How to build a product-led growth strategy

What Is Product-Led Growth (PLG)?

Product-led growth (PLG) is a product-led go-to market that focuses on creating a product that “sells itself”. It's different in a sales-led approach, where you rely on sales to drive growth. With PLG, the goal is to create software that is so valuable, shareable, and easy-to-use that users sign up without being sold to. 

The marketing funnel is an important part of PLG. When you have a good funnel and a good product, the end result is sustained, organic growth for your user base. In this article, we'll explain how you can create both a PLG-optimized product and a funnel built around it.

Competitive pricing strategies can come in many forms, a business can choose to always be the cheapest of their competitors or always offer the average price of the highest and lowest priced competitors

A competitive pricing strategy is a price-setting that is based on your competitors’ prices. This pricing method focuses solely on the prices of your competitors that are public, but it does not take into account how much customers value the product or production costs.

A strong competitive pricing model is based on thorough market research. When you know how the prices of your top competitors in your market and how those prices might meet customer expectations, you have a basis for determining the rates of the prices of your own products or services. Competitive pricing strategies can come in many forms, a business can choose to always be the cheapest of their competitors or always offer the average price of the highest and lowest priced competitors - they all count as competitive pricing strategies.

What to expect when adopting PLG?

Many startups believe that adopting a product-led growth (PLG) approach is easy, but that's not the case. It requires careful planning and expertise to execute successfully. Why? Because when you have a sales-led approach, your product only needs to be good enough to sell, and your main focus is on generating leads and converting them into sales.

Gain Marketshare and increase revenue
Position your products compared to competitors
Analyse the pricing of competitors and learn

With PLG, it's a different story. Traditional metrics like pipeline size and MQL count don't matter. The most important things are user adoption and referrals. 

This means you need to focus on building a great product that attracts and retains users organically. Achieving this requires a different set of skills, roles, and workflows compared to traditional sales, and may involve hiring new team members with different skillsets.

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Gain Marketshare and increase revenue
Position your products compared to competitors
Analyse the pricing of competitors and learn

Here are the main things to expect when adopting PLG. 

  • You’ll need bandwidth. To transition to a product-led growth (PLG) approach, you'll need to free up resources and focus on new metrics. You can do this by hiring a dedicated PLG specialist or consultant.
  • New KPIs and OKRs. New metrics like usage rate, time-to-value, and monthly active users are critical for tracking growth. This means traditional metrics like MQLs and SQLs are no longer as relevant.
  • New funnels. The focus should be on increasing usage and referral rates, which requires a new funnel that is mostly or entirely inside the product.
  • Deep cooperation. You'll need a team of engineers, data analysts, and customer-facing members to work together and create an outstanding product.
  • Self-serve checkout. PLG motions are heavily reliant on self-serve users driving growth. You need interactive, URL-based quotes and a strong subscription management system to process purchases at scale. 

If you have the bandwidth and flexibility to add a product-led motion to your current setup - wonderful. If you’re not sure, don’t jump into PLG without looking. The approach works best when companies are truly invested in the strategy.

Choosing the right pricing model for your SAAS business

Aside from the pricing model type, you must consider many other factors. Ask yourself the following questions when deciding what model works best for your business:

  • Customer base and target market:
    What are they looking for?
  • Competition: What are the other
    companies in your market doing?
  • Value proposition: How much value
    can you offer for each pricing option?
  • Product and pricing strategy: Which pricing model aligns with your business goals?
  • Van Westendorp model: Do you know your customer's willingness to pay for your product?

Don’t worry about choosing the wrong pricing model. The idea isn’t to do a perfect job; it’s to do the best job possible.

Once you have launched your product and corresponding pricing model, never stop testing, gathering feedback, and analyzing data. This way, you’ll always be in a good position to switch to a better pricing model.

Let’s wrap up…

  • There are 9 main pricing models to choose from in SaaS. User-based, custom, hybrid, feature-based, freemium, tiered, flat rate, usage-based, and inverse pricing.
  • Pricing models need to make you money, keep clients happy, and increase your appeal in the marketplace
  • The pricing model you use can (and likely will) change over time. Make a choice now, but be prepared to change your mind later

How to Build a Successful PLG Strategy

To create a successful product-led growth (PLG) strategy, you need to focus on three main pillars.


Understand your ideal user

Understanding your users’ needs, pain points, and behaviors is key in product-led motions. This is important because it lets you…

  • Create a quality product for your ideal user, shortening time-to-value and increasing user satisfaction
  • Create a PLG-optimized sales funnel that guides users from trial to referring new users
  • Support users with onboarding content and other resources they need to get more out of your product
  • Choose the right sales pricing models, such as freemium or subscription-based, to maximize adoption

You can gather this information through usage data, competitor research, surveys, user testing, and user feedback. Dedicating time and effort to identifying your ideal user cannot be overstated. Critical! 


Build a product-led growth funnel

A product-led sales funnel is very different to a traditional sales-led one. The goal isn’t to grow your pipeline and convert it into sales. It’s to maximize usage and referrals. The classic product-led sales funnel looks something like…

  • Acquisition: Attracting your ideal clients with a frictionless sign-up process and attractive marketing.
  • Activation: Guide prospects through the onboarding process and show the value of your product.
  • Retention: The most important step. You must provide ongoing value, support, and satisfaction to prevent churn.
  • Referrals: Use your product as a platform to drive referrals (as well as up-sells and cross-sells)

Since the funnel is mostly built directly into your product, the focus is on things like…

  • A free (and easy) trial sign-up process
  • Easy, quality onboarding that makes the product easy to use
  • No friction points during usage
  • Pricing models that are attractive and easy to opt into
  • Offering useful upsells and cross-sells

Building a product-led sales funnel can be a lot to manage. However, you don't need to do it alone. From interactive quotes to billing and managing entitlements, Salesbricks can take a lot of work off your hands. To see how, book a free demo today. 


Experiment, collect data, and iterate

Experimentation, iteration, and data analysis are three broad functions. That being said, they should look like one fluid motion in a PLG approach.

Thoughtful experiments show you which product and marketing funnel changes drive more growth. Data from your experiments gives you valuable insights on product and marketing. Insights gleaned from data help you…

  • Understand which features and UX elements customers like and use
  • Which funnel and product features produce friction that slows growth
  • Which targeting and messaging combinations work best for
  • Users’ overall preferences (demographic, psychographic, etc)

There are many ways to run experiments. You can do so via A/B split tests, by giving limited-access features to some users, etc. What matters is having an ongoing process where you try new things and learn from them. 

Scaling your PLG motion

A PLG motion requires continuous product development and optimization - especially if you want to scale and expand it. Key focus areas are…

  1. Product Development: Continuously improve your product to meet customer needs, add new features, and stay ahead of the competition.
  2. Optimize Pricing and Packaging: Experiment with different pricing models and strategies. Make pricing attractive and fair for users - but also profitable enough to keep the lights on!
  3. Focus on Customer Referrals: Encourage satisfied customers to refer new customers by offering incentives, e.g. discounts or free features.

Examples of companies that have successfully scaled their PLG strategy:

  • Slack: Slack's growth process has focused on creating a highly engaging product that drives user adoption and encourages team collaboration. Their freemium model allows users to try the product for free, which has helped drive rapid growth.
  • Dropbox: Dropbox's strategy centers around making it easy for users to store, share, and access files from anywhere. Their referral program, which offers additional storage space to users who refer new customers, has been a smart scaling tactic.
  • HubSpot: HubSpot offers a friction-free upgrade path and an expansive feature set. This allows customers to start small, then scale up their product usage as they become more familiar.


  • By focusing on providing immediate value to customers and optimizing the user experience, businesses can use product-led growth strategies to drive rapid growth and customer loyalty.
  • Understanding customers' needs and behavior creates a solid foundation for building a successful PLG strategy.
  • User-driven experiences are both the present and future for business growth. By leveraging analytics, companies can monitor user behavior, optimize customer experience and ensure product-market fit.

If you're looking to start building your PLG strategy, Salesbricks can help. Our platform is designed to provide the data and insights you need, allowing you to optimize the user experience and maximize the ROI of your PLG efforts. Book a free demo to learn more.

The salesbricks solution

Choosing a pricing model is hard in and of itself

Actually applying your pricing model is even more difficult. You have to show prospects quotes, collect payments, manage subscriptions and access… It’s a lot of work

That’s why we created Salesbricks to make your life easier

Our software helps you create offers and quotes, manage subscriptions, and automate payment processes - renewals, cancellations, etc.

With Salesbricks, you can apply any kind of pricing model in minutes

You can also do complex things instantly - for example, test different pricing models against each other or adjust your pricing model on the fly