June 20, 2024

Making great products is not enough in software these days. The “build it, and they will come” mindset will no longer lead to success in this ever competitive space. As software products become more sophisticated and customers more discerning, the path to market acceptance has become much more complicated. Companies need different capabilities to navigate this more challenging environment, with sustainable success increasingly requiring a role devoted to understanding and priming the market—one known in the industry as a product marketing manager (PMM). Many large tech companies and well-funded start-ups have learned the hard way about the heightened importance of software product marketing, burning through too much cash as they struggle to build sufficient customer adoption on the fly.

In this new era, where more and more companies are embracing product-led sales, PMMs can take some of the risk and guesswork out of successfully bringing a new product to market. They provide essential orchestration and expertise at each stage of the commercialization journey, both before and after the product gets into the hands of customers. While some of the work done by PMMs has existed for at least a decade, shared largely by product management and marketing functions, the specific role and discipline have only recently been formalized and gained traction. As the criteria for software adoption have evolved and the window for success has narrowed considerably, a growing number of leading software companies, including IBM, Meta, Niantic, and Snowflake, are embracing this new model. Many more are actively considering it.

This shift in capabilities comes as software investors are changing how they measure success. From 2022 to 2023, 84 percent of publicly traded software companies saw their valuations drop, with more than a quarter experiencing a decline of more than 50 percent. Where a “growth at all costs” mindset used to be the primary focus for investors, margins and free cash flow are now among the top criteria.

In this new era, where more and more companies are embracing product-led sales, product marketing managers can take some of the risk and guesswork out of successfully bringing a new product to market.

McKinsey examined the relationship between robust product marketing functions and revenue growth among the top 100 software companies by revenue. The findings affirmed the pivotal role of PMMs in helping their companies’ products propel growth (Exhibit 1). Companies in the highest revenue growth quartile have a formalized PMM function and exhibit, on average, a 25 to 30 percent higher ratio of PMMs to product managers (PMs) compared with those in the bottom growth quartile, averaging approximately one PMM for every 1.6 PMs. These PMMs also come from diverse professional backgrounds, with an average of roughly 11 years of experience across disciplines.

Software companies with established product-marketing-manager functions have enjoyed higher revenue growth than their peers.

Despite the similarities in their abbreviations, the emerging PMM role in no way reduces the importance of the core PM job. But as that position’s responsibilities have expanded greatly and shipping software has become more complex, PMMs have started to play a key support role, acting as a strategic connector between the various functions involved in launching a new product. Based on our market experience, research, and interviews with a number of industry executives, we believe this role is poised to become a differentiator for the most successful software providers. This article examines the shifting market environment that has fueled the PMM’s growing importance, how the role can make a significant impact for companies, and what it takes for an organization to reap the benefits of the PMM capability from the outset.

(Not) keeping up with changing software go-to-market requirements

Until a few years ago, developing a new software product was a much greater challenge than building market acceptance for it. But that dynamic has reversed. The maturity of the product management function has transformed development, easing many past challenges. Meanwhile, everything about bringing a product to market has become vastly more difficult:

  • Timing matters more. Companies used to be able to focus on scaling adoption after a product had hit the market. Now, much of that legwork must be done in advance. As markets have become more competitive and shifting economic conditions have made efficient growth a greater priority, the runway to demonstrate commercial success has shrunk markedly. An enterprise product needs to be at scale within months, a consumer software product within weeks, and a gaming product often within days. Archit Bhargava, senior director of product marketing at Niantic (the company behind the augmented reality games Pokémon GO and Monster Hunter Now) echoes this sentiment. “We plan our efforts around a single key metric—daily active users,” Bhargava tells us. “We will introduce marketing initiatives multiple times per week, track impact by cohort, and take iterative action every week to drive results.” To get there, companies often need to have dozens (sometimes hundreds) of customers signed up at general availability after using the alpha and beta stages to capture critical market intelligence. As Denise Moreno, vice president of consumer marketing at Meta, explains, “Tracking leading indicators early is critical. If you see users not using the product as it is intended, you have to make a change.”
  • More decision makers needed in the buying process. Gone are the days of selling software to a few procurement leaders in IT. In addition to engaging with IT and procurement, enterprise sales must also make a compelling and more organic business case to line managers, legal teams, division heads, and very often the end user. These individuals may have incongruent needs, requiring different go-to-market (GTM) approaches. “As SaaS [software as a service] and platform models become dominant,” says Liz Urheim, former chief marketing officer for IBM Software, “the user plays an increasingly important role. They want to organically explore the product, which means marketing has to be in the funnel for longer.”
  • Greater technical proficiency required. In the past, companies could rely on traditional marketing teams to provide and lead standardized messaging across customer segments. Customers nowadays expect significantly greater customization than before—in their software products, sales motions, and the marketing outreach directed toward them. To be competitive, GTM teams need to demonstrate specialist knowledge and tailor the technical value proposition of increasingly complex products to specific audiences. This is hard to do across a broad portfolio and requires specific skills. As IBM’s Urheim explains, “A PM often has to take on a product marketing role, usually without training. As a result, messaging often focuses on describing a product’s capabilities and features. But that is not how you go to market. You can’t take a ‘product out’ approach; you go to market based on customer needs and use cases.”

Making PMMs a game changer for software

PMMs sit at the intersection of commercial organizations (Exhibit 2). These individuals come from a variety of backgrounds, including consulting, strategy, product management, marketing, and communications and have acquired deep technical and market knowledge of the software landscape.

The product marketing manager acts as a translator between the product development and go-to-market teams.

They use that understanding to articulate a product’s value and the characteristics, price points, and functionality likely to appeal to key segments and personas. As Goksu Nebol-Perlman, vice president of business product marketing for Meta, observes, “Product marketing is the glue that keeps the product, the market, and the customer together.”

PMMs help software companies meet the demands of today’s commercial environment in three main ways:

  • Partnering with product management to align the value proposition with market priorities. While PMs lead the development process, PMMs are powerful collaborators in designing the product strategy and road map. They spend time in the field—engaging with customers, participating in industry conferences, researching trends, and staying abreast of competitor movements. And they use the insights gained there to identify strategic partnerships, shape the product’s market positioning, and pinpoint which use cases to prioritize. As Meta’s Nebol-Perlman explains, “Product marketing managers lead both the early inbound phase, where you build the strategy and market understanding, and the outbound phase, where you are going to market.” At one global software company, the PMM actively participates in monthly planning meetings with product teams (product management, engineering, design, etcetera) to highlight major moves made by competitors. Product managers use this information to refine their road map, reprioritizing product features and offerings as needed to ensure releases get traction with customers.
  • Translating requirements to help product and marketing and sales teams excel. PMMs move fluidly between product and GTM teams, “speaking the language” of both—and easing a communications and logistics void that has grown wider as software products incorporate ever more advanced features. For product teams that are often intimately involved in technical development, PMMs can provide a helpful outside-in perspective, sharing market insights that allow developers to zero in on the most differentiating features. For marketing and sales, PMMs can act as educators and communication partners, bringing specific domain expertise that can help these teams adequately reflect a product’s unique selling points. At an enterprise data management company that sold highly specialized software, the PMM helped sales and marketing understand who the key buyer profiles were likely to be and how the product stood apart from the competition in meeting their different needs. Having the PMM as a resource removed the guesswork and legwork for the GTM teams, allowing them to understand customer needs and their own product much better.
  • Shepherding the launch process to ensure strong oversight and coordination. While market messaging is certainly part of their remit, PMMs are principally focused on what it takes to bring a product to market. PMMs own the overall launch plan and provide product and customer-specific expertise. They drive sales enablement and activation, partnering on lead-generation tactics as well as launch-related communications, campaigns, and brand awareness. They also define and track relevant product performance metrics such as customer satisfaction scores, lead conversion, cost per acquisition, and lifetime value. As Tim Fletcher, vice president of product marketing at Snowflake, puts it, “PMMs are responsible for the go-to-market success of their product, full stop. They own the overall plan, setting goals for adoption with sales, driving the cross-functional GTM working groups, and developing the big bets that are going to drive growth.”

Getting the most out of a PMM

The PMM role is relatively new. But our experience and interviews suggest that companies can begin capturing value quickly by prioritizing a few key practices:

  • Take a portfolio approach. Organizations won’t need a PMM for every product, but some offerings may need several. To understand the right mix, we recommend taking a portfolio approach and using a product’s technical complexity, market requirements, and maturity as a guide. For example, highly advanced technical solutions and early-stage products generally benefit from a PMM, since successful launches require deep outside-in expertise—allowing PMMs to demonstrate clear value as partners and stewards. To support the launch of a critical early-stage product, one company engaged one PM and two PMMs because they felt they needed that level of depth to analyze the market quickly and comprehensively. Some companies allocate PMMs at the vertical level, especially in sectors that have diverse subspecialties, such as financial services or healthcare, where customer needs and user journeys can vary widely. As Fletcher notes, “The biggest unlock for us at Snowflake was to verticalize sales, and then add vertical PMMs as counterparts who lead vertical working groups inside marketing. This took a lot of time and organizational effort to do, but we now have a much smoother operating model.”
  • Set clear expectations and responsibilities. No one wants to be tripping over other people’s toes or guessing what another person’s remit is. As one product marketing executive we spoke with observes, “One of the most common failure modes is when companies create shadow organizations without clearly thinking through what the operating model for product marketing, product management, and the go-to-market teams should be.” Leaders can avoid this by delineating what the new operating model should look like and codifying which tasks are owned by which functions throughout the product development life cycle (Exhibit 3). It’s important also to define clear measures and incentives, based on rigorous documentation and data, to help PMMs advance shared outcomes—and feel rewarded for doing so. Such metrics can range from the value that PMMs provide for businesses and individual customers to the number of market insights they uncover that are incorporated into a product launch.
Product marketing managers have an array of responsibilities in the product development life cycle, with ownership varying by task.
  • Standardize the launch model and the supporting asset portfolio. Best-in-class organizations tend to follow a standardized launch methodology (Exhibit 4). At the alpha and beta stages, PMMs may set up real-time user testing, feeding back results to the development team so that key refinements are incorporated early. And at prelaunch, they build assets and communication tools to support key internal stakeholders, channel customers, and early customers. At postlaunch, they oversee strategies to maintain customer loyalty, track and report on key product performance metrics, and identify risk factors that might lead to churn. PMMs also play a key role in helping sales and marketing standardize core assets—both the type, such as the pricing FAQ, pitch decks, and demos, as well as the level of customization. All too often, however, companies make the mistake of having PMMs in name only; these individuals end up maintaining standard, check-the-box templates that never get used because they don’t include the specific expertise and context that effective product marketing demands.
New product introduction at the most successful software organizations typically includes five key stages.
  • Build with the future in mind. As organizations gain familiarity with the PMM role, they can establish a formal skills matrix, hiring rubric, and learning journey to attract, develop, and retain talented individuals. For example, the growing sophistication of product instrumentation and generative AI (gen AI) will require product marketing managers to understand how to use these tools and employ data and analytics to shape the launch process and channel strategy. Niantic’s Bhargava explains, “Gen AI allows us to rapidly iterate on our messaging and collateral, enabling us to go further with every invested dollar.”

Gen AI is expected to have a similar impact on related functions such as product management. Teams leveraging the technology should be able to generate, validate, and test ten times as many ideas as previously, thereby compressing the overall product development life cycle and shortening the amount of time from discovery to launch. Several leading software providers (for example, Aha! and Atlassian) have incorporated gen AI functionality into their offerings to allow users (PMs, PMMs, and designers) to conduct and synthesize user research, summarize usage analytics, and analyze market trends. As gen AI tools and underlying models mature, and product teams become more sophisticated in leveraging the technology, we expect the PMM role will continue to evolve. Some early movers (for example, Airbnb) have already started to converge the PM and PMM roles, though we recognize this may not be suitable for all organizations.

An effective, mature product management function is no longer enough to thrive in software, where launching new products is becoming increasingly complicated and challenging. Organizations should strongly consider investing more in product marketing, especially by embracing the new, multifaceted role of the product marketing manager. We believe this strategic position, which brings a higher level of expertise to overseeing the launch of new products, is poised to become a source of competitive advantage. The enterprises that are early movers stand to gain an additional advantage—the opportunity to attract individuals with the experience and unique skill set to begin delivering impact in the market right away.


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