The fastest growing and leading SaaS companies all leverage integrations to supercharge their apps' product-led growth (PLG) flywheels.
By offering more native integrations to your customers, you’ll be able to improve the core metrics across every step of the user funnel, from acquisition all the way to increasing NRR. Let's dive into the details.
TL;DR
- SaaS companies are increasingly focused on building a product-led growth/product-led sales model, with a blurring of responsibilities between major roles like sales, marketing and product
- Integrations reduce Time to Value because they save your customer from having to manually connect your app to their tech stack before they can start using it
- Customers who activate your product's integrations are far less likely to churn, as they will have built operational dependencies on your product
- Native integrations can generate expansion revenue for SaaS companies, by capturing the value and efficiency created through a variety of integration pricing models
- To discover the specific product-led integrations that your customers need, there’s no substitute for in-depth customer interviews and proper discovery
- Product & engineering team leverage Paragon to rapidly ship the integrations that their customers need so they can accelerate their product-led flywheel
The Product-Led Landscape
Top VC firm, OpenView observed that every single top IPO in 2019 involved a company with a product-led model. 3 years later, the trend towards product-led growth shows no signs of stopping.
More and more, end users prefer to try new products themselves before they buy them, as opposed to speaking to a salesperson. If a salesperson is involved in the buying process at all, it’s more as a product consultant than as someone only skilled in the arts of listening and persuasion.
Put another way, salespeople are increasingly supporting product-led revenue by helping customers with onboarding, rather than being drivers of revenue themselves.
For old-school types who expect onboarding to still be the sole domain of customer support, this continues to be a surprise. But it’s part of an ongoing movement towards the blurring of the boundaries between sales, marketing and customer success.
Previously, responsibility for a customer could be neatly passed from the sales department to customer success after the user made their first payment. But in an age where that user has interacted with self-service onboarding, self-service support and numerous parts of the product before becoming a paying customer, it’s no longer clear where one department’s responsibility begins and another’s ends.
Why integrations are crucial for product led
A good example of a company that’s embraced a product-led growth strategy facilitated by integrations is Pendo. Specifically, Pendo has recognized the following three truths:
- Users need to be able to onboard themselves quickly, without waiting on manual integrations that might take weeks.
- A user who has onboarded and activated is less likely to leave a sticky product that’s integrated into their broader systems architecture.
- The fact that business users need data that’s strewn across multiple platforms in order to make good decisions creates the strategy to offer them integrations as an upsell.
Let’s explore each of these points in more detail.
Seamless Onboarding
It’s in the interests of every software company to onboard their new users as quickly and efficiently as possible. The lower your Time to Value, the faster your customers are going to start using your product to solve the problem that they came to you for.
If your user has to waste time manually integrating auxiliary pieces of software into your product before they can get any value out of it, you can be confident that they’re going to churn in no time.
For example, someone using sales software like Outreach shouldn’t have to manually export lead data from their CRM before they can start qualifying leads and selling to them. One reason Outreach has been so widely adopted is because they offer so many automated integrations to CRMs like Hubspot and Zoominfo.
Increase Product Adoption and Stickiness
If businesses have an incentive to make their products easy to adopt, it follows that they have an equally compelling incentive to make it hard for customers to stop using their products.
When it comes to the value of integrations in making products harder to give up (or more “sticky”), the example of Typeform is an instructive one.
Although most of Typeform’s customers use its software for one-off survey creation, the company noticed that its best customers were integrating Typeforms into their website architecture as contact forms and payment collection forms.
Why were those customers more likely to be retained for longer? It’s because once they integrated Typeform into their websites and began using it for lead capture/surveying, they will have built processes that would make it much more difficult to 'rip out'.
And as a bonus, the presence of Typeform as an optional add-on on platforms like Wordpress has made it easier for customers to discover and adopt Typeform in the first place.
Upsell Progression
You can also leverage product-led integrations to upsell your users into a higher pricing tier. When you consider how much time your B2B customers would have to waste in going to a platform like Zapier and doing all the work of setting up the integration on their own, it’s not hard to see why many of them will pay extra to have that work done for them.
If you’re trying to figure out which integrations should go into which pricing tier, consider the following three approaches:
- Look at the audience of the software you’re integrating with. Software targeted at smaller customers belongs in a lower pricing tier, and software targeted at enterprise buyers belongs in a higher tier, and so on.
- Look at how many integrations each pricing tier has. The higher the price, the greater the number of integrations offered.
- Look at how much value each integration offers. Customers should expect to pay more for the integrations that offer the most value.
Now that you’ve understood why integrations are valuable, you might be wondering: which specific integrations should you offer your customers?
The Must-Have Integrations
Regardless of what your business does, there are four types of integration that will add value to almost every SaaS company.
System of Record Integrations
If your customers are like most businesses, they use about 110 different applications across their entire organization. To prevent information about their own customers from becoming siloed and to maintain a source of truth, most companies have a system of record. In many cases, they'll use a CRM like Salesforce, HubSpot or Dynamics as a central repository for all their customer data. However, other types of system of records may be used depending on the vertical, such as platforms like Gusto/ADP for HR.
Why do you need these integrations?
Imagine juggling but one hand doesn't know what the other hand is doing. You're going to drop the balls.
Applying this idea to SaaS, if you sell email marketing software and your customer uses it in a vacuum, they’d run into frustrating situations, such as sending a lead an automated break-up email in the same instance that the same lead has already scheduled a demo call with their sales team. (Don’t do this!)
By integrating with their system of record, you'll not only ensure that your app has the most up to date data from their operations, but your customers will also derive more value from your app's data. This is especially important for retention, as most users spend the majority of their time in their chosen system of record solution.
Communications Integrations
It’s also a good idea to build integrations with communications platforms like Slack and Teams into your product.
Given how ubiquitous such platforms have become over the last two years, there’s a high chance that your customers spend most of their days on them. If your app creates Slack notifications whenever critical events occur within your app, you’ll stay top of mind, leading to better retention. And if those notifications go to group channels, you’ll automatically build broader awareness of your product across your customer’s organization.
Consider also that it will take some time for your customer to get into the habit of using your product every day. If they can manage notifications and communications through Slack rather than going into your app, that reduces the mental friction associated with using your product.
CDPs
Most likely, you’ll find that your customers want your app to integrate with their CDP as well. By CDP, I mean a customer data platform like Segment, Blueshift or Totango.
If you’re wondering why it’s necessary to integrate with both your customer’s CRM and their CDP, it’s because the two types of platform are similar, but subtly different. Your customer’s CRM is a central repository for manually-created data from customer-facing interactions like sales, while their CDP is the place they automatically pipe data from different platforms across their organization.
By passing data from your app to their CDP, your customer will ensure that they have all their business data in one place. This creates additional value from the data that lives within your app.
Productivity Apps
Almost every team uses some kind of productivity tool, whether it’s something as simple as Google Calendar, or a project management suite like Asana, Jira, or ClickUp.
If you integrate your software with these kinds of tools, you’ll ensure that tasks or events from your product show up on the platforms that your customer is already using every day. This means your product fits more deeply within your customers' workflow', while making your solution more visible to additional members from your customers' organizations.
Use case-specific integrations
While the above product-led integrations will add value to almost any business, the full list of the integrations you should create will heavily depend on your product’s particular value proposition.
To achieve product-led growth, you’ll need to develop advocates for your solution across multiple departments in your customer’s organization, and understand how you can provide integrations to add value to all of those use cases that you’ll discover.
Workflow discovery
Practically, the best way to do this is to find out as much about your ideal customer’s tech stack as possible, and then design your integrations with that tech stack in mind.
The easiest way to find out which tools they use is to ask them directly.
If a customer loves using your platform and you have a good relationship with them, there’s a good chance they’ll be willing to spend half an hour on Zoom with you to explain their tech stack.
Ultimately, you should aim to build a recurring process for calls like this, since you won’t get the feedback you’ll need from traditional sales calls.
Paragon can supercharge your product-led growth
If you understand your ideal customer’s workflow deeply, you’ll be in a good position to create a product with integrations that add so much value that users will refer you without a second’s thought. And perhaps that’s the ultimate definition of product-led growth.
We appreciate that it’s hard enough to build your product, let alone worrying about developing all the integrations you need from scratch. So why not let Paragon take care of the heavy lifting on integrations? That way, your team can focus on building your unique product. Sign up for a Paragon demo today!
Conclusion
After reading this article, you should now be in a position to understand:
- What product-led growth is and why the market is trending in that direction
- Why integrations are an essential part of any product-led strategy
- Which integrations you should always build into your product, without fail
- And how to discover the specific integrations that your best customers will need
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