The Complete Guide to Product-Led Growth
Product-led growth (PLG) is a go-to-market strategy that relies on the product itself as the primary driver of customer acquisition, conversion, and expansion.
What is Product-Led Growth?
PLG companies like Slack, Dropbox, and Zoom have shown that when your product delivers immediate value, users become your best salespeople.
Key Characteristics of PLG
- Free Trial or Freemium Model - Users can experience value before paying
- Self-Serve Onboarding - No sales call required to get started
- In-Product Upsells - Natural upgrade paths within the product
- Viral Mechanics - Built-in sharing and collaboration features
PLG vs Sales-Led Growth
| Aspect | PLG | Sales-Led | |--------|-----|-----------| | First Touch | Product | Sales Rep | | Time to Value | Minutes | Weeks | | Customer Acquisition Cost | Low | High | | Scalability | High | Limited |
Building Your PLG Motion
Step 1: Identify Your "Aha Moment"
What's the moment when users realize your product's value? For Slack, it's when a team sends 2,000 messages. For Dropbox, it's the first file sync.
Step 2: Remove Friction
Every step between signup and value realization is friction. Audit your onboarding and eliminate unnecessary steps.
Step 3: Measure Everything
Track activation metrics, time to value, and product-qualified leads (PQLs). Use tools like Mixpanel, Amplitude, or Heap.
Common PLG Metrics
- Time to Value (TTV) - How long until users experience value?
- Activation Rate - What percentage complete key actions?
- Free to Paid Conversion - How many free users upgrade?
- Net Revenue Retention - Are customers expanding?
Is PLG Right for You?
PLG works best when:
- Your product solves a clear, immediate pain
- Users can experience value without configuration
- You're targeting SMB or prosumer markets
- Viral or collaborative features are natural fits
Next Steps
Ready to implement PLG? Start by mapping your user journey and identifying where value is delivered fastest.