Is product-led growth right for my business?

Let’s get one thing clear: PLG is not an exclusive club
Product‑led foundations
Product‑led Growth cOLLECTIVE

Just like coding has been democratized through no-code tools, growth is no longer the sole purview of the sales team. Instead, companies like Pinterest, Buffer, and Appcues have prioritized customer acquisition à la product-led growth.

Product-led growth (PLG) is a business methodology in which user acquisition, expansion, conversion, and retention are all driven by the product itself. It creates company-wide alignment across teams—from engineering to sales and marketing—and uses the product as the largest lever of sustainable, scalable business growth.

Evidence supporting PLG as a growth model is widespread. Product-led businesses see lower CAC (customer acquisition costs), shorter sales cycles, higher customer satisfaction and NPS (net promotor score) scores, higher customer retention and lifetime values (LTV), and larger valuations.

According to Bain, companies that prioritize PLG achieve faster growth in comparison to those with limited or no focus on PLG. Additionally, they are almost 3x as likely to have gained market share in recent years when compared to their non-PLG competitors.

Sounds great—but you’re probably wondering at this point, “is PLG right for my business?” That’s what we’re here to help with.

Let’s get one thing clear: PLG is not an exclusive club

Experts often frame product-led growth as something exclusive, reserved only for the most consumer-like SaaS businesses (think Canva or Grammarly); or those that offer freemium products, massive user bases, well-staffed data science and growth teams, network effects … the list goes on. Through that lens, your business is either product-led or it’s not.

But PLG is not a status or goal to achieve—it’s a strategy. Everything your business does can be done in a more product-led way, from how you engage your customers to how you enable your teams. 

Rather than thinking of PLG as an exclusive designation reserved for the most consumer-like SaaS businesses, it's helpful to think of it as a spectrum. At the Product-Led Growth Collective, we group businesses into one of 3 maturity stages: Starter, Transformer, and Elite (which we’ll get into later). 

Is product-led growth right for my business?

We think every business can reap the benefits of PLG. But certain factors (which we'll get into below) can impact the feasibility of a PLG transformation for your business in certain conditions. So really, the question isn't “Is PLG right for my business?” The question is, 'is PLG right for my business right now?'

Regardless of your answer, the principles of product-led growth are applicable—and beneficial—to virtually any business, SaaS or otherwise. 

That’s because PLG is a response to consumer behavior and preferences. It’s a strategy that capitalizes on humans’ desire to do things on their own as quickly and efficiently as possible. So if you sell to humans, it only makes sense to align your product according with their actual behavior.

Factors like target market, competition, product maturity, and available resources inform both where to focus efforts and what to expect when building a product-led motion. Let’s dive in. 

Benefits of product-led growth

Product-led growth can be beneficial for businesses looking to scale quickly and increase their user base. While not every business will benefit from a full-scale PLG strategy, there are still ways to be more product-led in your approach to growth that are beneficial to your bottom line.

  • Increased customer acquisition and retention: A successful PLG model is often determined by acquiring more customers at lesser costs. This means that your minimum viable product is so good it stands on its own without having a still-important sales and marketing team behind it.
  • Better product-market fit: PLG products are purpose-built to meet customer needs, so they require minimal handholding to get started. This means higher conversion rates and more revenue from each customer, resulting in an overall higher LTV.
  • Faster growth: Thanks to fewer constraints from large sales teams (i.e., no red tape) and resource-intensive lead generation, PLG companies tend to grow fast. While growth now may not be as quick as in the early days, OpenView Partners’ data suggests product-led companies are more than twice as likely to grow quicker than sales-led companies. 
  • Improved customer experience: Products are designed for easy understanding and onboarding so that users can find value quickly—which means they’re more inclined to open their wallets quickly, too.
  • Greater understanding of users: PLG also allows SaaS businesses direct access to their users' behavioral patterns within their service, from which they can extrapolate to refine their product. This allows them to craft a product that is well-suited to the customer's needs, resulting in higher customer satisfaction and loyalty.
  • Cost savings: PLG can help businesses reduce costs associated with traditional marketing and sales tactics. By focusing on creating a product that sells itself, businesses can save money on costly marketing campaigns and focus their resources on improving their product. This can help businesses scale quickly without increasing their overhead costs.
  • Higher lifetime value of customers: Product-led growth reduces the need for expensive marketing campaigns and allows businesses to focus their resources on refining the product to meet customer needs. Additionally, the PLG model can help businesses to generate more revenue from each customer, resulting in higher profits for the company.

Now back to the reason you’re here: “is product-led growth right for my business?” Perhaps instead, you should ask, “in what ways can my business be more product-led?”

How to know if PLG is right for your business

Before considering the finer details, it’s important to understand who will find PLG most effective. Product-led growth works best (though not exclusively) for businesses with a SaaS model, with more transactional sales and affordable price points

If this sounds like your business, then you can move on to more pointed considerations, which we’ve broken down into 3 core groups: competition and market conditions, team and resources, and product maturity and readiness.

Infographic showing questions to ask yourself to become more product-led

Competition and market conditions

In the early stages of assessing the PLG model for your organization, you need to look outward before you look inward. Ask yourself the following questions:

  • Product-market fit: Is there a large and growing market for your product? Are there untapped or under-served segments within your target market?
  • Competitors: Who are your main competitors, and what are their strengths and weaknesses? What sets your product apart from theirs?
  • Initial cost: How much does it cost to acquire a customer through traditional marketing and sales channels?

Team and resources

When thinking about your team and resources, consider the following:

  • People: In PLG, there is a customer-focused mindset throughout your organization, with everyone dedicated to understanding and meeting customer needs. PLG works best when the team has a healthy mix of product-related skills, such as product management, design, and data analysis. It’s also vital that product is at the center of all decision-making processes. A culture of experimentation and continuous improvement is also a requirement, with a team that’s encouraged to continually test new ideas and strategies to drive growth. 
  • Ask yourself: Do I have the right mix of talent to implement this model? Can I get my existing team on board with this growth model?
  • Technology: PLG works best when there are tools and resources to track and analyze data on customer behavior, usage, and engagement. 
  • Ask yourself: Am I willing to invest in the tools and resources required to track and analyze data on customer behavior, usage, and engagement?
  • Budget: PLG works best when there is a healthy investment in product development, customer support, and technology infrastructure.
  • Ask yourself: Can I justify this investment? Where do I need to make sacrifices?
  • Marketing: PLG works best with scalable marketing strategies like content marketing, search engine optimization (SEO), and social media marketing. 
  • Ask yourself: Do I have the right marketing strategy to execute PLG effectively?

Product maturity and readiness

Finally, this group of questions asks you to look at your product, the one thing you have the most control over. Consider this:

  • User experience: PLG works best when the product is intuitive, easy to use, and solves the customer's problems
  • Features: PLG works best when the features included in the product are competitive, uniquely different
  • Performance: PLG works best when the product is fast, reliable, and scalable to handle increasing usage

Ask yourself:

  • Can my users realize value fast, without help? 
  • Who are my main competitors, and what are their strengths and weaknesses? What sets my product apart from theirs?

How to implement product-led growth in your business

You need 2 things: business maturity and a detailed strategy. We’ve already addressed the maturity model. The second–strategy–is a bit more complex. Here’s a three-pronged approach you can use to start building out your strategy:


Starting with how you acquire customers, you might need to overhaul your existing system or create something entirely from scratch.

  • Assess your current approach to customer acquisition and retention, including your sales and marketing processes, customer support, and pricing strategy. 
  • Identify areas for improvement and align them with your product-led growth goals. 
  • Simplify your onboarding experience and provide excellent support, making it easier for customers to get started with your product. 
  • Consider offering freemium or trial versions of your product and publishing pricing publicly to shorten time to value.


Starting with how you acquire customers, you might need to overhaul your existing system or create something entirely from scratch.

  • Prioritize user experience by building products that are intuitive, user-friendly, and self-serve.
  • Reduce ongoing friction in the customer experience by offering self-serve support options such as in-app tutorials, knowledge bases, and community forums
  • Implement user feedback to offer the most useful version of your product


  • Use data to understand how customers use their products and where improvements can be made. 
  • Use data to personalize the customer experience, tailoring the product and customer support to meet the unique needs of each user
  • Implement a data-driven culture within your organization to inform product development, customer support, and marketing efforts

Next steps: putting PLG into action now

If you’ve made it this far, then you’ve probably decided to implement PLG into your business. There are 2 ways to start putting product-led growth into action: 

The PLG Flywheel is a framework that segments users according to where they are in their journey, from Stranger to Evaluator to Beginner to Regular and then Champion. It also includes the actions users must take to graduate to the next stage: Evaluate, Activate, Adopt, Expand, and Advocate.

Product-led Growth Flywheel

The goal of the flywheel is to help you focus your strategies on optimizing the user experience to move users from one stage to the next as quickly as possible. As the rate at which users move from one segment to the next increases, this creates a positive feedback loop of more advocates = more acquisition = exponential growth.

We’ve already covered the flywheel in-depth here: The Product-Led Growth Flywheel.

Second, you need to find where you fit on the scale of maturity that we mentioned earlier. Here’s what you need to know about each stage:

  • Starter: Companies at the Starter level are beginning to explore PLG strategies, such as offering a freemium version of their product and gathering customer feedback to refine the product.
  • Transformer: Companies at the Transformer level have implemented more advanced PLG strategies, such as creating a viral component (like a referral program) and leveraging data science and growth teams.
  • Elite: Companies at the Elite level have fully embraced PLG as part of their core business model and are maximizing their customer lifecycle value by focusing on user experience.

Identifying which stage your company falls under can help you understand where to begin with adopting PLG as a strategy.

To reiterate, an in-depth product-led growth strategy might not be right for every business. However, that doesn’t mean it won’t be beneficial to explore what elements or lessons you can take from the model to apply to your own business. And if it is right for you, congratulations–you’re well on your way to exponential growth.