By: Guillermo Padilla, Group Product Manager of BEE
Product-led Growth (PLG) is a relatively new model that has been adopted by many of the most successful tech companies. Its core principles center on (1) delivering upfront value, (2) implementing user-centered design, and (3) investing in a product that drives acquisition. But there is an element that is often missed in the product development process: creating a friction-free user experience.
In a product-led approach, brands want their users to get the core value as soon as possible because it’s ultimately the product experience that guides the purchase decision. When users experience more friction than benefits, they stop using the product and drop off the customer journey.
PLG is an essential strategy for SaaS companies looking to facilitate the adoption of an app, subscription or tool. Potential customers experience the value of the product upfront and immediately decide if it solves their problem or helps them accomplish a goal. As technology advances, companies are finding new opportunities to leverage PLG. Let’s explore how to think about product-led growth in a friction-free framework.
Delivering upfront value
In a PLG approach, the buyer journey happens inside of the product. Not only can customers “try before they buy” but the product actively solves their problems before any transactions are made. To achieve this, it’s necessary to break initial signup barriers, including paywalls that force a purchase decision before the customer experiences tangible benefits.
Common approaches to break this barrier are free trials or a freemium model. Free trials and freemiums seem like the same thing but are actually quite different.
Trials typically include all of the benefits and features of a product, but with a limited time frame. On the other hand, the freemium approach includes the use of a service for an unlimited amount of time but requires an upgrade for premium features. To determine the best approach for your own product, you can use this quiz from Productled.com.
Implementing user-centered design
Removing paywall barriers is only effective as the quality of the user experience inside the free trial or freemium. Friction-free refers not only to the experience of signing up for the product, but also deriving benefit from it.
Users should be able to solve an immediate problem using the free trial or freemium without friction. Common points of friction at this stage include steep learning curves or a need for additional products. The more that users need to seek information or leave your product interface, the more friction that they will feel. Strong UX design keeps users in your application and makes their experience seamless so that they will want to return to your product the next time they face the problem it solves.
Investing in a product that drives acquisition
A PLG strategy requires companies to invest in a product offering that drives acquisition. This is done by developing a product that solves an immediate, tangible and recurring pain point so that users become ambassadors for the brand.
When a user experiences recurring value from the product they are more likely to become an advocate, actively engage with the product, provide feedback to the brand, and communicate with peers about their user experience. This cycle leads to product refinement, new businesses, and expansion opportunities.
Who should use the PLG model?
It may not fit with all goals, strategies, or targets. PLG usually means reaching users first, not decision-makers, which also means developing a bottom-up approach to generate expansion opportunities. This is not ideal for some buyer models.
Other factors, like company culture, might be another reason not to adopt this model. Successful PLG calls for an “all-hands-on-deck” mentality. It’s critical that all teams, from developers to marketing and sales, thoroughly understand the problem the product solves for. Many companies operate in silos and for this reason, PLG may be challenging to operationalize.
To implement a successful PLG model, it is important to lean into the friction-free approach when designing products and processes. By offering an easy-to-use product that immediately delivers value, product adoption flourishes, and sales naturally follow.