February may be creeping in, but we’re still on that new year grind—with 14 tech trends to watch closely in 2020. Plus we’ve got Chargify’s Michael Klett and our very own Patrick Campbell to share their billing and pricing predictions. And we connect with OpenView’s Blake Bartlett on product-led growth.
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Unicorns buying unicorns
The $8 trillion opportunity in wellness tech. Empathy in design. Killer robots. These are some of the top tech trends poised to reshape industries in 2020, according to CB Insights.
From 5G networks to the next wave of AR and VR, no industry is immune.
The trends in this Tech Trends Report, while backed by data of course, are meant to “shake our faith in steady trend lines.” Apparently, they highlight areas in which conditions are ripe for discontinuity and disruption.
Using CB Insights' tech insights platform, the team there, analyzed signals—like patent and investment activity, executive chatter in earnings transcripts, and media mentions—to identify the top 14 tech trends to watch in 2020.
And the 68-page report digs into trends like:
Apple doubling down on healthcare products and services
AI bias becoming a top regulatory concern
Radical biohacking (it's a thing), i.e., biohackers pushing medical devices and regulators to the brink
And empathy becoming a must-have in tech product design and development
So how will this one affect your business (or you in general)? See for yourself.
And what tops the list? None other than custom pricing. Which essentially means: Having the ability to customize your price on a person-by-person or segment-by-segment basis. This might mean having certain prices for some segments and certain prices for other segments or it might mean having more complicated pricing that’s not just per user or per hundred visits or thousand contacts, for example.
And Michael agrees. Custom pricing has been the realm of the enterprise for a long time. Enterprise companies lend themselves more seamlessly to charging per customer and matching a price to a customer. But the tools are getting better. Companies are realizing that maybe their product isn’t one size fits all. The realization is that there isn’t one per-price that really works.
"As the tools evolve, it makes it easier for the non enterprise to start to charge custom pricing for each of their users."
As usual, there is so much more where this came from. Check out the full LinkedIn Live and let us know what you think. Email me at firstname.lastname@example.org if you have your own predictions, or input on the intel Michael and Patrick dropped.
Why go product-first? A Q&A with Blake Bartlett
Blake Bartlett over at OpenView, the expansion-stage venture capital firm, chatted with me a bit about product-led growth. He had written an extensive piece on PLG for the OpenView blog, called What is Product Led Growth? How to Build a Software Company in the End User Era, and I wanted to pick his brain on it.
Thanks for hanging with us Blake. First off, what is product-led growth at its core?
“Product-led growth is a go-to-market strategy that relies on the product itself as the primary driver of customer acquisition, conversion, and expansion.”
Ok, but how can we more easily conceptualize this?
“I would say the easiest way to conceptualize what that is, is to ask yourself: How did your company adopt Slack? And what I know is true is that your company did not adopt Slack because you went to some random trade show and walked up to the Slack booth and said, ‘What is this thing?’ and started using it later, right? You also didn’t start using it because you got a cold call from a SDR pitching you on this tool that you’ve never heard of.”
And what’s up with the bottoms-up approach? In the piece, you use Slack as an example. Can you walk us through that?
“You adopted Slack because individual end users at your company found it to be helpful and started communicating on it and it spread like wildfire, and now everybody uses it. It’s this bottoms-up motion, traditionally what people have referred to this as, this means of distributing software...
But bottoms-up, while it’s accurate in describing that it goes through the individual employees up the organization, and then eventually gets executive budget, it just didn’t seem to be particularly descriptive of how these companies actually operate on a day-to-day basis. What we saw in our portfolio companies—like Expensify and Calendly and Datadog—was that they were fundamentally leading with product.”
You mention a slew of assets that matter with PLG—design, ease of use, delivering value before hitting a paywall, for example. Do any of these carry more weight than the next? Or this simply, one bundled package, and you need it all?
“You need to orient toward the end user, both in terms of the product that you build, you actually have to solve and alleviate their pain, not their boss’ pain, but their pain directly. And then you have to make it something that they can actually adopt on their own.”
And you claim that sales should be hired last when dealing with a product-led growth initiative. Why is that? How does this differ from a more traditional growth approach?
“In product-led growth, product leads and sales follows. The product goes and lands initially, and there’s some initial sort of viral adoption of the product, like a Slack or like Dropbox for Business or like Zoom—and then once you see that initial adoption, then that’s a great time for customer success to call in or for sales to call in. And to make sure that, that initial set of users inside an account are actually getting value out of it...
But again, since you’re going to individual end users, directing sales resources to try to convert individuals just doesn’t make a lot of sense. So let the individuals adopt the product. Let it spread amongst themselves and then once you see that initial sort of kernel of adoption, lob sales in to help continue the journey that product started.”
Ultimately, what do you hope we get out of this piece?
“It’s the year 2020. Salesforce started SaaS two decades ago and for the last two decades we’ve been talking about the same best practices, the same SaaS metrics, the same orientation to, ‘How can you do better inbound marketing? How can you do better inside sales? How can you get your CAC to LTV to be better?'
But the world has fundamentally shifted and end users are now finding software solutions, buying them and telling their boss which ones are going to get budget. And so if you’re playing the game that’s been played for the last two decades—the Salesforce game—it’s gonna hurt in the next decade. 2020 to 2030, that’s going to just be increasingly less effective and the end-user era is here, so build a product for end users, not for their boss, and then distribute to end users through self-service.”