February 4, 2020

How Product-Led Growth (PLG) Differs from Product Marketing

a rocket launching from a computer

If you are beginning to learn about product marketing and product-led growth (PLG), you may be curious about how the two concepts relate and how they differ. 

If you are bringing a product to market you will leverage product marketing. If you already have a product on the market, you are actively conducting product marketing. With any product, product marketing is a necessity. 

However, the same is not true for PLG. You may never leverage PLG in your product strategy and still be successful.

What is Product Led Growth (PLG)?

PLG is a way to enhance your go-to-market and product strategy by increasing the methods of acquisition, retention and expansion around your product. The term was coined by Openview Venture Partners

The premise of PLG is that companies allow people to use a limited version of their product for free. As it provides value to users, it becomes integral to their daily lives. Eventually, users introduce the product to their peers and more people begin to use it, garnering adoption

Since users get firsthand experience with the product and can try it without making any commitments, PLG often leads to word-of-mouth marketing. Many consumers see a PLG product for the first time because their friends or colleagues show it to them, rather than a company prompting the first introduction. 

If a company's product prompts virality or the networking effect, that’s a sign it could be well-positioned to use PLG.

Zoom Video Communications, a software company, provides a great example of virality. Their product, Zoom, is a conferencing tool where users can send meetings links to people, allowing them to access a unique place to host their conversations. 

Often, a person’s first exposure to Zoom is through an invitation to meet with a current Zoom customer on their platform. By accepting a meeting, these non-customers get an opportunity to see a real-life demo of the product without engaging with sales or making any sort of commitment. When this experience exceeds their expectations, they’re more likely to not only purchase the product themselves but to also fully adopt it within their organization. The process then starts all over again when this new Zoom customer sends their first meeting invitation to a non-customer. 

This process is known as virality since it allows the product to spread from organization to organization just by using the tool as it’s intended to be used. 

Meanwhile, Slack, an instant messaging platform, provides a great example of the networking effect. In order to use the platform successfully, users need to invite others to chat with them. 

As more and more of your coworkers join that network and come to prefer the speed and convenience of the app, it becomes more efficient to communicate via Slack than with other channels like email. Again, use of the product garners adoption. 

Overall, PLG is a strategy to facilitate product usage. As users gain value from interacting with a product, they will weave it into the way they operate day-to-day. Once they adopt a product, the next logical step will be for them to make a purchase. After making a purchase and becoming regular users, customers naturally become evangelists, using the product and passing it along to their peers. 

Of course, to fully understand PLG, it’s important you grasp the concept of product marketing as well.

Learn how to put your product at the forefront of your acquisition, conversion  and expansion strategies with Your Guide to Mastering Product-Led Growth.

What is Product Marketing?

Product marketing is the process of bringing a specific product to market and ensuring that that product realizes continued success. 

A product marketer’s job entails guiding a product’s internal strategy. It is their duty to enable all of the marketing activities surrounding the product within their organization. While marketing is in charge of sales enablement, product marketers are in charge of “product enablement,” developing sales enablement materials for specific products. 

Here at New Breed, we believe that above all else the goal of your product should be to provide a solution to your customer’s problems. To find a solution, you need to understand the market your product is entering, asking yourself questions like, “what do people need?” and “what are people’s pain points?” 

When it comes to product development, if you provide value by solving people’s problems, you can create demand. By starting with a consumer challenge and working backward, you can determine your product positioning and develop your promise of value, also known as your unique value proposition. 

How Does PLG Fit into Product Marketing?

Product marketing is a high-level task. When you launch a product, you have to market that product — hence the purpose of product marketers. In essence, emphasizing product marketing within your company is emphasizing the continued improvement of your offering to lead customers to greater success.

PLG is much more specific. In your product marketing strategy, you may choose to leverage PLG as part of your business model. In this way, you can further emphasize your product, centering it at the forefront of your marketing strategy. 

Traditionally, you would generate sign-ups, product adoption and additional users through marketing and sales outreach. Now, you can leverage PLG to basically provide self-service sales, positioning your product as the main way that consumers sign-up for, adopt and use your offering.

Ultimately, PLG positions your product as the ends and the means, allowing users to try your solution and hoping they are so delighted that they make a purchase.

Key Takeaway

PLG emphasizes a similar mindset to inbound marketing, focusing on providing value before extracting value. It is a great way to create an exceptional customer experience with your product marketing efforts, relating everything you do back to your customer and accommodating their continued success. 

Ultimately, accommodating your customers’ continued success should be a core focus of your product marketing efforts no matter what, so incorporating PLG in some capacity is probably wise. Whether you have a full-blown PLG plan or not, demonstrating your product’s and company’s value to contacts before they are paying customers can aid your product adoption and education efforts.

If you want to hear more about all of the aspects of a complete PLG strategy, check out Your Guide to Mastering Product Led Growth.

Download your guide to mastering product-led growth

Isaac Desranleau

Isaac is an Inbound Specialist at New Breed. His passion for the inbound philosophy of giving value to customers before extracting it brought him to New Breed. In his free time, he's an avid outdoorsman.


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