The Power of Data in Driving B2B Product-Led Growth

Data is one of the most valuable assets for every organization—especially product-led ones. 

The premise of product-led growth (PLG) is to position the product itself as the main driver of customer acquisition, retention, and business expansion. If you’re going to succeed at this, you’ll need to collect and analyze data from digital- and customer-facing teams, including marketing, product, and customer success.

This data will help you understand how effective your marketing is and what your customers think about your product, and it will be a driver of revenue acceleration.

In this piece, we’ll delve deeper into the role of data in product-led growth and how to align your metrics with your PLG strategy

Why being data-driven is important

Collecting data from your teams is the best way to see what’s happening in your business and how to improve things. You can craft strategies that contribute to sustainable business growth only when you have raw insights. If you’re unsure why it’s important to base all your business decisions on data, here are four reasons. 

1. Continued business growth

Most businesses that exist are for-profit. If yours is—and it likely is—then you want every move you make to contribute to the growth of the business in some way. Studying the data and key insights, your teams gather about your product better positions you to develop winning ideas that positively affect the bottom line. You’ll also be able to manage risks efficiently and increase the success rate of your marketing campaigns.

2. Identify new business opportunities 

Gathering and analyzing data can reveal new opportunities to expand your business, make new professional connections, and develop products that meet consumer demands. This, in turn, helps your business generate more qualified leads and drive revenue.

Illustration Of Breadcrumbs Icp Worksheet


Ideal Customer Profile (ICP) Worksheet

Learn how to create an Ideal Customer Profile and build a successful sales strategy with this Ideal Customer Profile (ICP) Worksheet.

3. Outperform your competition

Companies that don’t collect and analyze data are more likely to make changes to their strategies or veer in a new direction based on what their competitors do. Bluntly put, this is a recipe for disaster. Your competitors will release different features, run all kinds of ads, and implement whatever strategies they want at different points in time. The goalposts always move, so trying to imitate them usually doesn’t end well. 

Working with data ensures that you get a headstart on your competition. Your data will show you the trends that your target audience is following. When you understand what your customers expect from your product, you’ll be able to deliver it and have an edge over your competition. 

4. Improve customer retention

There’s no better way to keep your customers happy than to give them what they want. But you can’t know what they want until you collect their insights. 

These insights show you what makes your customers tick and help you identify unhappy customers so you can fix the situation before they leave. This increases your chances of keeping your customers.

Advantages of being data-driven as a marketing operator

If you’re a marketing operator, here are a few reasons why you should make data the backbone of every action you take.

1. Make better, informed business decisions

Decision-making is a non-negotiable aspect of business growth that often involves shareholders, business executives, and a lot of money that the business can’t afford to lose. 

As a marketing operator, making decisions based on hard data that you’ve collected prevents you from making changes based on assumptions, guesses, hunches, or anecdotal judgments. Instead, you’ll use the facts, insights, and statistical numbers to make informed decisions that move the needle toward business growth.

2. Better communication

Being data-driven as a marketing operator can improve how you communicate with your team and other teams in the organization. Whether you’re discussing your product-market fit or product marketing strategy, working with data visualizations and KPIs will help you operate cross-functionally with other teams as one cohesive unit. 

Each department will be able to share insights easily and collaborate on projects that will help the business generate more revenue.

3. Understand your users 

Product-led businesses prioritize what a user does with their product before considering them a viable lead to pursue. In light of this, a data-driven marketing operations manager gathers data on each customer from the point they sign up for the product till they find their “aha” moment. This data helps you discover what people use the product for, where they’re dropping off, their pain points, and so much more. 

Sales teams also use customer relationship management (CRM) tools to store prospect and contact information and manage the company’s interactions with existing customers and prospects. The information they gather can greatly influence the changes marketing teams make and the new features they add to the product. 

4. Time optimization 

When you have raw data on how people are using a product, you’ll be able to group the tasks at hand into the boxes of “urgent” and “not-so-urgent”. This way, you won’t spend too much time working on tasks that can wait. Instead, you’ll pay attention to urgent tasks that play a big role in the product roadmap journey. 

5. Align stakeholders and teams 

The last thing a business needs is for the stakeholders and teams to be at loggerheads with each other. And the best way to prevent this from happening is to present data as the backbone of all decisions made. 

Numbers don’t lie—and conflict is less likely to happen when the stakeholders and marketing team understand where the business is based on the data presented. For instance, if the marketing team thinks that people are not signing up for the product because they’re targeting the wrong audience, they’d be able to use numbers to back up their argument.

​​How different kinds of data power product-led growth

There are four major types of data that marketing operators use to inform their product-led growth strategy. Here’s how each of these data types influences PLG: 

1. Market research data 

You could build the best yacht to ever exist, but it’ll be of no use in a desert. The same goes for your product. No matter how great it is, it may fail if you market it to people who have no use for it. 

To find out if a group of people needs your solution, you’ll need to conduct market research, including consumer insights, brand positioning analysis, competitor analysis, and user segmentation. This research helps marketing teams: 

  • Collect insights into the needs, behaviors, and motivations of target users
  • Validate ideas—which prevents them from creating features/products that nobody wants
  • Understand what their competitors are doing and how they can fill in the gaps that competitors have not yet fulfilled with their target audience
Illustration Of Breadcrumbs Icp Worksheet


Ideal Customer Profile (ICP) Worksheet

Learn how to create an Ideal Customer Profile and build a successful sales strategy with this Ideal Customer Profile (ICP) Worksheet.

2. Marketing data

Growing a company that operates on a product-led growth model can only happen when you collect data from your marketing campaigns and advertising efforts. 

The information that marketing teams gather informs the kind of messaging frameworks that they’ll use in their product guides and landing page copy. They’ll also know the best product-first strategies to introduce qualified leads to the platform. For instance, they’ll know if a free trial works better than a freemium plan for customer acquisition. 

As a marketing operations manager, these assets help you position your product well so that your ideal buyer persona is able to find it and gain value from it in no time.

3. Customer data 

In product-led companies, customer success teams are responsible for listening to and helping customers who have questions about the product, need some help with onboarding, or want to use the product for a peculiar purpose. They also conduct user interviews to get to know what customers think of the product and how it has helped them.

This means that they have a wealth of knowledge about the problems customers are having, the questions they ask, and what they use the product for. Relaying this information to the marketing team helps them understand the product features that customers actually need.

When existing customers have been using the product for some time, customer success teams may roll out customer satisfaction surveys and collect Net Promoter Scores (NPS)—which show just how satisfied your customers are with your product and how likely they are to recommend it to other people. 

4. Product data

Product teams are typically in charge of collecting product data through user flows, heatmaps, and metadata. This data shows how customers behave inside your product, whether it’s an app, website, or software. 

When product teams track what goes on in the product, they’ll be able to determine how many people complete onboarding successfully, which features users use the most, and where people drop off. Product data can also reveal new opportunities for innovation or even an angle that the marketing team wouldn’t have considered otherwise.

Aligning your metrics with PLG strategy

To know if your marketing efforts are yielding any fruits, your marketing teams should use SaaS metrics to track growth. However, there are hundreds—if not thousands—of SaaS metrics out there, so companies that run on the product-led growth model have to use metrics that align with their strategy. 

Since product-led companies want people to move from free trials to paid plans and become long-term users, their metrics typically revolve around customer acquisition, activation/onboarding, revenue, customer retention, and referrals. Let’s see what these categories entail: 

1. Customer acquisition

The first goal of product-led companies is to get prospects into their pipeline. They do this primarily through product demos and free trials. So you want to track the number of people that ask for demos and sign up for a free trial. You may also track other acquisition-based metrics like: 

Once a substantial number of leads have signed up for free trials, it’s important for companies to identify the ones that are most likely to upgrade to paid plans. This is where lead scoring comes in.

Lead scoring involves assigning a numerical value to your leads to indicate their level of interest in your product. Some companies, however, forgo numbers entirely and use the terms “hot”, “warm”, and “cold” to denote how likely their leads are to move down the buyer funnel.

Product-led companies typically use lead-scoring tools like Breadcrumbs to identify and rank their leads. After scoring their leads, marketing and product teams focus on the users who demonstrated the most interest in the product.

2. Activation/onboarding 

Once a person signs up for a free trial, they’re typically supposed to complete a set of tasks within the product to get familiar with and receive value from the features. For example, the list for a word processor could look like this: 

  • Make a document 
  • Save a document 
  • Print a document 
  • Turn a .doc file to .pdf 

As a product-led company, you’ll need to track the number of users who finished—or almost finished—the onboarding tasks. Someone who does 80% of the tasks is more likely to sign up for paid plans than a user who did only 40%.

Some activation-based metrics you can track are:

  • Activation rate
  • Visitor-to-signup rate
  • Product stickiness
  • Trial-to-paid conversion rate
  • Feature adoption rate

3. Revenue

When users convert, they’ll subscribe to (one of) your product’s paid plans and become customers. The longer they use your product, the more money you make and the more willing they are to pay for extra features. So to correctly measure revenue, you may track these metrics:

  • Monthly recurring revenue (MRR)
  • Revenue churn rate
  • Net revenue (after removing business expenses)
  • Customer lifetime value (CLV)
  • Months to recover CAC 
  • CAC-to-LTV ratio

4. Customer retention

Once a user signs up for your product’s paid plans, the next step would be to satisfy them so much that they keep coming back to engage with your product. Since it’s more costly to acquire customers than to retain them, you want to focus on measuring and improving customer retention and reducing churn as much as possible. 

Here are some customer retention-focused metrics you should track:

You could also track the most important actions or activities performed multiple times by users. Not only can these actions or features lead to more retention, but they could even become your north star metric.

Another method you can use is lead scoring. While lead scoring is commonly associated with acquisition, it can also be crucial to customer retention.

You can pinpoint disengaged or dissatisfied customers when using a sophisticated lead scoring tool like Breadcrumbs. By monitoring metrics such as product usage, support ticket frequency, and communication patterns, you can create an exhaustive scoring model to identify at-risk customers before they leave.

This empowers your team to take timely action, engaging with these customers to understand their needs, resolve issues, and reinforce the value of your product or service.

5. Referrals 

When users love your product, they usually recommend it to their network of friends and/or co-workers. Tracking referrals helps you understand just how well your company is growing by word-of-mouth alone, which can impact how much resources you allocate for product and content marketing

Many product-led companies set up referral programs, offering their customers an incentive (usually monetary or discount-based) if they get other people to sign up for the product. If you run a program like this—or are planning to—here are some referral-based metrics you should track:

  • Number of referrers 
  • % of customers who become referrers 
  • Click-through rate (for referrals sent)
  • Conversions (for customers who sign up via a referral)

As you align the metrics you track to your product-led growth strategy, determine which teams and/or individuals are responsible for “owning” each metric. Identify which platforms you’ll use to track and integrate these metrics and the strategies your teams will employ to grow these strategies.

Use data to drive business decisions and grow your product-led business

Gathering and analyzing data is integral to the successful management of a product and the execution of an effective product-led growth strategy. But data shouldn’t be limited to marketing teams only; it should be used at every level of the organization. When you evaluate data from across all the teams in the organization, you can make informed decisions that drive business growth.

Don’t miss out on the opportunity to propel your product-led business forward using lead scoring data in your PLG strategy. Start using Breadcrumbs for free today to unlock valuable insights and accelerate your journey toward success.

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About the author

Althea Storm

Althea Storm is a B2B SaaS writer who specializes in creating data-driven content that drives traffic and increases conversions for businesses—small startups and large businesses alike. She has worked with top companies like AdEspresso, HubSpot, Thinkific, and Zapier.

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