There are many different business strategies you can adopt if you want to grow your business. One method that has proved to be very successful in recent years is Product Led Growth. You may already know some of the companies that have benefited from such a business strategy. Some of the most well-known companies currently in the market place use this method for business growth.
When a company adopts a PLG strategy, it can grow much faster and more efficiently because it has leveraged its products and created a pipeline of users that they can then convert into those all-important paying customers.
What is Product Led Growth?
Product Led Growth (PLG) methodology is a go-to-market strategy that primarily relies on product usage to drive customer acquisition, conversion and and the expansion of the business.
Virality is at the heart of this strategy because every time someone uses the product, they’re also promoting it for you!
This can be by means of sharing, collaboration ask yourself where or how will customers find out about the product?
What does it mean to be product led?
Its really simple your product is at the center of your business. The product is your core customer acquisition tool.
Instead of taking the traditional marketing and sales route which can cost large amounts of money. Instead, you rely on the product selling itself and supply a pipeline of satisfied users who convert to full paying customers.
A product that doesn’t add value to a business isn’t going to attain rapid growth
Product Led Growth Strategy
Essential features of a Product Led Growth Strategy includes:
Growth without dependency: PLG allows your business to grow without investing vast amounts of money on paid advertising or a sales team that’s always chasing leads.
Customer-centric: The primary aim of PLG is to create happy customers as they become loyal fans and help to promote your business.
Independent adoption of the product: This methodology allows your customers to self-serve and go on to adopt independently.
A pricing model that’s freemium-based: Often, PLG is fuelled by a pricing model that’s freemium-based or “try before you buy”. Customers don’t have to commit to an annual or monthly fee if they want to get started.
Benefits of Product-Led Growth Strategy
There are several benefits to adopting a PLG strategy, but the most significant one of all is that it leads to faster and more efficient growth, which is something that’s apparent at every stage of the customer’s journey.
An Essential Element of PLG is low acquisition costs: Several different big-name brands have adopted PLG. You may already be using products or services from brands using a product lead growth strategy, but think about how you found out about them.
Chances are, it wasn’t a whitepaper or an ad that attracted your attention. Before you started using them, you may have never heard of them before.
Increased upsells and retention: In a product-led growth strategy, the emphasis is on how customers interact with different products. User engagement data is readily available, allowing customer success teams to determine who’s engaging and who’s not. With this information, they can tailor upselling and retention campaigns.
Better user experience: It improves the customer experience because they’re given the opportunity to realise a product’s value before paying for it. Users are given the option to pay for the product or service once they realise its value.
Product Lead Growth Example
PLG is something that relies on the concept that when a product is a good one, it’ll enter the market and grow all on its own. This is a principle embarrassed by tech companies especially in the SaaS (software as a service).
You may have heard of some of these well known companies who have been founded on Product Lead Growth principles:
- Slack: Communications Software
- Dropbox: Cloud storage
- Calendly: Meeting Scheduling Software
- SurveyMonkey: Survey tool to capture opinions
- Zoom: Video Communications
- Zapier: Integration Web Applications
- Hubspot: Inbound Marketing Software
- Netflix: Streaming Service
You have probably become aware of these companies because you know someone who already used it. They may have sent you an invite or a file that you had to open. Once you opened that file, you became another user. More often than not, it would have cost you nothing to use it.
It didn’t require a marketing team to buy up some ad space. A sales team is not a requirement either. What is most important is a product that sells itself because it’s really, really good.
Product-Led Growth Key Components
Here at Checkify we are focused on product led growth and building a great product and here are some key components that you need to think about:
Keep it Frictionless: Friction inhibits usage and adoption within a business. What should you think about to make using your product easier:
- Sign Up: Simple and Quick sign-up process dont put up walls that are off putting to sign up like credit card details before a free trial.
- Baby Steps: Dont push people to do too much, too quickly. Let them slowly get use to using the basics before encouraging using more advanced features.
- Product Onboarding: Smooth training to get new users up-to-speed quickly
- UX / UI: User friendly avoid over complicated and unnecessary features. Less is more. Make sure you understand the features needed and create a solution that fits that need but also intuitive to use.
- Collaboration: Business and process collaboration is essential for people to work as a team effectively. Make it easy to collaborate.
Add Value: Prove value ASAP. You must show how you can add value to the business and failing to demonstrate this essential.
Positive initial experience is crucial
Feedback: Continuously ask for feedback and how you can make the product better
Word-of-Mouth: Positive experience and adding value to a business naturally leads to sharing that experience with others. Word of mouth recommendations according to a study 92% of people believe recommendations from friends and family over any form of advertising.
Product led growth is a strategy for forward-thinking businesses. It shifts the way that you think. Not just in terms of your product, but the user and the vital relationship between them both.