What is Product-Led Growth?

Product-led growth (PLG) is a business approach in which customer acquisition, conversion, expansion, and retention are primarily driven by the product. The PLG approach focuses on building a product that the users depends on.

The primary distinction is in the methods used to attract and win over new clients.

Sales teams are essential to sales-led growth (SLG) because they actively seek out, qualify, and close business. It has lengthier sales cycles and direct outreach as common elements.

The user experience is given priority in product-led growth (PLG). Free trials, freemium subscriptions, and assisted onboarding assist customers in understanding the worth of the product, generating upgrades and conversions.

Here are the four main advantages of the PLG method: 

• Reduce CAC (Customer Acquisition Costs): The PLG approach keeps sales and advertising resources under control.
• Sales cycles: Selling the product is a time-limited process.
• Product updates: Product developers perform regular feature and maintenance updates to ensure users obtain the services they require.
• Viral growth potential: A PLG product can obtain positive feedback leading to popularity.

Here are five best practices you can use to develop a PLG growth strategy: 

1. Achieve a complete understanding of your target audience: Determine who your users are and what expect from your product.
2. Provide freemium product versions or free trials: Combine your software features to foster subscription plan upgrades.
3. Straightforward onboarding processes: Make it simple for customers to start using the product.
4. In-app assistance and support: Offer your users contextual instructions and guidance in a balanced manner. 
5. Analyze your data: Monitor usage behaviors and industry trends.  

PLG  is a popular growth strategy used by several SaaS businesses like: 

• Slack: A team communication app that offers a free version with a upgrade possibility.  
• Zoom: The video conferring tool that is used worldwide by businesses from different sectors.
• Mailchimp: A marketing automation platform offering multiple pricing plans.