As investors pivot from a growth-at-all-costs mindset to a renewed focus on profitability, the idea of product-led growth (aka self-serve buying) and the promise of lower customer acquisition costs continues to gain in popularity.

However, many product-led-growth sales funnels have a core problem; buyers entering the funnel don’t understand how to use the product to address their needs. They get frustrated, give up and the company ends up with a poor conversion rate.

The 3 keys to solving this problem and improving conversion in a self-serve funnel are:

1. Define your first impact milestone

2. Focus your onboarding sequence on your first impact milestone

3. Onboard your customers manually

1. Define your first impact milestone

Most self-serve customers fit into the end-user profile—they want to use the product day-to-day to perform an existing task more efficiently (the often called “job to be done”). The sooner they see that the product enables them to perform the task, the less likely they are to give up and the more likely they are to convert.

Your first impact milestone is that magical moment when your customers realize that your product does what they need it to do. Every product has its own first impact milestone. Here are some examples of first impact milestones in B2B and B2C products:

• Calendly: booking your first meeting.

• Hootsuite: scheduling your first social media post.

• LinkedIn Ads: getting your first lead from an ad campaign.

• Facebook: interacting with someone you know.

If you don’t create a clear first impact milestone for your product, buyers are more likely to churn because you are likely either a) overwhelming the buyer with choices (by presenting too many features) or b) making them jump through too many hoops to get the impact (by making them fill out forms, download apps etc). It’s therefore critical to define your first impact milestone and to ensure that your marketing, customer success and product leaders agree on it.

2.Focus your onboarding sequence on your first impact milestone

It’s common practice to have a sequence of nudges (i.e. emails, app alerts) that kick off once you enter a self-serve funnel. E.g. “Welcome to Acme, Inc”, “Getting Started”, “Helpful Resources”, delivered over a number of days.

However, the most common mistake teams make is to focus onboarding nudges on the outcome the team wants (converting to a paid customer) instead of the outcome the customer wants (performing the task they had in mind).

This leads to generic onboarding sequences that start out with how-to-guides and video tutorials that overwhelm the buyer with choice, drift over time into upselling the benefits of additional features and end up in a weekly email newsletter. As a result, the buyer never reaches the first impact milestone. They just get frustrated and give up. I’ve been through 3 funnels like this in the last month.

Instead, the best practice is to focus your onboarding sequence on reaching the first impact milestone, by understanding where the user is stuck and prompting them to take the next step. One of the best onboarding sequences I’ve seen was Facebook from ten years ago. They had clearly realized that adding some critical number of friends was the key to reaching the first impact milestone of interacting with someone you know, so they made their entire onboarding sequence about adding friends. Add friends! Don’t know how to add friends? Import your friends from your email! Import your friends from your phone! Add more friends! They never talked about any other feature until I had added enough friends. We can apply a similar approach to any B2B self-serve funnel.

3. Onboard your customers manually

A very effective way to improving self-serve conversion is to onboard customers manually. While this sounds counter-intuitive at first, it actually works incredibly well because it filters out tire-kickers and you get to hear your customers describe the problem they are trying to solve, show them how to solve their problem and set them up for long term success.

There are two ways to do manual onboarding:

1. Onboard everyone manually—the process here is that every new customer has an onboarding call before they start using the product. We did this at Polyvore for our self-serve ads business because we realized that no matter what in-product hints and tips we provided, our customers would always compare us to Google Product Ads and assume they needed a slew of additional features that in order to hit their goals of driving leads. It worked really well; we were able to help customers set up their accounts to drive stellar ROI and built a $30M/year business with 1% annual logo churn. I’ve seen SaaS companies take a similar approach in recent years; Front onboarded its first few hundred customers manually and set them up for long term success.

2. Onboard on demand—the process here is that every new prospect is offered the option of an onboarding call with a product advocate. We did this at Quora for our self-serve ads business because we couldn’t avoid customers comparing us to Facebook ads, where results happen quickly, whereas on our platform you had to be more patient and wait for the first impact milestone of driving leads. We implemented the onboarding option by creating a sequence of automated emails to new customers from our product advocates, offering the opportunity to speak with an expert to get up and running faster and providing a link to book a call. It was very effective; we found that customers who booked an onboarding call with one of our team ended up spending more money and churned at a much lower rate than those who didn’t.

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