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When product-led growth fails
If you stumble upon Twitter’s marketing rabbit hole, there’s a buzzword you’re guaranteed to see thrown around: product-led growth. Idolized as the growth 2.0 framework for startups, it’s creating its own industry of tools, jobs, and lingo.
Except product-led growth is not meant for most startups. I’ll explain why.
Before we dive in — What is Product-led growth (PLG)?
Product-led growth, pioneered by startups like Dropbox, is the framework of turning your product into an acquisition, activation, and retention driver. Oftentimes it’s implemented as a self-serve free trial or freemium model.
What implementing PLG can look like:
Removing gates to signup for your product
Letting users upgrade themselves
Creating referral loops to drive acquisition
Scalability becomes your best friend. You’re removing yourself as much from the equation, letting your product literally sell itself.
There’s a ton of benefits to product-led growth too. It removes friction from delivering value and is typically much more scalable for user acquisition.
Why shouldn’t every startup do PLG then?
It’s oftentimes not about what startups are built for PLG, but rather when a startup is ready for PLG.
Switching to PLG builds a barrier between you and customers. For startups, this is dangerous.
To become product-led, you need to make a ton of assumptions:
Who wants to use your product
Why they want to use your product
How much they’re willing to pay
... And so on.
It’s a lot of assumptions if you haven’t validated your product-market fit. As someone who runs marketing for a B2B startup, I can’t imagine at our stage removing myself from sales and marketing process.
Onboarding calls are how we learn and iterate our product, marketing, and sales. Every new lead is an opportunity to pitch new features, share a (hundredth) iteration of our pricing, and learn how to activate different segments of users.
How do you start implementing PLG?
Start by validating and automating your sales process, then move up the funnel. It’s an effective bottom-up approach to product-led growth.
The goal is to see how effectively you can remove yourself from the sales process of your product (typically the hardest). If you can validate a self-serve alternative, then it’s worth moving up-funnel to remove other frictions:
Ungate your product signup access
Replace onboarding calls with in-app onboarding flows
Turn customer touchpoints into automated campaigns
Think of it like running an experiment. Changing too many variables leaves no room for validating hypotheses.
Iterate, automate, and validate each step of the funnel at a time.
Don’t be discouraged
You may find that certain steps of your funnel have higher conversion done manually- and that’s okay.
The Twitter and venture capital-sphere have anecdotally glorified product-led as a one-size-fits-all solution. It’s not.
In fact, most of the largest product-led companies weren’t always product-led. They reached product-market fit and scaled through sales-led growth before rewiring their model.
Choosing PLG ultimately depends on your product’s complexity, customer persona, sales cycle, and growth goals.
Thanks for reading! Fun fact: Snails can take naps lasting up to 3 years.