Product Marketing
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September 20, 2019

What Are Product Marketing Qualified Leads (PMQLs)?

By Aggelos Mouzakitis

How much value does your SaaS target audience get from a free trial of your software?

Typically, SaaS companies use Product Qualified Leads (PQLs) to measure how users engage with software during a free trial.

However, it isn’t always possible to use PQLs to measure how users engage with the software during a free trial, because PQLs do not account for a SaaS company’s complex GTM marketing strategy. So, it’s time for software companies to start categorizing their leads differently…

In this article, we are going to explore the new hybrid concept of Product Marketing Qualified Leads (PMQLs) and how SaaS companies can make this a core component of their go-to-market strategy.

Unlike other types of qualified leads, the new concept of Product Marketing Qualified Leads accounts for the many nuances of a SaaS marketing strategy.

Part 1: What are Product Qualified Leads (PQLs)?

Product Qualified Leads (PQLs) are potential users who have used a product and taken actions that indicate a strong likelihood that they have understood the core value it is offering.

For example, if a potential user has signed up for a free trial of your software and performed some key actions, this would be considered as a PQL. Signing up for a free trial and performing these key actions acts as evidence that our tool managed to activate this user and this user now understands the value of our software, which is the first step towards conversion, at the end of the trial.

In order to identify Product Qualified Leads, SaaS companies should look for two user traits:

  1. Activation: Have users set up their accounts? Have they reached the first meaningful outcome by performing the key actions?
  2. Engagement: Is the user engaged with your software the way you expect? Are they using the core features of the software?

These two user traits are quite vague and this why it isn’t always possible to use PQLs in your GTM strategy. Only 44% of software companies clearly define the actions that indicate “activation” and “engagement” for their software.

It’s hard to give a blanket definition of “activation” and “engagement” for every SaaS product on the market because every business model is different with varying value propositions.

For instance, with enterprise software, it can be days and even weeks until a user can be considered a Product Qualified Lead in a marketing strategy.

Part 2: What are Product Lead Magnets (PLMs)?

In a previous article, we introduced a new way of acquiring users for your SaaS company. Software companies can acquire new users through Product Lead Magnets (PLMs).

Product Lead Magnets are an incentive that SaaS companies can offer, as part of their sales strategy, to potential users in exchange for their email address. Lead magnets are usually a piece of digital, downloadable content, such as a free PDF checklist, report, eBook or whitepaper.

Product Lead Magnets can be used by sales teams in product launch marketing plans for customer acquisition 

The question that arises here is: how can you measure the effectiveness of your software free trial when you also offer a free piece of downloadable content to potential users?

The answer is not so simple, as Product Qualified Leads do not measure any other aspects of your marketing plan or sales strategy.

Part 3: New kind in the block: Product Marketing Qualified Leads (PMQLs)

So, we came up with a new category of qualified leads called Product Marketing Qualified Leads (PMQLs). Here is the definition of a PMQL:

Product Marketing Qualified Lead (PMQL) is a lead that combines Product Qualified Leads and Marketing Qualified Leads into one single measurement.

Take a look at the MozBar to see an example of a PMQL…

Image Source: Chrome Web Store

Let’s assume that a user has signed up to start using the MozBar for free. 

The order of actions taken by the user could be the following:

  1. Discovers the MozBar online
  2. Signs up for a freemium account (at no cost)
  3. Starts using the MozBar

It’s easy to start getting high levels of value from this new product. All you need to do is install the extension on your browser and away you go!

Even though the user hasn’t become a paying customer, the value proposition and customer experience provided by the freemium account could be enough to convince the user to sign up for a premium plan and continue on the buyer’s journey.

This makes the user a Marketing Qualified Lead and a Product Qualified Lead.

They’re an MQL because they’ve shared personal information with Moz through an online interaction (signed up for a freemium account).

They’re also a PQL because they have been using the MozBar, the free SaaS and have been getting consistent value out of it.

Simply put, this user fits into both lead categories!

This user is playing at the intersection of MQLs and PQLs, meaning that they qualify as both. However, despite this, there’s no guarantee that this user will become a paying customer for the company.

According to the extended product-led growth theory, this user is a Product Marketing Qualified Lead (PMQL).

Chapter 4: Why are Product Marketing Qualified Leads (PMQLs) effective?

We’ve seen that oftentimes, a user may not be easily identified as a MQL or PQL based on the nature of the product and the complexity of the SaaS sales process.

Let’s break down each of the terms to understand the differences between them. To begin with, let’s see how HubSpot defines Marketing Qualified Leads (MQLs).

A marketing qualified lead (MQL) is a lead deemed more likely to become a customer compared to other leads. This is based on the web pages a person has visited and what they’ve downloaded.

For example, if a potential customer from a new market has downloaded a free eBook created by your SaaS company, the potential customer becomes a MQL. This will usually be part of a SaaS company’s wider marketing strategy.

MQLs are related to marketing. Whilst PQLs are related to the product (or software) itself. It’s as simple as that!

PQLs were first talked about back in January 2013 by venture capitalist Tomasz Tunguz, who defines PQLs as:

Potential customers who have used a product and reached pre-defined triggers that signify a strong likelihood to become a paying customer.

In other words, the PQL approach uses the insights available in your software to indicate the likelihood of a user becoming a paying customer.

For example, if a potential customer has signed up for a free trial of your software, the potential customer becomes a PQL.

Product Marketing Qualified Leads are a hybrid of both PQLs and MQLs. They can be used by SaaS companies who offer both a free trial and marketing materials.

The question is: How can a software company optimize for PMQLs and make them a core part of their go-to-market strategy?

Chapter 5: How to Optimize for PMQLs

The users of a Product Lead Magnet (PLM) can also be classified as Product Marketing Qualified Leads (PMQLs).

If a software company wants to optimize for PMQLs in their GTM marketing strategy and build a mechanism that measures PMQLs, they need to build a product lead magnet first. If you’ve forgotten what a PLM is, here’s the definition:

Product Lead Magnets are part of a go-to-market strategy for many SaaS companies to reach their target markets. They offer these to target customers in exchange for their email address. Lead magnets are usually a piece of digital, downloadable content, such as a free PDF checklist, report, eBook or whitepaper. A lead magnet is intended to a strong high value proposition, promoting customer acquisition and giving SaaS businesses a competitive advantage.

The PLM that a SaaS company will build has to be relevant to the company’s core products, providing a strong value proposition for target markets. Simply put, the target audience has to experience value and be able to use the product right away. An example of a PLM is Clearbit’s Logo API tool:



The Logo API by Clearbit is a PLM that allows users to lookup company logos and embed them on their website. It’s a free tool that is designed to attract users and create awareness around the paid tools that Clearbit also offers.

To optimize for PMQLs, you have to create a PLM (Product Lead Magnet) that truly stands out and provides users with plenty of value. Keep in mind that your PLM will typically live outside of your main software. In other words, your product lead magnet will be separate from your main software offering.

The purpose of building and sustaining a product lead magnet is to get more users to try your main software through a freemium or free trial. You can think of it as being a gateway to your main software offering.

There’s a difference between a regular lead magnet and a PLM. Users will be able to get value out of the PLM consistently. For example, if the PLM is an eBook on a SaaS-related topic, the contents of the book will be evergreen.

To optimize for PMQLs, you need to create a high-quality PLM. The way to measure PMQLs is by taking into account actions that indicate engagement. For the Clearbit Logo API that we just mentioned, an example of this could be the number of logos added by a single user. 

Chapter 4: Conclusion

According to the 2017 SaaS-powered workplace report by BetterCloud, 38% of companies say that they run solely on SaaS, while companies use 34 SaaS on average to run their operations. This shows us that gradually, companies will need more SaaS tools to boost efficiency and outperform the competition.

It seems that we’ve reached fatigue when it comes to lead generation tactics to generate MQLs (Marketing Qualified Leads). Now, we need to find other ways to help users experience the value of our products and develop a meaningful relationship with them.

Aggelos Mouzakitis

Aggelos is the founder and Growth Product Manager of Growth Sandwich. He is among the first Customer-led experts in the world, leveraging advanced, Jobs-to-be-done customer research to orchestrate and guide Growth for B2B SaaS companies. A- and B- series SaaS are hiring him to organise, design and execute programs that infuse the whole company with qualitative data, empathy and the necessary knowledge to address any growth dilemma. In the last 4 years, he has worked with more than 100 SaaS companies and trained literally, thousands through my physical and online courses.