PLG Starter Pack: A Guide for My Non-PM Friends
Did you ever think I only write for Product managers like me? NOOO, I write for You!, my non-pm friend too. I can tell you most PM principles are applicable in real life and the Product led growth is just one of those principles.
You don’t believe me? LOL, I’m going to prove it to you in this article and the next one.
PRODUCT LED GROWTH:
PLG It’s a go-to-market strategy that puts the product at the forefront of the customer journey. It leverages the product as the key vehicle to;
- Acquire.
- Convert.
- Retain.
- Expand.
Instead of sales being the voice of the product, it gives the product a direct voice to speak for itself, driving growth and retention.
A successful PLG strategy requires cross-functional alignment and involvement across the entire organization. Products are designed to deliver value back to customers after they’ve invested in them.
They’re built to solve challenges so when a customer’s first interaction with a product is of the product giving a level of satisfaction to users. This ultimately brings positive ROI to the business.
PLG uses products to improve user experiences and product adoption leading to better business metrics.
You can adapt the PLG strategy by providing immediate value for your product through free trial accounts and on-the-spot onboarding. Offering a seamless and frictionless experience. The learning phase of your product and adoption phase becomes easier by iterating on product features based on real actionable user data, reducing friction points, and highlighting tools that make your product stick and easier to use. Product is involved in every stage of the customer journey, from acquisition to expansion and this journey starts as soon as a customer engages with the product. Slack, zoom, and Jira are examples of software products that use the PLG strategy.
PRODUCT LED GROWTH VS THE TRADITIONAL FUNNEL MODEL:
PLG differs from the more traditional funnel mentality where marketing engages the customer first, before sales of the product. Traditional models have been mapped with more of a funnel mentality. Only after a prospect becomes a customer is a product able to influence retention and expansion opportunities.
With PLG, the product itself can begin to accelerate the customer journey to reduce customers’ time to value, improve retention efforts and ultimately drive more revenue.
Each stage forms a continuous cycle thus enabling the product to continually contribute to growth.
Acquire: this consists of getting users into your product, often through free trials or freemium experiences. Examples can be: Spotify free trial, free version, and premium, another real-life example is wanting to do a promotional campaign for a drink and doing an event, giving free drinks at the event, by doing this you’re driving sales by using the product itself. Other examples could be simply getting users to sign up for or activate their trial account, and getting prospects over the hurdle to become first-time customers.
A free trial allows you to leverage the product as the vehicle for customer attraction and engagement, driving customer journeys via your product. Free trial is only the first step of an effective PLG strategy.
Adopt: During this stage, your product is driving trial users or prospects to fully onboard and become paying, long-term customers. This means fueling effective adoption through sticky features and driving regular usage converting users from casual visitors to hooked customers. An example was the Spotify African Heat party. I suspect it was a PLG strategy put in place to get more subscriptions, By making a premium profile a prerequisite for the invite, they cleverly attracted and converted users, paving the way for long-term success.
Retain: Getting to the retention phase is when your product encourages customers to renew their subscriptions or package. Retained customers are continuing to realize value from your product, re-engaging if inactive, and have an easy seamless user experience instead of a difficult or complex one.
Expand: This stage puts your product at the center of your revenue growth strategy, either by driving users to upgrade subscription packages to a higher tier or driving additional revenue.
PLG REPLACING SALES?
According to product school, PLG accelerates and scales the efforts of sales and customer success teams. Sales are needed to engage with customers on a human level. Similarly, customer success is key to driving renewals and helping customers realize the full, not just initial value of the product by using product data to better inform customer conversations.
STEPS FOR IMPLEMENTING A PLG STRATEGY
- Before making changes or investments in your product, you must first understand what business metrics or Key performance indicators your organization wants to improve and how your product metrics can drive these improvements:
i. Defining which metrics you want to track.
ii. Decide on what areas you will focus on to improve the metric.
iii. Determining how you will track each metric.
2. Close the gap: Once you know what metrics you want to measure, you’ll be able to see where users are acting as planned and where they’re not getting the full value from your product. You’ll need to implement strategies to close this value gap for users.
The value gap: is the difference between the perceived value a user has of your product and what your product can deliver. A value gap means that users don’t fully understand what your product can help them achieve and to activate and retain users, you need to close the gap.
3. Keep users engaged: User engagement is easily the most talked about in a product’s success. After the users realize the value of your product, successful retention depends on keeping users engaged and invested in your product. This means providing contextual and relevant content to promote additional and continued value.
4. Measure, learn and iterate:
Measure, learn, and iterate: In the journey of Product Led Growth (PLG), it’s crucial to continually measure the effectiveness of your strategies, learn from user data and feedback, and iterate on your product. While in-app communications play a key role in keeping users engaged, they only provide short-term solutions for friction within user experiences. To drive long-term success, successful PLG strategies should be informed by user data, feedback, and the programs put in place throughout your PLG journey.
One valuable tool for tracking metrics that are vital to your product’s success is Gainsight. Gainsight enables you to gain insights into user behavior, identify areas for improvement, and align your product’s roadmap with customer needs. By leveraging Gainsight, you can better understand the impact of your PLG strategy and make data-driven decisions to optimize the user journey and drive expansion.
Remember, successful PLG is an ongoing process of measurement, learning, and iteration. By continuously refining your approach based on user data and feedback, you can unlock the full potential of your product-led growth strategy.
Continued iteration is key to expansion.
This is only a starter pack, if you’d like to learn more about the PLG strategy, you should take the course Product-Led Growth Micro-Certification (PLGC)™ on product school like I did, which this article is based on.
This is not a paid promotion !
I think PLG was explained in detail but the use of Gainsight was not explained in detail. Gainsight can be used to track metrics important to your product’s success.
