In a traditional top-down sales approach, the sales team is motivated to close the largest and newest deals to account for the high acquisition cost and ensure profitability.

In contrast, in a product-led sales approach, the sales team gets involved with the account much earlier in the problem lifecycle, and the initial contract value is smaller. It’s important to note that in top-down sales, the buyer is typically captured during the high maturity stage of the problem. In contrast, in product-led sales, the account is acquired earlier in the lifecycle. Therefore, the landed annual recurring revenue (land ARR) is not comparable between the two channels. Product-led sales’ primary goal is to expand by continuously growing with the account, which is where most of the revenue is generated. Overselling the account during the initial contract can be detrimental as it may disrupt the expansion journey.

There are a couple of other recent posts on product-led sales that I found useful:

• What is product-led sales? The future of selling software by Wes Bush.
• Your guide to product-led sales with Figma and Hex’s Jesus Requena (from Kyle Poyar’s newsletter).
• The PLGeek Guide to Product Qualified Accounts (PQAs) by Ben Williams.