Every SaaS company strives to ensure consistent growth and unlock new opportunities to scale their operations.
However, the way they devise an action plan to acknowledge consistent growth may vary from one venture to another.
Some may think that exploring different revenue streams and growing sales serves as the best course of action to ensure consistent growth.
Others may choose to improve the solutions they offer and view it as an effective strategy to acquire new customers and maintain high retention.
We think that product-led growth is a viable approach to grow your business, especially in the SaaS industry.
It enables you to acquire new customers on autopilot without having to rely excessively on promotional campaigns. Your customers prefer you over other alternatives in the industry because they’re happy with the experience you offer to them through your solutions.
In this article, we will cover everything you need to know about product-led growth and recommend useful strategies that will help you keep the needle moving.
So, without further ado, let’s start.
How is product-led growth different?
The growth tactics may vary from one company to another. Some may invest heavily in marketing or promotional activities of their products, whereas others prefer hiring an army of sales professionals to generate more leads.
Then there’s product-led growth, which fuels around 58% of companies. Here, companies work on their product and strive to make it stand out from other alternatives in the industry.
We recommend that you strive to maintain the right balance. You should work on making your product better, deploy well-thought-out marketing strategies to generate traction and hire competent sales professionals to boost conversions.
Marketing-led growth requires you to create a buzz around your brand by creating personalized content and promoting your solutions to the right people by leveraging relevant channels and communities.
Sales-led growth calls for your sales teams to grow your operations. The goal here is to capture, nurture, and convert leads. Plus, you focus on minimizing the friction in the customer journey and improving customer support.
Product-led growth works a bit differently. Here, it’s your product that helps you acquire new customers and retain the existing ones.
You are able to cultivate loyalty and establish lasting relationships with your customers due to the enhanced user experience.
As you actively make necessary improvements to meet the expectations of your audience, it becomes easier for you to set yourself apart in the competitive landscape.
The reputation enables you to attract new customers, as your product becomes the core driving force dictating your growth.
What are the benefits of product-led growth?
When you choose your product to fuel your growth, you come across a variety of benefits. Here are a few notable ones that you should know.
1. Focused product development
Continuous improvement fuels product-led growth. For your solutions to generate traction on autopilot, you must strive to offer an enhanced user experience.
Hence, you consistently try to identify the room for improvement and look for ways to make your product better.
As a result, you have better chances of dominating the competitive landscape and trump other players in your respective industry.
You try to be the absolute best in the business, which enables you to come up with groundbreaking ideas and significantly improves product development.
2. Rapid scaling
A product-led growth model enables you to grow quicker compared to your competitors. Having a product that speaks for itself makes it easier for you to unlock new business opportunities.
Furthermore, it helps you attract potential investors and partners down the road, allowing you to access the resources you may need to grow your operations.
You engage your audience at each stage of the customer journey, which enables you to generate more revenue by leveraging potential upselling or cross-selling opportunities.
For example, you can schedule notifications to pitch other solutions that complement your winning product or suggest an upgrade to premium plans.
3. Low acquisition costs
Another benefit of a product-led growth model is that it helps you significantly cut down your acquisition costs.
A product offering a seamless experience to customers complements word of mouth and social proof for your brand.
Your customers are more likely to recommend your solutions to others, helping you attract new prospects with ease. It also becomes easier for you to generate traction organically by leveraging relevant platforms and online communities.
Positive reviews and testimonials about your product are readily accessible. So, it becomes easy for you to convince the intended audience to try your solutions without having to spend a ton of money on promotional campaigns.
4. Better user experience
Product-led growth requires you to constantly refine your solutions, which leads to a better user experience.
The growth model enables you to embrace a customer-centric philosophy. It calls for you to research your audience and identify their problems. You design your solutions to meet their needs and offer value.
When you offer intuitive solutions tailored to the needs and preferences of your customers, you help them achieve the set goals or solve their respective problems.
It translates into a user experience that cultivates loyalty and enables you to establish lasting customer relationships.
5. High retention and loyalty
Product-led growth helps improve retention and enables you to grow your customer base effortlessly.
You make sure that your solutions offer value to your customers and help them solve their problems.
For this, you need an iterative product development process that relies on customer feedback and relevant data reflecting their experiences.
You consistently strive to be better than before, which makes your customers prefer you over other alternatives in the industry.
6. Positive word of mouth
With a product-led growth model, you try to satisfy your customers at every stage of their journey. You facilitate their access to useful information and help them make smart buying decisions.
You strive to improve the experience you offer through your solutions, which significantly improves customer satisfaction.
The more satisfied your customers are, the more likely they are to recommend your product to others. It creates a buzz around your brand and fuels positive word of mouth.
How can we transition into a product-led company?
Now that we have talked about the benefits of a product-led growth model, it’s easy for you to deduce its effectiveness. Let’s go through the steps to transition into a product-led company.
1. Gather useful information
Just like every process, the transition into a product-led company starts with research. Without useful information at your disposal, it won’t be possible for you to come up with fitting strategies to hack growth.
Start by assessing your current operational capacity and resources. You need to ensure that you’re financially stable to embrace a product-led growth model.
Remember, you don’t rely on your sales or marketing teams to generate traction. Your product helps you generate quality leads. So, you may have to consider certain strategies that may cause a dent in your wallet.
For example, you may have to offer a free trial to get more eyeballs and convince your audience to try the solutions you offer. It’s how 27% of the leading businesses in the SaaS industry generate around a quarter of their revenue.
You also need to know your customers and be familiar with their needs or preferences. Without knowing what your customers want, it won’t be possible for you to tailor your product to offer an enhanced user experience. Pick the brains of your sales and customer service teams, or use an online survey tool to gather useful insights about your customer base.
2. Assess your product
The next step is product assessment. You must know the strengths and weaknesses of the solutions you offer.
It’s your product that fuels your growth strategy. So, you need to know your accomplishments thus far and the road ahead.
Your product is the core of your operations. It not only helps your customers solve their problems, but it also facilitates access to useful information, generates leads, and offers support.
From awareness to advocacy, your product walks your customers through the entire journey and becomes the focal point for the experience you offer.
3. Identify room for improvement
Assessing your product helps you identify the room for improvement and improve the experience you offer through your solutions.
You’re not the only one participating in the race. You compete with countless players in your respective industry.
For your customers to pick your product over others, you must make necessary improvements and ensure that your product meets your customers’ expectations.
Continuous improvement is the key to success. You need to think outside the box and come up with innovative ideas for product improvement.
4. Improve user experience
Product-led growth enables businesses to personalize their user experience to the interests and expectations of the intended audience.
You tailor your product to cater to the diverse needs and preferences of the audience segments you target. It’s one of the most efficient ways to enhance customer satisfaction and cultivate loyalty in the long run.
Your ultimate goal is to design a product that offers a holistic experience, helping your customers achieve their respective goals.
It requires you to see things from your customer’s perspective. Empathy is the key to understanding their expectations and acknowledging product-led growth.
5. Improve onboarding process
The product-led growth model helps you design a self-service onboarding process. Your customers don’t need to reach out to you to get answers to questions in their minds.
Your product facilitates easy access to all the relevant information that they need to make informed decisions.
Furthermore, your customers can easily navigate their way through useful learning material or resources that they may need to leverage the solutions you offer to the fullest.
It significantly reduces the friction in the customer journey. Your target audience gets familiar with the capabilities that your solutions offer, which takes you a step closer to acknowledging customer delight.
6. Enhance collaboration
Product-led growth breeds collaboration. It’s a team effort to create a product that offers an enhanced user experience.
You need creative heads in marketing, sales, customer success, and product teams working together to ensure continuous improvement and design a product capable of establishing lasting customer relationships.
You don’t rely on a particular domain to fuel your growth but rather demand a joint effort of all concerned stakeholders to achieve a common goal.
You collect useful information from all departments and see how customers interact with your product. Based on the insights, you identify the areas of improvement and assess how each department can contribute.
Since your product fuels your operations, your teams working in silos is out of the equation. Collaboration becomes essential to improve the experience you offer.
7. Ensure continuous improvement
The goals of your customers change over time. So, product-led growth won’t be possible without continuous improvement.
To fulfill their expectations of your customers, you need to be familiar with their changing needs and plan timely product updates.
You can consider gathering information through customer feedback or surveys. Usage data may also provide you with relevant insights and make it easier for you to identify the room for improvement.
Read more: How to Create Feedback Emails + Templates, Examples & Tips
Taking inspiration from the strategies of your competitors may also help. Plus, you can keep an eye on the latest industry trends.
You can experiment with different features or capabilities and settle for the ones that get you the best results.
Only a constantly evolving product can help you keep your customers happy in the long run and achieve the desired level of growth.
What makes product-led growth superior
The product-led growth model is often a preferred choice for businesses, especially in the SaaS industry. It’s an efficient growth strategy that enables businesses to scale their operations rapidly without having to bear heavy costs.
As you offer an enhanced experience through your solutions, you acknowledge high satisfaction and establish lasting relationships with your customers. Product-led growth fuels loyalty and a positive word of mouth.
Not only does it help strengthen your bond with customers, but it also enables you to improve collaboration at work.
Product-led growth is a joint effort. So, it demands that you mobilize all concerned domains and ensure effective communication to achieve the set goals.
Most importantly, the growth model helps you build a continuous improvement culture, making it easier for you to keep up with the expectations of your customers.
