It might feel great to have tons of leads coming in to your SaaS product, but if they end up not converting or showing interest, it’s a sign your team is losing time and money. 

How does your team qualify leads and choose who to focus on?

In this post, we’re going to explain the difference between a MQL, Marketing Qualified Lead, SLQ, Sales Qualified Lead, and a PQL, Product Qualified Lead and their importance.


To better understand the importance of PQLs, let’s also take a look at SLQs and MLQs:

What are MQLs?

A Marketing Qualified Lead is one that has an idea about what your product could do to help them but hasn’t experienced it yet and has yet to try your product and make a decision. An MQL is someone who has engaged in a positive way with your brand’s marketing efforts but is likely not yet ready for personal contact. They are not likely fully disinterested but they are not highly likely to be committing to a purchase soon. This is typical for general marketing efforts: social media, emails, etc. 

How do you find MLQs?

MQLs can be leads that have engaged positively with your marketing efforts like: 

  • Engaged with your brand on social media
  • Opened and clicked on a marketing email
  • Clicked on paid advertisements, etc. 
  • Given their email on your site on a pop up after reading a blog

Marketing Qualified Lead

They are not overly taking action to go and sign up for your product and likely need more work to move them along the sales funnel. They are likely a good fit for retargeting efforts. What’s good is that these leads can be dealt with automatically through marketing and retargeting tools but they are not highly likely to convert. 

What are SQLs?

In addition to this, we have SQLs, or Sales Qualified Leads, which are leads that come in through the work of your sales team. They are a little more “positive” than MQLs in the sense that they have overtly told your team or taken an action that shows they are ready for a more in depth conversation, a demo, or use of your product. 

Examples of this:

  • They’ve emailed your team
  • They’ve agreed to a demo 
  • They’ve filled out a contact form 

Sales Qualified Lead

These are leads that really your sales team has to work with to get them to take additional steps towards converting. 

This is more relevant to larger accounts that take a longer time to close and require interest and confirmation from multiple parties just to get to a point of using your product. Depending on the type of SaaS you have, this may also be a part of your sales process. Learn more about demos vs free trials to discover what works best for your SaaS.

However, still, wouldn’t it be nice to have leads that are driven by your product’s functionality and not your team’s work? That’s where Product Qualified Leads come in. 

What is a Product Qualified Lead?

A Product Qualified Lead is a lead that has actually used your product in a free trial or a freemium model and has seen the value that your product brings to them. They have likely come through on a “self serve” basis and signed up for your freemium model and free trial. Your product has “sold” itself, in a sense, to qualify them as a lead that is likely to convert to a paying customer. However, just because they signed up for an account or free trial doesn’t mean they will be PQLs. If they navigate through different features of your product, ask questions, and are frequent users, they will be more likely to be paying customers. 

Product qualified leads don’t require your team to tell them how great your product is, they discover the value of your product themselves by using it. They are much more likely to become long term paying customers and should be the focus of your team to ensure growth. Focusing on PQLs is a product-led approach to growth. 

What makes PQLs so important for your long term success?

PQLs are the basis for more happy customers, less time and money spent, and more recurring revenue. Choosing to focus on PQLs instead of MQLs and SQLs is a key part of a product-led growth strategy. 

A product-led growth strategy focuses on:

  • Using your product to drive sales. 
  • Listening to customers and improving your product to keep recurring customers.
  • Ensuring customer success to generate organic traffic and leads

Shifting to letting your product lead the way in both customer conversion and retention ensures long term success.

Here’s how your SaaS product can grow with Product Qualified Leads.

Better understand your buyer persona.

Sometimes you can go into creating and launching your SaaS product with an idea in mind of your buyer. Once you get started and see who engages with and buys into your product, that can complete change. Leading with a product-led strategy and focusing on PQLs helps you to better understand who your product actually helps. Your PQLs may be a completely different buyer persona than originally thought. This can help steer your team’s decision making on larger questions like product development and messaging for marketing and sales. Learn more about identifying SaaS personas.

Focus on who is most likely to convert.

Your PQLs have already experienced your product’s value. They have likely been through a free trial or are a free user on a freemium model. A large base of trial users is great, but it’s their engagement that counts. The more users who are actively using your product everyday, the more likely they are to easily transition to paying users. Your team will want to focus on increasing engagement of trial users to generate higher quality PQLs. By focusing on converting them, you avoid having to spend the time and money taking users from vaguely interested to a paying customer. 

How to identify PQLs:

  • Web sessions
  • Feature usage 

Upsell and cross-sell satisfied customers.

A famous SaaS stat from Gartner tells us 80% of your revenue will come from 20% of your customers. If you use a freemium model, this is especially true. Focusing on PQLs allows you to take these customers who are happy using your product and turn them into paying customers. 

You can upsell and cross-sell them either to:

  • keep using your product 
  • access additional features or a higher level of service
  • Offer them complementary products

When you have a consistent base of PQLs, it’s easy to create this funnel and consistently grow your revenue from upselling and cross-selling customers and generating additional revenue without spending time and money on marketing and sales. 

SaaS product qualified lead upsell

Better understand your best features and sell more through feature development.

When you have PQLs, you have a wealth of information you’re getting from these users and potential customers. You can use their interactions with your product to better understand what your most valuable features are. You can get feedback from them on what about your product needs to be improved in order to make it worth paying for. With this information, you can better upsell your product and determine what new features to make in order to keep users on, paying, and attract new users. 

With a base of Product Qualified Leads, when you update your product with new features and improvements, you not only make it more likely to convert them but also add additional value for paying customers. Product-led growth like this brings in new paying customers while engaging current users more – the ideal model for revenue growth. 

Beamer is a great way to share new product updates with your users across your trial accounts, free accounts, and paid accounts as well as on your website for leads to see. Beamer is a changelog that sits within your product or website that users can interact with. It opens by clicking “What’s New” in your nav or an icon in your product’s interface. 

You can share updates on Beamer for:

  • New features 
  • Updates 
  • Bug fixes 
  • Company news

You can add photos, videos, and GIFs to your updates to better engage users and explain new features.  You can add CTAs to get users engaging with new features. You can also use push notifications to bring users back to your product, paying or free, when you have an exciting update. 

SaaS new feature

You can use Beamer to entice freemium users to become paying users to start using new premium features. Use segmentation to show users at different stages of your sales cycle updates that make sense. Beamer is a great way to put a product-led growth strategy to use on your PQLs and paying users. 

Shifting focus from spending money and time trying to convert a small number of your traffic to focusing on driving conversions and organic growth through product-led strategy is a modern, sustainable way of growing your SaaS revenue. Focusing on generating and converting PQLs is an efficient way to grow recurring revenue. For a better way to communicate with your SaaS leads and drive engagement, try Beamer today.