.
Some believe outbound sales are no longer necessary, but that's not entirely true. Outbound sales are still important for bringing customers to try the product. Once customers start using it, they are more likely to make a purchase.
In this new setup, sales teams act more like consultants. They help users find solutions, solve product issues, and meet their complex needs. This product-led sales approach can actually improve sales conversion rates.
Misconception 2: PQLs Will Replace SQL and MQL
Product-Led Sales does not replace sales-qualified leads (SQL) or marketing-qualified leads (MQL). It adds extra insights with product-qualified leads (PQL), helping the sales team understand which customers might be interested in upsells.
Using SQL, MQL, and PQL together gives us a clearer picture of customer needs throughout their journey. This helps us see when customers are getting value, which allows us to deliver effective and timely sales pitches.
Misconception 3: Users Will Be Completely Self-Sufficient
One common misconception is that once you build a product, it will be perfect, fully self-service, and free of customer success or support challenges.
Theoretically, this might be true, but it typically takes about six to nine months to create an optimized self-service experience in practice. During this period, human touchpoints are essential to guide users and help them navigate the product. Eventually, a customer success team will support and encourage customers, creating a feedback loop that allows the product team to enhance the self-service experience.
Customers often reach out for help when they're stuck or want to learn about advanced features. Having sales and customer success teams available will enable you to better understand customer use cases and develop new product lines accordingly.
Misconception 4: Implementation Requires Only Product Changes
The product is evolving into a more self-service experience. However, the Product-Led Growth (PLG) strategy introduces new concepts for every department. Product-Led Sales is targeting a new market segment, which requires revised messaging and a fresh approach to positioning. Consequently, the strategies for acquiring and retaining customers will change.
Customer support and customer success teams will need to implement new processes, such as scaling through self-service documentation and community resources. The sales team must align more closely with the product to create customized solutions for clients and stay informed about how users are interacting with the product.
Misconception 5: Product-led sales is only for small contract ACV deals
Product-led sales involve product signals, regardless of whether the customer contract is small or large. The key is to leverage these signals to create timely and personalized messages that can help with scoring and upgrading customers. For larger annual contract value (ACV) deals, the sales team is likely to stay consistently engaged with customers and monitor their usage scores. In contrast, smaller customers may need alert systems, filters, and dashboards to identify when they are ready to progress and mature.
Who leads Product-Led Sales?
The Head of Product-Led Growth should spearhead the product-led sales strategy. As both the advocate and implementer, this leader must collaborate closely with Product Marketing and Sales to develop a revenue generation strategy that converts free users into paying customers.
Product-Led Growth is a revenue-focused initiative that extends beyond just increasing profits; it creates a word-of-mouth flywheel that generates a steady pipeline of qualified customers. This process is activated through an engaging product experience.
The Head of Product-Led Growth should have the ability to manage the entire funnel, from customer acquisition to monetization, in collaboration with the sales and marketing teams.
Where is the Product Led overlap with Sales led in terms of product strategy?
Many companies now incorporate both sales-led and product-led approaches. Creating a cohesive product strategy is required.
Improving the self-service product experience benefits all customer segments. This includes providing self-service documentation, video examples, and user-friendly in-app guidance. The product-led approach allows companies to target lower tranches of customer segments and improve their experiences, allowing the sales team to focus on going upmarket.
The signals gathered from the product-led approach are critical for sales efforts that create a proof-of-concept trial for mid-market and enterprise customers. A major plus is having a sales team knowledgeable about the user journey and use cases, and training to become sales engineers or solutions engineers.
Read more about Product-Led Growth roadmap
How to scale Product-Led Sales?
We can scale Product-led Sales by:
Iterating and expanding on onboarding
Continuously improve the onboarding, reduce the time-to-value, and make it easier for users to be activated. Then, layer on different types of use cases and user roles with different activation milestones. For example, we can tailor onboarding for an engineer-user versus how a marketer-user onboard.
Refinements are on the product qualifying filters
Iterate on what those product-qualifying leads (PQLs) benefit from activation, raising their hand asking for support, hitting milestones, and visiting the pricing page. Focus on testing and experimenting with various customer segments to create timely outreach strategies.
Easy Discovery of Advanced Features
We want to create product-led bumpers to encourage users to try advanced features and be aware of new functionalities. As customers navigate the self-serve journey, they encounter new use cases where they either raise their hand for support or proceed to the self-serve checkout.
Community Support
Self-serve experience opens opportunities for community influencers and champions. Their contributions and social media shares create more virality and attract more users to your product. By encouraging community growth, PLS becomes easier at driving acquisition and retention.
What tools do you need for Product-Led Sales motion?
By having this tool stack, you can master the product and let sales funnels:
Product Analytics
Why You Need It:
Having a product analytics tool helps track user behavior, including feature adoption, engagement, and retention metrics. These insights allows the sales team to identify high-value leads, engage customers and users, and learn more about their urgency and intent based on product usage metrics.
Examples:
Product Qualified Leads (PQL) Scoring Models
Why You Need It:
PQL scoring models use product usage engagement data combined with CRM and marketing signals to prioritize high-intent leads for the sales teams to focus on the most promising opportunities.
Examples:
Entitlement Tools
Why You Need It:
Entitlement tools manage access independently of the billing system, allowing you to enforce plans, create trials, roll out features, and update pricing pages and contract terms.
Examples:
Paywall Tools
Why You Need It:
Restricting access to advanced features and customized functionalities. When users interact with paywalls, it should generate a hand-raiser notification to signal the sales team of intent to upgrade.
Examples:
In-Product App Guidance
Why You Need It:
In-app guidance tools provide tooltips and onboarding flows that help users quickly realize the product’s value. These tools drive conversions and improve long-term retention by guiding self-serve users effectively.
Examples:
Lifecycle Marketing Tools
Why You Need It:
Continue nurturing customers and encouraging their return through marketing email campaigns, promotions, and personalized activity summaries. The more users engage with the product, the more signals we have for our product qualified lead scoring models.
Examples:
Customer.io: Supports multi-channel communication via email, push notifications, and SMS.
HubSpot: Offers an integrated suite of CRM and marketing tools to track engagement as a single source of truth.
Retention and Churn Management Tools
Why You Need It:
Track retaining users and ensure their continuous engagement leads to a higher likelihood of further upgrades.
Examples:
Churnkey: Creates personalized cancellation flows to retain users and collect feedback.
Baremetrics: Tracks subscription trends and identifies churn risks with actionable insights.
Source: Annie Spratt / Unsplash
What company is the right fit for Product-Led Sales?
Product-Led Sales motion is a great fit for companies whose product can easily onboard and activate customers, have a large market to target, and can run a data-driven organization.
Easy to Activate a Customer
When a product has a straightforward linear user journey for customers to activate and see the value of the product, that is one of the core attributes of product-led sales. When customers see value, they're more likely to continue engaging and returning to the product. Through my experience conducting onboarding calls, we discovered what the Aha moment is and what makes users “get” it, leading them to continually invest in using our product. By creating that pathway, reducing the time to value, and increasing the number of activated customers, we can foster an excellent environment for product-led sales.
Large market demand
Product-led sales have shifted from a purely hunting model to a combination of hunting and farming. With farming, you need a large volume of customers to use the product. In my experience, having about 30-50% of customers using your product on the freemium tier is a positive signal. Those customers who are actively engaging can move forward in the funnel and become product-qualified leads with a higher propensity to purchase or upgrade. Having a substantial number of customers at the beginning will allow you to generate a sufficient amount of leads downstream in product-led sales.
Data Driven Organizations
Product-led sales really relies on having good analytics, as that supplies the sales priorities for the team to reach out. Many companies today are increasingly data-driven; another way to describe this is simply as using "math. " Organizations should calculate what is necessary for the funnel to be effective, and product-led sales significantly enhances efficiencies within the funnel, especially at the bottom where the sales team has a clear reason to engage customers based on their product usage.
I do believe with the right adjustment Product Led Sales can work for many companies. It then requires a shift internally in those companies to adapt for the goal of more efficient sales motion.
What company is NOT a right fit for Product-Led Sales?
Product-Led Sales may not work well for companies with complex products, low product usage data, have resistance from their internal sales team, have unpredictable sales and marketing, and where buyers are high in the enterprise chain.
Complex products
Complex enterprise software that is highly customized, very process-driven, and requires each large business to have its own workflows is going to have a very hard time activating users easily. In those complex products, customer success teams and product teams need to guide users through setup and continue assisting as they adopt workflows. Customers who cannot onboard and activate easily through self-service are unsuitable for Product-Led Sales.
Low Product Usage Data
Product-led sales require having customers' product usage data, which helps sales teams identify product-qualified leads. A robust data infrastructure for collecting and analyzing this data prioritizes outreach for the sales team. Products with low usage data are a poor fit for product-led sales.
Sales and marketing are not predictable yet
One of the advantages of product-led sales is that if you have a strong top of the funnel, customers using the product generate signals that support this farming process, leading to sales outreach. However, if the top-of-the-funnel sales and marketing efforts are unpredictable and unsustainable, then you won't have a consistent volume of customers to make product-led sales viable.
Buyers are high in the enterprise chain
Product-led sales' strength is also in the bottom-up of the options. Products that are very top-down sales motions are also not a good fit when executives/C-level leaders prefer a traditional sales approach with demos and value presentations.
Resistance from the Sales team
Product-led sales require the sales team to adjust and adapt to new skills and changes in workflow. Any resistance can make it difficult. Traditional sales teams typically operate by scheduling calls, giving presentations, and following up on those calls. However, what's often missing is the consultative aspect - fostering an understanding of how to use the product and motivating users to stay engaged and active. Product knowledge is crucial for product-led sales, and when sales teams resist acquiring it, this can disrupt the product-led sales approach.
This whole week will be about Product Led Sales…
How can Businesses prepare for the Future of Product-Led Sales with AI?
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I am Gary Yau Chan. 3x Head of Growth. Product Growth specialist. 26x hackathon winner. Building ClarityInbox. I write about #PLG and #BuildInPublic. Please follow me on LinkedIn, or read about what you can hire me for on my Notion page.