Product-Led Growth: A Customer-Focused Approach to SaaS Business Development

March 16, 2023 | Read Time : 3 mins

What does ‘product-led growth’ mean?

Product-led growth, or PLG, is a business approach which emphasises that product is the primary customer acquisition method. This strategy has emerged as the most effective in the last ten years, particularly for software businesses like Dropbox, Slack, Zoom etc.

PLG method is gradually driving out the sales- and marketing-driven business models that dominated the SaaS sector just a few years ago. User’s needs and capabilities having evolved more and more in this time period led to them not wanting to acquire products without evaluating or comparing it first.

People used to rely on salespeople when making purchases in the past, but today’s prospective customers want to research and use the service firsthand to understand what they will receive. A “try-before-you-buy” strategy does not require a significant investment in marketing.

Indeed, SaaS firms that take this method rely more on word of mouth, pleasant experiences, and a solid reputation since satisfied customers will undoubtedly spread the word about their service.

Designing products with users in mind

If the product is the most important feature of your growth plan, it signifies that all divisions inside the company are working together to improve and enhance it. The following questions show how each team in the business prioritises product development:

Your SaaS program must be more adept than competing goods on the market at resolving user problems. Prospective customers can always test it out by signing up a free trial with a product-led growth plan.

  • How can the product answer the difficulties of our customers?” – Design Team
  • How can we increase interest/demand in the product?” – Marketing Department
  • How can the item drive up revenue?” – Business Team
  • How can we develop a product that benefits our customers?” – Development Team

How to use product-led growth to your advantage

Product-led growth appears to be a very simple strategy, especially if your product markets itself. Moreover, using the following three aspects provides a solid base for a SaaS company to start using PLG methodology.

Understanding your worth

Unfortunately, many SaaS startups don’t know what makes their product unique for the intended audience. Whether it is a reduced price or an additional feature that your rivals do not provide, the core value of your product is a crucial component of a PLG strategy and a crucial differentiator in the market for SaaS solutions.

Clearly communicating the value of your product

You cannot demonstrate the advantages of your product without the preliminary stage. Your SaaS solution’s fundamental value should be obvious and unique. People often do not understand why your application is better than others; thus, you must demonstrate and explain this.

Keeping your promises

Finally, offering the expected and promised services is critical for a product-led growth plan since it depends on your application’s performance and functioning. If you do not deliver on your promises, it may result in a bad UX and, as a result, no paid subscriptions after the free trial.

Advantages of a product-driven growth strategy

The two main advantages of this strategy are:

Faster scaling

Product-led companies may expand considerably quicker since their users evaluate the product immediately through free trials. The onboarding procedure is instantaneous and, in most situations, does not need the intervention of customer support.

Customers become familiar with the program considerably more quickly as a result. They can immediately utilize the service, so they don’t need to read or educate themselves about it.

Lower the cost of customer acquisition

The sales cycles get noticeably shorter if your consumers self-onboard. Additionally, a PLG business does not require sizable sales, marketing, or customer service staff. Because new customers only join after discovering the value of your product, not as a result of expensive advertising, the expenses of client acquisition are relatively modest.

The product-led growth model is based on a useable and effective product that demonstrates its benefits at each user’s click, without any sneaky or sophisticated marketing or sales strategies. This does not imply that the tactic is any less difficult or intricate. You should still consider advertising, but you should do it carefully.


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Team OriginUX

OriginUX Studio is a CoE for User Experience providing UI & UX across Product, Service and Customer Experience Design. We are a cross-disciplinary design team that loves to create great experiences and make meaningful connections for businesses and their users through UI & UX.

Founded in 2016, our larger purpose is to help brands understand what they want to do and where they want to go. To do that we have to make understanding customer experience simple, effortless, and affordable for everyone.

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