The future of growth is product-led. Data shows that companies leveraging a Product-Led Growth strategy perform better on average – faster growth, higher margins, lower burn and stronger valuation multiples. Product-Led Growth will soon become the norm, making it table stakes for SaaS companies that want to win in their markets. What is your company doing to adapt to the product led growth revolution?
Blake BartlettProduct-Led VC @ OpenView
Introduction
I’m pretty sure you’ll be familiar with the concept of Product-Led Growth (or PLG) that’s taking the digital technology sector by storm. As the business landscape becomes more complex, competitive and cost-focused, product-led growth is gaining momentum as an impactful and cost effective growth strategy.
Many organizations want to embrace product-led growth (or maybe they have to if they want to survive, let alone grow), however they are unable to get there because in order to realize product-led growth you have to be able to manage user feedback really well because a critical factor in product-led growth is knowing what users need and being able to meet those needs.
If you can’t manage user feedback efficiently and cost-effectively, successful product-led growth is almost impossible.
But even today many product teams struggle with managing user feedback — so much so that they often have no idea what their users really want from them or how well their products are performing relative to competitors.
If you’re looking for ways to make product-led growth a reality for your product — whether you’re a founder, product manager, marketer read on! In this blog post we’ll discuss 9 ways to streamline user feedback management to optimize and accelerate product-led growth.
What is product-led growth?
At it’s core Product-Led Growth is about creating a great product that sells itself, rather than relying on traditional sales and marketing activities like advertising and sales reps. With Product-Led Growth your product is more than just a product… it’s at the center of the customer experience and acts as your primary acquisition tool for driving sign-ups, sales, activation and retention.
Product-led growth organizations might offer free trials and freemium versions with limited features; or they may invest time and money in finding the most effective solution to specific pain points that users may face.
Blake Bartlett, an investment partner at TA Ventures, coined the term in 2016 after observing the growth of SaaS companies Datadog and Expensify. Bartlett noted these B2B companies served a wide range of consumers without breaking the bank on marketing and sales because their products did those jobs for them.
Two of the best-known product-led growth success stories are those of Spotify and Slack:
Spotify
This music streaming service has over 515 million users and is one of the most popular apps in the world. The company was founded by Daniel Ek, who recognized that there were no good ways for people to find new music online. He set out to build a solution that would change that, and today people use Spotify for everything from discovering new artists to listening on their way home from work.
Slack
Now used by 43% of Fortune 100 businesses, this messaging app helps companies stay connected and productive by making it easy for teams from different locations or departments within an organization to communicate with each other throughout the day.
Slack was co-founded by Stewart Butterfield and Serguei Mourachov when they realized there were no good tools available for them as employees at another company who needed quick access across multiple projects while working remotely.
The importance of user feedback in product-led growth
Even though the label for this approach is “PRODUCT-led growth”, users have a critical role to play, from how the product functions to how it is sold. User feedback is the gateway to the user insights that inform the decisions that both shape a product-led growth strategy and help to determine why it may or may not be working.
To learn more about the different types of user feedback check out our recent article: Power up your feedback loop! 15 ways to collect actionable insights from your users.
9 characteristics of product-led growth that rely upon being able to manage user feedback effectively
There are a whole range of reasons why a product-led growth approach might succeed or fail. The ability to manage user feedback is one of them and we have identified some key characteristics of product-led growth that depend upon user feedback management:
User-Centered
Bartlett highlighted that whatever they do, product-led growth organizations always focus on their users.
When you make sure your customers are happy with your products or services then they keep using it. Any changes you make to the product should be based on user feedback rather than intuition alone.
A report by Microsoft discovered that 77% of consumers view brands more favorably if they seek out and apply customer feedback.
However, when they’re not able to manage user and customer feedback effectively to inform user-centered decisions, many organizations prioritize features and functionality based on their own opinion, or based on the vision of key stakeholders… which can be out of synch with what users actually need. If this happens the organization is in danger of creating a feature factory that fails to deliver product-led growth as the product fails to meet user needs.
There is a growing movement towards User-Centered Product Development (or UCPD) to ensure that users are engaged throughout the product development lifecycle to ensure user needs are met and that the feature factory is avoided.
Read more about how organizations are adopting UCPD in our recent report: The State of User-Centered Development 2023
Responsive
In an increasingly complex and dynamic market environment, product-led growth requires agility, which in turn requires user insight.
How efficiently you can collect, assess and action user feedback will determine how quickly you can respond to market need — in the form of feature requests — or simply fix things that aren’t working the way they should — in the form of bug reports.
There is plenty of evidence to show that organizations that are slow to respond to user needs are quick to lose customers! As an example, research by Forrester shows that 77% of customers say that valuing their time is the most important thing a company can do to provide them with good service.
At the end of the day, if you respond to user feedback quickly it shows that you respect your users and you value their time. This improves customer satisfaction and retention. And it makes them more likely to share what you have to offer wth others.
Viral
When users are happy with your product not only do they keep coming back for more… they tell others.
Word-of-mouse referrals are a key factor in the success of many product-led growth applications, for example Spotify, Slack, Canva, Dropbox and more. Because many of these products feature a significant sharing component they are inherently viral… it’s part of how they work.
When you know what users like about your product, you can amplify the viral spread by encouraging users to share the most popular features within their networks. When you know what they don’t like, or what doesn’t work the way it should, and you can fix it quickly to remove any barriers to referral.
According to Deloitte, customers tell an average of nine people about a positive experience with a brand, but they tell 16 people about a negative experience. That doesn’t help product-led growth!
Rewarding
When you reward users it can help to increase usage, retention and word-of-mouse. But it helps to know what they want
User feedback helps to establish how users feel about any rewards that you currently offer and what you could be doing to increase. According to a PLG Collective benchmark report on the current state of product-led growth, companies using gamification in their products to engage and reward users have increased their conversion rates by 7 times compared to those who don’t use gamification.
2022’s Vonage Global Customer Engagement Report found that the top reason customers switch brands is because they feel unappreciated.
Intuitive
To realize product-led growth users need to be able to use your product on their own without any third party assistance or instruction.
If you want to create a user experience that’s easy to use you need to be able to understand where your application may not be user providing an intuitive, user-friendly user experience and intuitive interfaces. This means you need to know where there may be areas that are not delivering.
“Companies that use a product-led growth strategy create products that speak for themselves. They achieve this by focusing on a number of elements, including…user-friendly interfaces, websites, and touchpoints.” Hubspot: Product-Led Growth: Examples and Benefits.
No (or low) cost of entry
To lower the barrier of entry, many product-led growth strategies start with a free or freemium model that gets people using the product
According to The State of Product-Led Growth 2023 report, 41.5% of product-led growth organizations choose to offer a free trial and 36.9% offer freemium services.
By collecting feedback from users who are using the free version of their product, product-led growth organizations can identify areas where the product can be improved and deliver greater value to users, which can encourage new users to sign-up for free or trial versions and existing users to upgrade to the paid version with more advanced features.
Easy Onboarding
The user onboarding experience is the first impression you get to make with customers. You need to make sure it’s a good first impression.
If your user onboarding process is not well-designed, it can leave users feeling frustrated or confused. This can be a huge barrier to success as users are then less likely to use the product or tell others about it.
User feedback can highlight any friction in the onboarding process as well as those moments that “surprise and delight” your new users. These insights can then be used to improve the onboarding process or identify where additional in-app prompts or cues are required to overcome friction points.
Rapid Time to Value
The sooner you can add value to a user, the more likely you are going to earn their loyalty and trust.
Once you’re signed up with Canva, you’re able to create a design within 3 clicks… that’s pretty impressive in terms of time to value!
Product-led growth organizations need user feedback to understand how best to accelerate time to value for their users by analyzing the customer journey through insights and trends. Surveys, experiments, and discovery sessions allow them to understand user needs and pain points so they can improve their product experience. By making it easy for customers to sign up, quickly get value from the product, achieve their jobs-to-be-done, and share their positive experiences with others, product-led growth organizations are better positioned to attract, convert and retain users.
Communication
When you keep your users in the loop it helps to build loyalty, trust and even a shared sense of ownership.
From collection to closure it’s important to keep users in the loop. Acknowledge their feedback to show them that you’re listening, taking their needs seriously and responding to their feedback. This helps to build long term trust, loyalty and retention.
Following up with users after they provide feedback can help build a relationship and show that you are committed to improving their experience.
And what if you don’t keep them in the loop? Well, 68% of customers say they’ll leave a company because they believe the company is indifferent to them.
By prioritizing development based on user feedback, companies can ensure that their product remains relevant and useful to their target audience. This will help to build a loyal user base and attract new users to the product over time. Ultimately, this will lead to a more successful product and a more satisfied user base.
So where is it going wrong for so many organizations?
If you’re struggling to make product-led growth a reality, are you facing any of these challenges when it comes to managing user feedback:
- Disconnected and manual methods to manage user feedback — such as email, spreadsheets, phone-calls and even Post-It notes?
- Little or no consistency in how feedback is collected?
- Receiving ambiguous and subjective feedback?
- Assessing and managing user feedback is time-consuming and frustrating — you have to go back to users to ask them what they mean exactly or what steps they were taking before an issue?
- Developers spend too much time fixing bugs rather than building new features and functionality?
- Taking too long to respond to feedback resulting in lost opportunities, trust or loyalty?
- Struggling to integrate user feedback into existing workflows and processes?
- You can’t decide what features and functionality to prioritize?
- Your product roadmap is not going where it should?
- Users are left in the dark not knowing if they’ve been heard or that their issues have been closed?
- User feedback is seen as a drag rather than an opportunity to deliver a better product experience?
If the answer is ‘yes’ to one or more of these issues then your user feedback loop is probably more like a tangled knot, almost impossible to manage, let alone action.
You need to untangle that user feedback knot before you can expect to successfully realize product-led growth.
“When user feedback gets in a knot the velocity of your product development can be impacted because you lose clarity on user preference. Much worse is that you may build the wrong things. Product teams need to become focused on driving customer outcomes. Failure to deeply understand users means that R&D investment isn’t aligned with customer outcomes. This is a profound business risk.”
Karl Rumelhart, Chief Product Officer and Executive Vice President of Engineering @ Gainsight
Learn more from Karl and other global Product Managers in Userback’s eGuide: Untangle the User Feedback Knot
What makes Userback the ideal user feedback platform for product-led growth?
User feedback is the lifeblood of product-led growth. And if you’re looking to nail product-led growth, Userback is the perfect tool for collecting and managing user feedback so you can stay ahead of the game.
Userback gives businesses the ability to manage the entire user feedback lifecycle, from collection to closure. With its powerful feedback and collaboration features, you can continuously and cost-effectively gather valuable insights from your users, make informed decisions and take the necessary action to improve your product:
Real time feedback:
Userback allows you to collect actionable feedback directly from your users in real-time, so you can quickly identify pain points and areas for improvement. Our in-app widget allows your users to submit bug reports, feature requests and general feedback without leaving your environment. They can capture screengrabs, record videos, scribble notes, draw on the screen, add any annotations and then directly share their feedback with a single click — no more back-and-forth in emails or spreadsheets!
This gives you the user-centered feedback you need to continuously improve your product, identify potential roadblocks and make timely adjustments.
Learn more about Userback’s:
All the information you need to create features and fix stuff fast
Every piece of feedback comes with the relevant user and session information so you know exactly what the operating environment that they are using. Your developers get instant access to all that background information they need to fix stuff fast.
When you run Session Replays the user doesn’t even have to tell you what was going on… you can see a video-like recording of the user session detailing every interaction leading up to a specific event or issue. This information saves developers significant time when investigating and replicating issues.
Learn more about Userback’s
Collaboration:
From on-screen annotation to assigning tasks, Userback features a range of collaboration tools that enable users, product managers and software teams to communicate better and ultimately work together to improve your product.
Integration:
Userback easily integrates with popular project management and collaboration tools, such as Trello, Slack, and Jira, making it easy to incorporate feedback into your existing product development process. Alternatively, Userback can be used standalone as an end-to-end user feedback management platform.
Feedback portal:
A unique feature of Userback is its Feedback Portal, which allows teams to collect and organize feature requests while letting users vote and comment on what matters most to them. This helps you to determine which feedback to prioritize based on its impact on your product’s success, such as improving user experience, increasing revenue, or reducing churn. The feedback portal shows customers that you are listening and taking their needs seriously, helping to build trust and loyalty.
Conclusion
Realizing and accelerating product-led growth can dramatically impact the success of your organization by allowing you to reach a wider audience, deliver a better user experience and respond to user needs faster.
User feedback is a vital component of product-led growth and using a platform like Userback to streamline and automate the collection and management process is integral to acquiring actionable insights quickly and reliably.
With Userback, organizations can take their product-led growth initiatives to the next level by optimizing user engagement, making data-driven decisions with ease, delivering greater customer satisfaction and enhancing their overall product-led growth efforts in real-time.
Get started with Userback today and fastrack your journey to product-led growth!
About Userback
Founded in Australia in 2016, Userback is a market-leading user feedback platform helping 20,000+ software teams to understand what customers need so they can build better web applications, faster.
Userback streamlines and automates the realtime in-app collection, evaluation and management of visual feedback and contextual surveys. Userback can be used standalone or seamlessly integrated into existing business workflows to allow product managers and developers to validate ideas, optimize product-market fit, refine roadmaps, prioritize features, fix bugs and deliver value with greater insight, impact and efficiency.
Start free at userback.io/signup
Power up your feedback loop with The Ultimate Guide to User Feedback for Product Managers
If you enjoyed this article, you might want to download The Ultimate Guide to User Feedback Management. From collection to closure, this comprehensive eBook highlights what you can be doing to streamline your user feedback processes and better understand what your users need in order to deliver the features they want, faster!
