How do they actually use the product? How can we maximize the outcomes for them?ĬLG therefore relies on extensive customer feedback and qualitative research to determine product development. With a customer-led growth (CLG) model, all internal decisions are taken with the customer in mind. Product-led growth vs customer-led growth It’s a judgment call, but for most SaaS companies, PLG holds the better hand. If your product is designed for large enterprise buyers, then directly targeting your ICP and selling directly to a handful of decision-makers may be faster and more efficient.
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If your product is incredibly expensive to build, then freemium / free trial may not be sustainable. If your product is revolutionary or complex, then the self-educating style of PLG doesn’t work as well. Yet, sales-led growth still has its benefits. In an age where three-quarters of B2B buyers prefer to self-educate rather than learn from a rep, PLG is certainly at an advantage even before you consider the considerable friction and costs (like sales teams’ salaries, for example) that SLG adds to the customer acquisition process. Whereas sales-led growth is a ‘push’ tactic using reps to spread the word, product-led growth is a ‘pull’ tactic using the product as a magnet for customers. They wax lyrical about the brilliant features, offer great deals, provide tailored demos, deliver the contracts, and take control of onboarding.
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They are responsible for bigging up the benefits of the software to a targeted audience to make sales, renewals and upgrades. Sales-led growth (SLG) revolves around a salesperson. In this guide, we compare product-led growth to other SaaS growth strategies, outline the benefits of product-led models, analyze the approaches to PLG and help you decide whether it’s the right strategy for your business. On the other hand, it’s been driven by the simplest reason there is: it makes business sense. On the one hand, the shift from selling to company executives to directly engaging end-users has been driven by macro conditions and consumer behavior, such as falling development costs democratizing software sales. They’re increasingly popular: PLG market capitalization has grown from $21 billion in 2016 to $687 billion in 2020.They scale faster: 83% of public SaaS companies to achieve $100m ARR in their first five years use product-led models.They are worth more: the average PLG company is worth double the public SaaS index.From flag-bearing pioneers like Slack to mature switchers like HubSpot, product-led businesses are starting to dominate the SaaS landscape. Welcome to the product-led growth (PLG) age. Here's everything you need to know about product-led growth, and exactly why PLG businesses are starting to dominate the SaaS landscape.
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