Product-Led Growth
Product-led growth (PLG) is increasing in popularity, but what do you need to know? Learn the fundamentals of PLG: What it is, why it's critical for business growth, and how it maps to the customer journey.
Everything you need to know about PLG
Discover product-led growth strategies from more than 30 experts in our two-volume guide.
Learn PLG fundamentals, including the product-led customer journey, what environment (cultural and technical) and team (skills and organizational structures) you need, and best practices for success.
Discover PLG tactics and metrics for driving and measuring product-led acquisition, retention, and monetization. Learn how businesses across industries use their products to drive growth and profitability.
What is product-led growth?
Product-led growth is a growth motion that uses your product to drive customer acquisition, retention (activation and engagement), and monetization. With PLG, your product is the primary vehicle for business growth, reducing the need for costly marketing and sales tactics. Read the blog >
Why do you need PLG?
Product-led growth is crucial for accelerating business growth while lowering customer acquisition costs. With the right PLG strategy, you can align your resources to what's best for your customers and your bottom line.
Use our free PLG strategy worksheet to:
- Map your product-led customer journey
- Identify potential risks and how to address them
- Brainstorm tactics to boost customer loyalty and revenue
The product-led customer journey
See how product-led growth tactics impact the customer journey from acquisition to monetization.
Acquisition occurs when prospects turn into customers. With PLG, the product drives new users to sign up through tactics like virality and user-generated content.
Virality involves word-of-mouth, incentivized referrals, and in-product collaboration (Miro boards). With user-generated content, users can distribute content themselves (SurveyMonkey forms or Notion templates), or the product can do it for them (Zapier).
Activation is when a user experiences their first "aha" moment and finds value in the product. With PLG, it's critical to have a simple setup and onboarding process so users can quickly reach the "aha" without intervention.
How to Measure User Onboarding to Better Activate New Users >
Engagement measures how "sticky" a product is or how much users interact with it. With PLG, the product delights users with their current use cases or prompts them to explore net new ones.
Integration is one tactic to increase stickiness—designing products to plug into others without leaving the platform (such as moving Jira roadmaps into Confluence).
Retention, the result of activation and engagement, occurs when users build a habit with your product and return to it after their initial use. With PLG, the product drives ongoing habit formation through usage triggers.
Tactics like push notifications and in-product messages help repeatedly draw users back and increase retention (such as Calm's daily meditation reminders).
Monetization involves gleaning revenue from the value users find in your product, such as by turning free users into paying ones. With PLG, users self-serve checkout by purchasing the product without help from a sales team.
Tactics for self-serve monetization include free trials, credit card trials, freemium models, reverse trials, and pricing updates.
Trial or Freemium? Get the Best of Both with a Reverse Trial >
“PLG enables you to enter accounts early, cultivate product evangelists, and expand into enterprise-scale solutions.”
Product-led growth resources
Explore key product-led growth concepts with resources from industry experts.
Get started with product-led growth
Build the best product for growth with clear insight into your customer journey. Amplitude lets you visualize where users get stuck before activation, your stickiest features for engagement and retention, and your highest-converting journeys for monetization.
Frequently asked questions
Product-led growth is not a magic wand that will solve all your growth challenges. While PLG lowers CAC, it also lowers initial ACV. That said, PLG allows you to land into accounts early and expand from within.
Product-led growth is not only for top-of-funnel acquisition—it drives growth across the entire customer journey. Tactics further down the funnel will create growth despite not being the entry point.
There are four situations where your company might not be ready for product-led growth:
- Your current sales and marketing-led motions aren’t predictable yet.
- Customers can’t activate your product self-serve.
- You have to communicate product value.
- Enterprise buyers have all the decision-making power.
Evaluating your progress on product-led growth comes down to three factors:
- Growth: Can users experience your product's value in a self-service way? Self-serve activation and retention are at the core of PLG.
- Culture: Does your organization ground product decisions in data and experimentation? Are you aligned across Product, Marketing, and Sales?
- Infrastructure: Do you have the right tools to visualize your customer journey and measure your PLG tactics?
Let's say you launch a referral program to increase product-led acquisition. To measure its success, you'll need the right acquisition metrics, such as the number of new signups and the customer acquisition cost. The same goes for metrics to measure product-led activation, engagement, retention, and monetization.
Find relevant metrics for each customer journey stage in our Product Metrics Guide. You can also view example charts in our Demo Experience.
There are varying perspectives on how product-led teams should be structured. For example, should a Product, Growth, or Marketing leader be responsible for driving PLG? Should Growth be a standalone function or combined with Product or Marketing?
Regardless of how you structure your organization, a well-rounded team typically has people with the following skills:
- Analytics
- Digital interfaces
- Consumer psychology
- Content creation
- Customer modeling
- Systems thinking
For product-led growth to succeed, you should consider your cultural and technical environment.
Cultural: You need to be data-driven with democratized access to quantitative and qualitative data. You also need to embrace product-led experimentation.
Technical: You need a growth stack that includes the following tools:
- Access management
- Customer relationship management (CRM)
- Digital analytics
- Lead scoring
- Modern data stack
- User onboarding
- User support
Product-led, marketing-led, and sales-led growth are all growth motions used to drive acquisition, activation, engagement, retention, and monetization.
Marketing-led growth relies on lead generation, awareness building, and education. Sales-led growth focuses on outbounds, product demos, and sales cycles.
Product-led growth privileges the product, but is not a substitute for either marketing or sales. Success hinges on knowing how to use all three in the right sequence.