Why Product-led Growth is the Future?

by Elena Verna

3/17/20243 min read

Today I listened Why product-led growth is the future | Elena Verna (Amplitude, Miro, Surveymonkey) in Lenny's podcast. Here is the link if you'd like to listen.


Here below the key points I gathered.

Why B2B products are not shiny and fun? (comparing to B2C)

B2B buyers are not the users of the product. So they look for utility not if the product is shiny or not. but in B2C the situation is different.

But in the last decade this is changing since B2B decision makers are becoming the ones who will use the product. So B2B products are becoming shiny and fun.

B2B product users are more into

  • How they work?

  • What feelings they invoke in you?

  • How much habits they built with you?

  • How much is it part of your life?

B2B Product manager thinks like you'll be more powerful, you'll be more successful with my product.

Product Led Growth: Lets check Miro and Slack examples.

None of the enterprise buyers asked to purchase Slack or Miro. Users ( the employees ) forced the companies to use these products because they were claiming that they'll more productive that way.

Product Growth: you have to answer three questions:

  1. How to acquire ?

  2. How to retain?

  3. How to monetize your customers?

As a company you need to decide 'Which part of your growth strategy based on PLG- acquisition, retention or monetization? '

Retention falls into two main KPIs

  1. Activation

  2. Engagement

Acquisition of Product Led means: Users invite or users refer or users create content to attract other users.

If your product does not able to activate and more importantly engage via habitual loops and being an habit then you have no chance to hook in acquisition engine to your product.

So first focus on Product led retention, activation and engagement !

In product led growth users need to collaborate, communicate. If it is a single mode relationship between product and user it is harder to go with product led growth. so marketing or sales led growth shall be chosen.

Important: Sales led and product led can and should go together. It is a sequential play.

Product led sales focuses on user value, has incredible cost of acquisition (a lot cheaper).

Product led sales focuses on pipeline creation that is usage.

Product led growth means after the acquisition the product creates usage without any other peoples' involvement. The acquisition could marketing led or product led.

Freemium vs Trials

By definition, a free trial is a customer acquisition model that provides a partial or complete product to prospects free of charge for a limited time. A freemium model is a customer acquisition model that provides access to part of a software product to prospects free of charge, without a time limit.

Free trials do not work for Enterprises.

  • Time frames are different in every company.

  • Customer voice: Don't time bound me in this stressful environment where time is not a usage metric

Freemium example : Miro! they just give 3 editable boards for free. Some people won't pay ever but that's OK for Miro. They will acquire more users for Miro or the content (templates) they create is just enough.

Freemimum is breeding ground for adjacent personas and use cases that you can discover. or you'll be collecting data to allow you build your product.

Linkedin is a great example for freemium. network effects. Without freemium they could never sell anything to anybody.

So the strategic impact for the freemium shall be defined before applied.

Freemium has to check one of these boxes.

  • Does it help my indirect monetization? (some sort of virality or network effects )

  • Does it suffice for every single user regardless of their complexity

  • Does it help my AHA! moment?

  • Does it create habit loops? (notifications, channel communications etc)

Anything that creates friction for my growth model I'll probably gatet in the paid anything that promotes my growth model I put free (without sacrificing monetization potential)