According to the 2022 report by OpenView, adoption of Product-Led Growth(PLG) is up by 20% over the last three years and with the looming economic climate, more companies are expected to pursue this strategy. A key characteristic of a PLG strategy is the ability to drive business growth while reducing customer acquisition costs. A successful growth strategy is contingent on the keen understanding of the customer lifecycle, where marketing and product teams often have a significant impact.
Yet, regardless of an organization's size, marketing and product tend to operate in silos. Misalignment of goals and overlapping duties can create friction between the two disciplines, potentially stalling initiatives and impacting revenue. Establishing a partnership between marketing and product can be a source of growth for all companies, and a starting point for those seeking to be product-led.
WHAT CAN PRODUCT BRING TO MARKETING
One way in which product management can help marketing is by providing in-depth knowledge of the product. Particularly around retention and the value existing customers derive from the product. This knowledge can be integral to marketing teams when developing campaigns and messaging to grow awareness.
For example, as the product manager at a previous MarTech startup, much of the messaging centered around the ability to upload and manage images in various file formats for use in marketing materials. This landed well with smaller companies but many larger enterprises already had software in place to manage imagery, and it would have been too costly to switch to our product.
On the product team, we understood from data and feedback that our enterprise customers favored the content management system (CMS) and content API. The API allowed enterprises to aggregate all brand content, not just images, scattered across different sources into the CMS and use that content to create stronger marketing materials.
Another misconception was regarding the size of customer brand teams. Initially, there was an assumption that enterprises had large enough teams to dedicate 1 or more people to only manage brand content. However, through customer interviews, we confirmed teams were relatively the same size across companies and often the designer constructing marketing templates was also responsible for the content management.
These insights led to the marketing team adjusting their communication to highlight the power of consolidating brand content and how easily it could be managed. The eventual result was that we converted two Fortune 500 companies into customers.
Similarly, product management can help marketing better understand user engagement. Marketing can leverage trends to get ahead of competitors and promote other product capabilities that drive value for customers. At the same startup, we noticed increased usage in the design template import tools as more content was added to the CMS. Partnering with marketing, our messaging was updated to include that teams can leverage their content immediately and setup marketing campaigns by importing templates.
WHAT CAN MARKETING BRING TO PRODUCT
“My teams need to know how does this product help them daily?”
While investigating adoption issues, this comment was uttered by a stakeholder in my first weeks as a product manager for a project management tool. Similar comments arose in conversations thereafter and I discovered that the source of discontent was primarily due to ineffective communication of updates. The features that would address their problems were there but no one was aware. According to Productboard’s 2022 product excellence report, 54% of product managers struggle with feature communication to customers. Marketing teams likely have a system in place, and can partner with product to identify the best methods and channels to deliver feature updates.
Marketing teams can also provide feedback on product positioning and messaging. Using this feedback, product managers can further understand the customer’s perception of the product and refine how they articulate value.
For instance, a major pain point for the previous project management stakeholders and their teams were timesheets. The current process was confusing leading to many late submissions or missing timesheet, which had a direct impact on revenue. With this in mind, I tailored my communication to highlight the timesheet capabilities and straightforward submission process.
Another area marketing can partner with product on is market research. Product managers should already be doing some amount of market research however some studies have stated only 4.8% of a product manager’s time goes to market research. Marketing can support by sharing additional insights on customer needs and preferences, which can then used by product managers to identify areas for improvement. Using the previous MarTech startup as an example, market research indicated that customers were consistently looking for support of a particular design software to use for template import. As the product manager, I prioritized any development that would support the tool and ensure the our app could import any templates files form the design software without issues.
WHEN THERE IS A DISCONNECT
A disconnect between product management and marketing can result in a lack of business growth and missed opportunities, specifically around awareness, acquisition and retention.
One example is when the marketing team is focused on promoting the product to a certain segment of the market, but the product team has not developed the product with that segment in mind. In this situation, what was marketed did not align with the the capabilities of the product. In some cases this could even lead to customer churn.
Another example of a disconnect is when the product team is focused on developing new features for the product, but the marketing team is not aware of these features or how to effectively promote them. In this situation, the product team may be disappointed with the customer interest, while the marketing team may be frustrated with the product team for not providing them with the information they need to effectively promote the product. As seen in the project management example, customers were unhappy with the product despite the features being there.
CREATING A CONNECTION
Set Expectations
Although it may be more apparent at smaller organizations, overlapping duties can cause friction between marketing and product teams. Many organizations also mistakenly assume that becoming product-led means that product management is the boss, increasing the divide between teams. While good product management is important to being product-led, the strategy requires all teams to come together to drive growth. In both cases, it’s important for marketing and product teams to establish a mutual understanding of each other’s role and duties, and reinforce their importance to driving growth.
Communicate Frequently
The frequency will differ between organizations but establishing a regular communication cadence can prevent misalignment. For instance, at some previous companies, I would have a weekly meeting to discuss the direction of the product and how it will be marketed, and joint brainstorming sessions to come up with new ideas and strategies.
These meetings also gave the marketing team an opportunity to provide input on the product roadmap and involve them in user research and testing. Working together from the start creates a sense of shared ownership between the two teams.
Align on Goals
It can be helpful to create a shared set of goals and metrics that both teams can work towards. This could include goals related to user acquisition, customer retention, and revenue growth. As with the meetings, this creates accountability across the two teams and incentives both to collaborate closely. Note that for growth teams, initiatives should already be focused on improving one or more customer metrics.
These recommendations seem obvious but siloed efforts continue to be a challenge for many organizations.
CONCLUSION Product-led growth (PLG) is a business strategy that requires cohesion across multiple functions in an organization, particularly between marketing and product. This connection can be beneficial for all companies regardless of their growth strategy and an entry point for teams starting their PLG journey. Product-led often is mistaken to mean that the product management is at the helm which could lead to friction between marketing and product, where there is overlap. Alignment around areas of ownership and goals, and understanding of priorities can mitigate this. Disconnects between marketing and product could stall growth efforts and potentially impact revenue.