Product Led Growth: A Case Study For Aspiring Product Managers

In the analog world, if a business wanted to sell its goods and services in a marketplace, it would first have to identify the consumer’s needs. Then, manufacture the product, test that it is working as expected, and test the waters to determine what consumers would pay for it. Followed by staffing marketing teams to spread the word to potential consumers and attract them through incentives so that they’d try out the good or service and eventually make the sale. It didn’t end with making the sale; setting up a post-sales service experience was equally important to keep a consumer. As the digital world penetrated lives over the past couple of decades, so have goods and services through this medium. But what about product led growth?

In the analog and digital world, consumer purchasing is similar. They are humans making a choice. Hence they expect the same from any business selling them software as well. Given the explosion of software products over the past decade, the way software businesses have been built has changed, and a big factor in growing businesses has been the use of product led growth.

On a high level, it is simply using the internet as a distribution platform to acquire, activate, retain, and monetize customers who use your software. This change means there is little to no human touch in the process. In this, we will discuss how product led growth works in a scenario of an e-commerce tool. It broadly applies to all software products sold through the internet. 

Product Led Growth Model

Product Led Growth is the term used for products and services where little to no humans are involved in a user’s product use. Today a lot of why product led growth is possible is mainly because of automation. Yet there are a handful of companies in the software or SaaS world that have utilized and built automation to support this motion. Before going into the benefits of product led growth and why it is required, I want to call out a few aspects of why automation can be helpful to companies and then tie them to product led growth. 

Automation’s Main Advantages:

• The business focuses on other critical areas, reducing time sinks in areas easily operated with technology. 
• Reduction of human error in the process 
• Easy to enable scale 

With the advent of automation, the processing of selling software directly to the user has become simpler. If you look at the loop of decision-making by a user for software, it often looks something like this:

Discovery → Acquisition → Activation → Retention → Monetization → Referral

Each of these steps, aided by automation, creates a simple user experience in a non-human touch world, to understand how automation would play a role, the case we’ll be talking about is a new product offered by Bolt Checkout to a new market segment, in this product led growth principles are seen in motion. We will go along the case and, at the end through the case, summarize some key principles of product led growth. 

Let’s Dive Into The Case Study

Bolt is a Checkout Operating System for merchants selling online. It sits on top of a merchant’s e-commerce solution on the checkout page to add its payments orchestration, one-click checkout technology, and fraud management capabilities. 

Bolt also manages the Consumer identity of the shopper making the purchase, alternative payment methods, Buy Now Pay Later, Apple Pay, and Google Pay through a single integration. 

An example below: 

This offering helped merchants with e-commerce GMV(Gross Merchandise Volume) of > USD 3M annually. 

But the solution doesn’t fit the other segments of online merchants because:

• It is technically Complex to integrate & Requires developer resources 
• Economics: Inelastic pricing for SMBs, low margin businesses cannot be offered to spend more basis points 
• Sophistication: SMBs didn’t require such a sophisticated payment workflow but could use the advantages of the technology in bits and pieces. 

Due to this factor, Bolt couldn’t make roads to this sector and gain market share in the SMB space.   

This case tackles the unique case of <$3M GMV merchants defined as Small and Medium Businesses (defined in the Bolt context), coming up with a unique value proposition, product development, go-to-market, and pricing aspects.

Goals and Tenets

In 2021, Bolt’s main goal would be to enter the SMB market and acquire 10,000 SMB merchants selling online to use Bolt’s Checkout product. 

There would be three main tenets we would need to follow to achieve this:

• Simplicity – Bolt’s Checkout offering should be simple to integrate for merchants, and the offering should also be simple for consumers to pay for their products. 

• Increase Time to Value of Checkout for SMBs – Bolt Checkout takes an average of XX+ days to integrate. Moreover, the time to value of the checkout comes only when conversion rates increase meaningfully, which happens 15 days (average) after launch. 

• Partnerships to scale – Bolt can’t win as an enablement tool alone. We would need to partner with companies distributing to SMB’s to achieve the goal of acquiring 10,000 SMBs 

Product Definition for SMBs

For this first iteration, we focused on the US SMB market. 

During market research, we understood a few things from a few personas, namely: 

1. E-commerce platforms – They wanted to invest in the checkout but did not see a strategic rationale as they wanted to control the platform experience (UI/UX). However, they wanted a competing solution to Shopify’s Shop Pay without significant investment in payments. 
2. Merchants – Started to hear from their community about a reduction in cart abandonment and increased conversion through Shop Pay. Wanted an easy-to-use solution without any overhead of managing multiple providers and integrations. SMBs didn’t want multiple payment methods to control their payment flow and post-purchase experience. 
3. Consumers – A buy button tends to build trust in a high friction flow, and the brand recognition of the button helps consumers use the button to purchase goods without a second thought. Additionally, a network that helped consumers with their post-purchase experience was something they longed for. 

Execution

Bolt currently solves the post-purchase experience for all consumers. However, it doesn’t fit with E-commerce platforms or SMBs to embed checkout natively on their experience, which is crucial for the SMB market as platforms control the distribution. For platforms to compete with Shopify, a solution to solve checkout was a must. 

Hence taking this hypothesis, I set out to build Bolt natively embedded to the e-commerce platform’s checkout where there was no code self-service integration to go live in stores within minutes. 

To proceed, we had a trusted partner in BigCommerce who was always receptive to new ideas and a leader in the SMB e-commerce market, and we can build a product for SMBs together. 

Product Description: Embedded Bolt Checkout for BigCommerce 

1. Checkout with easy configuration – Turn on Bolt in the Payment Settings page of your BigCommerce control panel, connect your payment processor, and you’re ready to go
2. Keep the existing checkout – Embedded Checkout allows merchants to keep the guest checkout flow. Skipping the headache of remembering passwords and filling out long forms
3. Card Payments only – Given the simplicity principle, we learned that SMBs in the US were more used to this than other payment methods
4. No GMV Restrictions – Any merchant, new or old, can sign up for Embedded Checkout
5. Merchants get benefits of Bolt Shopper Network and Post Purchase experience just like Shop Pay

Merchant Experience

Enable Embedded Checkout by Bolt with a button on the BigCommerce settings Page 

Shopper Experience

If a customer has completed checkout with Bolt previously, they will see a pop to complete checkout with Bolt (Currently, Bolt has 23M + growing shoppers, 60% of them being from BigCommerce’s network alone)

If a new shopper wanted to check out, they’d have the opportunity to create a Bolt shopper account in the guest checkout flow. 

Execution Plan

• Collaborate with Business Development to make the pitch for a native Bolt Checkout solution for BigCommerce, a small and mid-market merchant commerce platform. 
• Review of the solution with Bolt Product and Engineering Team, refinding the requirements of asks to BigCommerce to make this successful. 
• Project Plan brief for Bolt <> BigCommerce (including staffing, testing, and go-to-market and revenue projections for sharing across the companies and project planning)
• Review with Bolt Marketing and CX (Customer Success and Customer Support teams) 
• Review with Bolt Leadership before setting a meeting with BigCommerce Partnership Teams 
• Pitch to BigCommerce Partnership & Leadership team 
• Follow up with BigCommerce Product & Engineering on the solution. 

Once we got the buy-in and roadmap commitment from BigCommerce, this helped Bolt to be a top strategic partner to BigCommerce for the year. 

What Next?

I built a relationship with the BigCommerce product and leadership team to build shared project milestones, weekly demos of the progress, and define beta and GA criteria. This involved doing stand-ups with engineering and product teams, shared communication channels (emails + slack), and bi-weekly GTM meetings with the BigCommerce BD and Marketing team. At Bolt, we staffed a BD member, Product Marketing + Partner Marketing member to take on the go-to-market efforts and plan for each milestone post-launch to hit the target of 10,000 SMBs. 

An important element of co-building with BigCommerce was removing bottlenecks when necessary to avoid delays. Hence, I took up a leadership role at Bolt with constant communication with the leadership team about the happenings by doing weekly reviews with the CEO. I kept ensuring that both partner teams were celebrating wins together, doing retrospectives when needed to make progress in this initiative.  

As part of the shared product initiative, pricing was a factor where BigCommerce and Bolt worked together to determine an easy way to bill the merchants as part of their BigCommerce payment plans. Pricing was determined like a SaaS product – a free trial for 90 days to show the value of the conversions at checkout and a tier-based monthly price billed to merchant’s  BigCommerce account based on their GMV. 

Goals Hit

1. X000 SMB Merchants acquired in the first-month post open GA. 
2. Time to onboard merchants reduced from an average of XX days for other Bolt products to 2 mins for Embedded Checkout. 
3. XX% conversion to paid users post-free trial. 

Some Additional Notes

• On the go-to-market side, Bolt and BigCommerce are doing joint trade shows and paid social ads to acquire more merchants. 
• This product was rolled out for SMBs on BigCommerce only based on annual GMVs. Enterprise merchants on BigCommerce had to go through the sales cycle of Bolt. 
• This partnership enabled multiple other $XXX Million dollar partnerships for Bolt, including Adobe Commerce, Magento Commerce, SAP Commerce, Salesforce Commerce Cloud 

Principles of Product Led Growth

Nail your Ideal Customer Profile

Product Led Growth doesn’t work for every product/service. You need to narrow focus on the problem set of a core user base and then iterate. Hence, focusing on nailing the ICP is often the first step to be taken. 

Product Led Growth requires a different mindset and an organization-wide effort to make it successful. Even for my work to be successful, we had dedicated separate teams in each division to achieve clarity for the employees to execute this.

Utilize automation for key user journeys such as onboarding, win-backs, and internal tooling where the teams function together. 

Incentives Matter

Since you speak to your users directly through different channels, you must incentivize them to try the product. In today’s world, trying the product is a critical step in making the purchase decision and is even more important in the product led world. 

Keep Communication Lines Open

Good or Bad experiences for your users; having different channels for them to work with you is very important. This solves their problem and is critical to building trust outside of core product experiences for the user. 

Invest in Education & Training

Your organization would need to learn everything about a new internal and external area. And a new set of users and how they behave. Similarly, the users would need to learn about a new product they’d never been accustomed to. So, getting everyone together at the apt time is important. 

Keep it Simple

Finally, this is what everything comes down to for employees and customers. If something in a non-human touch world isn’t simple to use, learn or understand, then all else fails. You’ve got to start with keeping it simple and not make “simplicity” iterative. Even if there are subpar product experiences, such as bugs, prioritize simplicity. 

Utilize one lever for other initiatives. What you see was tested and built for one platform and easily scaled to other platforms and use cases. You can see how we leveraged it above to gain multiple partnerships using one. And product led growth allows for this and ultimately helps the business.  

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