Following up on my Guide to Building Milestones post from a few weeks ago, we held a Milestones event to walk through the ins-and-outs of PQL (product-qualified leads), EQLs (expansion-qualified leads), and the whole magic of milestones for product-led growth companies.

Joining us for the conversation was Jean Lethuillier, the Chief Customer Officer of Allma, a Slack-native incident management tool.

The Basics

To lay the groundwork I started with the basics: what are milestones and why do they matter?

Milestones are a way to track the activity of a contact or account. A milestone—like onboarded or product qualified lead (PQL)—will generally include some behavioral criteria such as users invited or actions taken, a threshold, and can also be windowed to a specific amount of time (in the last 30 days). Milestones are the best way to track the growth of your prospects and customers in a PLG world.

Why do milestones matter so much in a PLG world?

Milestones:PLG::Sales Stages:Enterprise SaaS. They give the organization visibility into the prospect and customer pipeline and help with prioritization and forecasting.

Get your SAT hat out

How are milestones different from sales stages?

  1. They’re based on the actual behavior of prospects and customers instead of more vague entrance/exit criteria and the gut feelings of salespeople.
  2. They extend throughout the entire lifecycle (instead of just stopping at closed won).
  3. They don’t handle state quite the same way (you can have completed more than one milestone, but you can’t sit in more than one sales stage).

Getting Started with Milestones

From there we jumped over to structure.

So you’ve bought into the idea: now how do you get started? While everyone’s milestone definitions will be different, like sales stages, I think we can get started with a general set.

Milestones should roughly match your journey, so here’s a generic one you can start filling in:

Signed Up > Onboarded > Product-Qualified Lead (PQL) > Transacted > Active/Steady State > Expansion Qualified Lead (EQL)

Jean also offered the journey she had built out for Allma. Here’s what they put together:

First Touch > Assessment > Steady State/Blocked

It’s worth listening to Jean describe the whole thing.

Jean makes a point that I want to reiterate: don’t boil the ocean! Like most other things with startups, it’s better to start more general and get more specific as you learn more. Don’t try to boil the ocean (you’ll see this a few more times), just try to get yourself to a good starting space to understand where a company is in its journey with you and your product.

Structure of a Milestone

Before we dive into what those different milestones mean, let’s quickly talk about the structure of a milestone.

Milestones are defined by the actions your prospects and customers take in your product. Actions are what we call an Event Types in Variance: something like Signed Up or Invited User.

That Action is then combined with: 

  • Property filters (optional): do you only want to count the Invited User action if the invited user was an admin versus a member? You would handle that with a property filter.
  • Threshold: how many times does this action need to be taken in order to be counted against the milestone?
  • Time Window (optional): do you only want to track whether this action happened a specific number of times within a certain time period? 
Simple structure, powerful resutls

Health vs Milestone

Another thing we discussed is the difference between a milestone and a health score/RYG. I thought Jean had a great articulation of the difference:

Customer health and customer milestones are partners in crime. It's not one or the other. How I see it is that customer health tells me that an action needs to be taken, it doesn't tell me what that action can be unless I look at which part of the journey the customer is on. Say, for example, if the customer has not reached their "Aha moment" in the assessment phase and their health is red, I am not going to go in there and say, "hey can you tell me about the past 10 months" and instead I'm going to go in there and I'm going to try to understand where they're getting stuck. Is there a particular page or setting that they're tinkering with for the last three days? Maybe it's an integration that they're trying to figure out. So that's how I see customer health and customer milestones: One tells me they're taking action, the other one is my call to action.

This is one of those places we see folks trying to boil the ocean and it’s best to treat them as separate. Milestones are letting you know the actions someone has taken and health is going to be more about how active they are in taking them. Like Jean says, one is the actions they’re taking (milestone) and the other is the call to action (health).

Onboarded vs Product-Qualified Lead (PQL)

There’s a lot of confusion around what goes into an onboarded milestone and what goes into a PQL. Shouldn’t someone onboarded be qualified? For some companies, it might make sense to combine them. The fundamental question you need to ask is whether the steps a customer must take to be onboarded are enough to count them as a qualified lead. 

For products that require integrations or some other reasonably complicated configuration/setup, I think it makes sense for these to be separate. Onboarded should capture the basic requirements of using the product. For Variance, for example, our Onboarding milestone would be:

  • [Connected Data Source] (at least 1 time)

That’s it. This is the bare minimum you need to use our product. That doesn’t mean you’ll be successful (that’s what the PQL is for), but it does mean that you at least have the opportunity to become successful. For some companies, this won’t matter much and can just be skipped, but companies who get stuck in Onboarded without reaching PQL may offer good opportunities to try to grease the skids a bit.

So now let’s talk PQL. For most PLG companies this is the most important milestone. It’s the line between someone just testing your product out and being a prospect. A PQL should be a set of actions that indicate the account is highly likely (>70%) to convert. Exactly what those actions are will naturally be dependent on your product.

  • If you make a messaging app, it’s almost definitely the number of messages sent (which theoretically also wraps up the number of users invited)
  • If you make a team-oriented project management app (Jira, Asana, Linear, etc.), it’s probably about the number of users invited + tasks created. (This will depend highly on whether there is single-player value in the app or not.)
Slack PQL, Asana PQL, Salesforce PQL

Wrapping Up

Here are my key takeaways from the event:

  1. ​​Milestones:PLG::Sales Stages:Enterprise Sales. 
  2. Don’t boil the ocean.
  3. [Action] + {Filters *optional*} + (Threshold) + <Time Window *optional*>
  4. Onboarded should capture the basic requirements of using the product.
  5. A PQL should be a set of actions that indicate the account is highly likely (>70%) to convert.
  6. Health and Milestones should be handled separately 

You can find the full video on the Variance YouTube channel (please subscribe) and if you want to get going managing milestones with Variance, please get in touch

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