Product-led growth (PLG) is a go-to-market (GTM) strategy where you focus on delivering value via your product with low barriers to entry. This usually involves a self-serve aspect in the product with a synchronized sales-assist motion (if applicable) that employs the consultative sales approach - commonly known as product-led sales.
On the other hand, functions like Marketing have evolved to be a growth engine in this motion by focusing on product focused content distributed via various channels. The goal here is to drive acquisition or product usage. Another key strategy here that Marketing may drive in collaboration with product is Community Led growth.
Traditional B2B sales motions that focused on lead gen and a sales led approach are still applicable in some use-cases or segments but are increasingly on the decline.
Now all of this is table stakes and we know it. Great PLG companies also focus on creating or re-inventing the flow. More on this later.
PLG in action
At it’s core, PLG is all about optimizing the customer journey from value promise to value delivery. This includes pricing and packaging your features in way that there is concrete value and a clear path from Free/Freemium to Paid to Enterprise (if applicable).
Value Promise
Your product’s value promise starts before your users visit your website. This can be done by use case and product-focused content. You clearly outline your product’s value proposition in context of your customer problems and drive them to your marketing website.
Marketing & community-led growth efforts focused on specific channels drive prospects to your website where you reinforce the value promise and offer pathways to convert to the product or talk to Sales. Success is measured by conversion rates to your self-serve product. Understanding the channels and content consumption habits of your users on your web properties and campaigns can also help you personalize the product experience once a user signs up.
You can start with experimenting with new & existing growth engines here like paid marketing, SEO, social, etc to drive user acquisition. Traditional marketing tactics like Demand Gen can also be evolved to drive users to the product apart from lead gen.
Value Delivery
This part of the customer journey post-signup is where you guide your users from the Setup to the Aha! moment — where they have experienced the value proposition of the product. Use case and customer segments are the two common dimensions that you can use to personalize your in-product experience. The easiest way to get this information is via on-boarding questionnaire, however you can also infer this data via third-party tools or use information from content & campaigns that are driving users to your product.
Focusing on use cases helps put things in the context of the problems your users face. However, the most important benefit of use case (or segment) based onboarding and activation is the selection and ordering of features that you enable your users to discover. Example: Features around security might be more relevant to your enterprise segment.
In this new era of PLG, the role of Sales/SDRs changes to a more consultative based selling model. Their success metrics also evolve from things like “meetings set” to aiding in getting users to success. Armed with use case based content and product usage data, this Product Led Sales motion can accelerate & improve Sales touch revenue along with enhancing the user experience. The two traps to look out for are treating your self-serve channel as a lead gen machine, and not introducing Sales touch in the self-serve process in the favor of user experience.
In our experience, the one key thing that enhances the PLG motion and can also help build competitive moats is the creation of flows via your product that enhances how your users solve their problems. So what is the flow?
The Flow
Your product is designed to solve a specific set of problems for your customer. In solving those problems, you build your product in a way that exemplifies a new or improved way of doing things. Not every product can create a new flow, however you can enhance the existing flow of doing things and integrate into other flows as well.
Companies like GitHub have built their own flow where they have taught the world around how to contribute to open source projects (PR flow) which is exemplified via the product. Salesforce brought in the whole Lead → Contact → Account → Opportunity flow. Figma invented the new design flow in the cloud around collaboration.
Creating these flows and developing a PLG strategy go hand in hand.