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Anand Arivukkarasu: Product Leader| Advisor | Ex-Facebook
How a company grows often depends on more than just traditional marketing tactics. A new approach called Product-Led Growth (PLG) is changing the way businesses acquire, retain, and engage users. Rather than relying on large marketing budgets, PLG puts the product itself at the center of growth. This strategy allows users to experience the product firsthand, leading them to naturally share and stick with it. Growth isn’t driven by advertising or promotions, but by creating a product that users love and want to keep using.
In this blog, we’ll explore what Product-Led Growth is, why it’s becoming so popular, and how Growth Product Managers (GPMs) are at the heart of making it work. From crafting features that users can’t live without to using data for smarter decisions, GPMs play a vital role in shaping a product that drives growth on its own.
Product-led growth (PLG) is a business strategy where the product itself becomes the primary driver of acquiring, retaining, and converting users. Instead of relying on traditional marketing campaigns or spending heavily on user acquisition, the product is designed to attract and engage users on its own. As users experience the product, they continue to use it and share it, leading to organic growth.
Product-led growth (PLG) is a business strategy where the product itself becomes the primary driver of acquiring, retaining, and converting users. Instead of relying on traditional marketing campaigns or spending heavily on user acquisition, the product is designed to attract and engage users on its own. As users experience the product, they continue to use it and share it, leading to organic growth.
Traditionally, businesses spend significant amounts of money on advertising to attract users. In contrast, product-led companies focus on creating a product that users naturally gravitate toward and share with others, which lowers marketing costs. Companies like Facebook, for example, have built massive user bases by designing a product people want to share, without needing to spend extensively on paid ads.
PLG initially became popular with consumer-focused tech companies like Facebook, Uber, and Airbnb, where the product itself was enough to draw users in and encourage them to spread the word. Now, this strategy has been embraced by SaaS companies like HubSpot and Atlassian, which leverage their products as the main tool for user acquisition and growth.
There are a few key reasons why PLG has become more popular:
Growth Product Managers (GPMs) play a critical role in driving a PLG strategy. Their responsibilities revolve around making sure the product itself is a growth engine. Here are the five key responsibilities of GPMs:
At the core of PLG is the need to create products that users genuinely love, not just find useful. GPMs focus on aligning the product’s features and design with what users need and want, ensuring strong product-market fit.
Key Aspects of Building Products Users Love
A key part of PLG is integrating virality and stickiness into the product design. Virality refers to how easily users share the product, while stickiness refers to how often they return. Both aspects require thoughtful design and collaboration between product, marketing, and design teams.
Virality is when a product encourages users to share it with others. This doesn’t just happen; it’s engineered. For example, referral programs like those in Uber, Airbnb, and Dropbox incentivize users to bring in others. A user might get a discount for inviting friends, creating a natural way for the user base to expand without significant marketing spend.
In some cases, virality is built into the product itself. For example, Dropbox becomes more useful when shared, as users can collaborate on files. This motivates users to invite others to the platform.
Stickiness is about making sure users keep coming back. It involves designing features that are indispensable to users. For example, Messenger’s integration with Facebook’s platforms allows for seamless communication, which keeps users engaged and makes it harder for them to switch to another service.
GPMs work closely with other teams to design features that encourage sharing and engagement. By running experiments and analyzing data, they determine which features are most effective in driving user referrals and retention. This helps them make informed decisions about how to further improve the product’s viral and sticky elements.
One of the most powerful ways that GPMs can drive growth is by using product decisions to influence the user journey. They don’t just design the product and then hand it off to sales and marketing. Instead, GPMs are actively involved in crafting the go-to-market strategy, shaping pricing models, and guiding how features are introduced.
Collaborating with Go-to-Market Teams
GPMs work closely with sales, marketing, and customer success teams from the start. Their involvement ensures that the product, its messaging, and its positioning are all aligned with user needs.
Using Monetization as a Growth Tool
The way a product is priced can be a powerful growth lever. GPMs use various pricing strategies to encourage users to experience the product before they pay. These models include:
For example, Disney+ offered three months of free service before charging a subscription fee, allowing users to experience its value upfront. Similarly, HubSpot and Slack use freemium models, allowing users to explore their platforms before deciding to upgrade to paid plans.
Identifying the right growth channels is crucial for a PLG strategy. GPMs look for ways to leverage partnerships, integrations, and platform ecosystems to expand the product’s reach without relying on heavy marketing spend.
Partnering with Platforms and Companies
GPMs work with other platforms and companies to tap into existing user bases. For example, when Facebook launched Messenger for Business, they initially targeted their existing user base. However, to scale further, they created a Messenger Live Chat Plugin that allowed businesses to integrate Messenger directly into their websites. By partnering with platforms like Shopify and GoDaddy, Facebook extended Messenger’s reach to millions of merchants, dramatically increasing its user base.
Leveraging API Integrations
APIs allow GPMs to make the product more sticky by integrating it with other platforms. These integrations not only add value for users but also create new opportunities for growth. For instance, Facebook allowed Shopify merchants to integrate Messenger into their stores, making the platform more useful for businesses and helping Messenger grow its user base without additional advertising.
Building Partner Programs
As companies grow, they often build ecosystems around their products by encouraging third-party developers and agencies to create tools and services that integrate with the core product. For example, platforms like HubSpot and Zapier have built partner programs where developers and agencies extend the platform’s functionality. These ecosystems fuel growth by making the product more versatile and essential for users.
The fifth key responsibility of GPMs is ensuring that all teams are aligned on the product’s goals and metrics. Data is central to this task. GPMs rely heavily on product analytics to track how users interact with the product and to make informed decisions about how to improve it.
Using Data to Drive Decisions
A successful GPM uses data to understand user behavior, engagement, and satisfaction. They rely on tools like Pendo and FullStory to track how much time users spend on the product, which features they use most often, and how many users are fully adopting the product’s capabilities.
Running Continuous Experiments
GPMs constantly run experiments, testing different features and product experiences with specific user segments. They track how different cohorts respond to new features and use this data to make continuous improvements. This process of testing and learning ensures that the product evolves in a way that maximizes user satisfaction and engagement.
Aligning Teams Around Metrics
Finally, GPMs play a leadership role in aligning teams around shared goals. They work across sales, marketing, engineering, and customer success to ensure that everyone is working toward the same objectives. By clearly defining key performance indicators (KPIs), GPMs ensure that every team is focused on driving product success.
In a Product-Led Growth strategy, Growth Product Managers play a critical role in driving growth through the product itself. By focusing on creating products users love, building in viral and sticky elements, leveraging data, and working closely with marketing and sales teams, GPMs ensure the product can grow organically and sustainably without the need for massive marketing budgets.
Product-Led Growth (PLG) is a strategy where the product itself drives how a company gains, retains and converts users. By creating a product that delivers real value, companies can rely on user engagement and satisfaction to fuel organic growth, without needing to rely heavily on traditional marketing or sales tactics.
Product growth refers to any growth in user base, revenue, or market share driven by improvements to the product. Product-Led Growth (PLG) specifically focuses on using the product as the main driver for acquiring, retaining, and converting users, making the product the central growth engine instead of external marketing or sales efforts.
The benefits of Product-Led Growth include lower user acquisition costs, a more scalable approach to growth, increased user satisfaction through direct product engagement, and more sustainable organic growth driven by users sharing the product with others. It also helps create a seamless user experience that fosters long-term retention.
While no single company or person “started” Product-Led Growth, it became widely recognized through companies like Dropbox, Slack, and Atlassian, which pioneered the approach by focusing on product experiences to drive user adoption and growth without relying heavily on traditional marketing or sales.
Exact numbers are difficult to determine, but thousands of companies—especially in the SaaS and tech industries—are adopting Product-Led Growth strategies. Businesses like Zoom, HubSpot, Canva, and Notion have embraced PLG, and its popularity continues to rise as more organizations shift to this model for sustainable growth.
Anand Arivukkarasu: Product Leader| Advisor | Ex-Facebook
