Community-led growth is the booster pack in a PLG strategy.
But you need more than a massive fan base as a startup to scale into a flourishing company.
In today’s guide, you’ll:
- Learn what this go-to-market strategy is
- Explore how two exciting startups—one a household name and another an up-and-coming player in the SEO industry—set about tackling it, and finally, the one vital thing you need to
- Transform your product into a sales empire and amplify it via a community of loyal fans
Let’s get started.
What is Community-Led Growth?
Community-led growth (CLG) is a go-to-market strategy where loyal customers drive your product’s acquisition, retention, and expansion.
“Community-led growth is nothing new,” says Gary Amaral, co-founder and CMO of Breadcrumbs. “Many successful tech companies have grown thanks to passionate customer advocates spreading the news of their product.”
Tons of startups practiced community-led growth long before it became the shiny new toy.
Here’s a quick list of community-centric companies to further prove our CMO’s point (news flash: it’s not only Slack and Notion!):
- SparkToro: The audience research startup regularly hosts interactive “office hour” workshops where 1,000 members attend. Judging by Rand Fishkin’s latest email to his investors, business is growing.
- House of Wise: The CBD brand made $1 million after only one year in business. Founder Amanda Goetz attributes the success to her active and supportive community.
- dbt Labs: The B2B data analytics startup has a market value of $4.2 billion(!). Most of the sales conversations were born out of the interactions in the 20,000+ member Slack community.
CLG co-exists with product-led growth (PLG), and it’s no secret that revenue acceleration happens when you pair these two go-to-market strategies.
“Community-led growth is like PLG in that it’s taking established notions and bundling them together slightly differently,” explains Gary.
“The community shares, advocates, and acts as a resource to the rest of the users involved in the product.”
“You want to build light into your customer journey, both in and outside of the product. And you want to make it in a way where the community can interact with it.
It can be as simple as a newsletter they can contribute to and subscribe to or as complex as an actual membership-driven scheme.
The big trend right now is Slack communities, which are a great way to enable prospects, users, and customers to engage with each other (and with you, the business) in a low-friction way.”Gary Amaral, co-founder and CMO of Breadcrumbs
The CMO of Breadcrumbs continues, “Similar to PLG, the misconception here is that it’s the primary method. At a certain stage, this may be true. But as a startup scales to a large company, community is only one of the many factors that determine its success.”
Writer’s note: Gary is hinting at other factors, such as mature product and lead scoring (more about the latter in the next section).
How Do You Add Community-Led Growth in an Already Existing PLG Strategy?
Before you read this guide further, check that you have a well-oiled lead scoring system in place. While product analytics tools like Pendo identify product-qualified leads (PQLs), lead scoring rates the “sales readiness” of these leads (a.k.a. sales-qualified leads [SQLs]). The higher a lead scores, the more receptive they are to your sales pitch. PQLs are still very much a siloed piece of data. To turn your product into a sales empire and grow it via a community of loyal fans, you need to connect all customer data across all touchpoints. That way, you’ll have a more holistic view of your lead activity and a better chance of converting them to customers.
Here’s what you want to do:
- Connect your CRM with Breadcrumbs
- Fill in your customer demographic in the Fit model (tip: use your buyer persona as reference)
- Select the signals that show a clear buying intent in the Activity model (e.g., multiple visits to the pricing page within three days)
Breadcrumbs will send all scoring information to your connected CRM and notify you of the sales opportunity when a lead fits your customer demographic and fulfills your inputted activities.
(Fun fact: You can also use Breadcrumbs to identify customers ready for an upsell or catch them before they churn.)
Book a demo with Breadcrumbs to connect your customer data in one place and start right fast in community-led growth strategy today.
Now that you’ve built a lead scoring system, it’s time to grow an engaged community.
Tip #1: Identify your super users
Your community serves as the extension and voice of your customer success and sales force.
It’s the last piece of the puzzle in expansion.
For Notion, its community doubles as a growth catalyst.
The note-taking startup identifies advocates and empowers them to teach others to use its product.
It further rewards its community with a:
- Template gallery: Users can list and monetize their templates on Notion. One user made $34,000 from a template alone!
- Directory: Certified Notion consultants can list their offerings and win new businesses (not to be confused with Ambassadors, a program where users volunteer to lead local communities and host events).
At this point, you’re probably wondering, “What type of community should I build?”
Our answer: It depends on your product-market fit.
Based on Notion’s CRO Olivia Nottebohm’s experience, if you’ve achieved product-market fit and you’re targeting B2C and SMB clients, opt for ambassadors and creators (think: micro-influencers posts you often see on Instagram).
However, if you’re early in the product phase, leverage groups and convey to them what you’re trying to accomplish.
There’s no better example here than Frase, an AI content writing tool that went from 169 customers to 8,266 in 28 days after launching on AppSumo.
Recently, Frase launched a certification program, much to the customers’ delight.
Matt Hurley, the director of growth and operations, shares with Breadcrumbs that the decision came on a simple premise:
“When customers know how to use your product, they get more value out of it.”
Matt reveals, “We realized we weren’t doing a great job training our customers on the fundamentals.”
The Frase team saw many customers—including advanced users—who were completely out of the loop of the product’s full features.
“We frequently received feedback from customers saying things like ‘Frase is great, but I wish it could do [use case]’ when, in fact, Frase already did that thing. That was a huge failure on our part.”
Matt Hurley, director of growth and operations at Frase
And that’s how the certification program came about.
“The crash course helps people extract as much value as possible out of the tool that they’re already paying for,” shares Matt.
Here are two crucial reasons Frase offers a certification program:
- Benchmark knowledge: Customers can unearth relevant features that they don’t know about and learn how to make the most out of them. This boosts retention in the long run.
- Advertise services to potential clients: Pay it forward! Frase rewards users by offering them the opportunity to list their services in its exclusive directory. Customers who pass the course will earn a badge and be promoted to potential clients looking for expert users (writer’s note: this approach is similar to Notion’s certified directory).
In a nutshell: When product and community co-exist, you instill goodwill and boost retention and loyalty.
Tip #2: Listen to feedback but don’t always act on it
Customers are the heart of everything you do.
Echoing Notion’s strategy, you’ll want to continue growing your community to drive rapid adoption for PLG to scale.
More importantly, keep a close eye on every customer’s feedback.
The Notion team records every user’s conversation ranging from emails to call scripts, and manually tags them across the organization. Word has it that its system is loaded with 700 tags!
As much as we advocate customer feedback, take every review with a grain of salt. Not all feedback—even those that came from your well-intentioned and favorite customers—will align with your business goals.
Imagine a startup moving into enterprise but building features based on every SMB client’s request. That would be a catastrophe.
Consider Matt’s tip when growing a community: Be radically, unapologetically transparent.
“Our members are our sounding board for everything we work on,” divulges Matt.
He credits the community for helping the team save weeks of wasted time on features nobody wants.
For example, when Frase announced a new Archive feature, several members responded they should change the name to avoid confusion. The team implemented the suggestion in just an hour, and users commended the team’s speedy and receptive response.
“Our transparency and honesty help us build a mutual trust with our community,” says Matt.
“It pays dividends in the form of high engagement and invaluable product feedback. As a whole, our community is our company’s most valuable asset.”
Community-Led Growth: Drive Rapid Adoption for PLG to Scale
There’s a lot of overlap between product-led and community-led growth.
When these two strategies co-exist,
magic revenue acceleration happens.
Notion and Frase did nothing short of unusual. Both approaches are remarkable in their own way.
Of course, it’s going to take more than a community for your startup to scale into a large company.
On top of a robust self-served product (another post for another day!), you also need a powerful sales empire in place.
And that’s where lead scoring comes into play.
With lead scoring, you’ll have a more holistic view of your leads and a better chance of converting them to customers—not to mention how you’ll also be able to unearth customers ready for an upsell and catch them before they churn.
Book a demo with Breadcrumbs today.