2 mental models for adding PLG to your sales-led product

Unpacking the "why" and understanding what to optimize for

Adding a Product-Led Growth motion to an existing sales-led company, especially one focused on higher-tier market segments (Enterprise, Mid-Market), should always begin with "why."

PLG isn't just a rigid framework with a specific set of steps; it's a flexible system adaptable to your unique needs. Implementing it all at once isn't feasible or reasonable, as there's no universal "silver-bullet recipe" for every product and company. Instead, you need to act, learn, and iterate to see if your ideas move the needle.

But what "needle"? If you don't understand how PLG benefits your business, how will you measure its success? How will you know what works and what doesn't? PLG isn't a "one-and-done" system; it's a dynamic process which adapts to evolving goals.

Yet, many still perceive PLG as merely a tactic. When I discuss PLG with curious founders, I start by helping them unpack what it truly means for their context. What exactly do they hope to achieve? What is their most pressing pain point, and why now?

I’ve frequently observed a lack of clarity. Founders often voice frustration with investing big dollars in acquisition that doesn't yield sustainable revenue growth, failing to offset churn or significantly improve customer expansion. Or, leaders tasked with "building PLG" may lack full company context. They might initially believe PLG will strengthen their market presence, only to later realize its intended purpose (by execs) is to cut costs and scale more efficiently.

This confusion often stems from a general misunderstanding of "growth" itself, still misinterpreted by founders, marketers, product professionals, and sales teams alike. I talked about this in my previous article “Unpacking B2B Product Growth”.

Below, I propose two mental models to understand why to add PLG to your sales motion (struggling or successful):

Approach 1: Fix What’s Broken

This is, in my opinion, the most common scenario, especially for products that have been 5+ years in the business.

It’s a frequent case for companies that prioritize sales over product. And there are a lot of them. As my boss (a CFO) once told me, "Alex, in Germany, if you're running a B2B SaaS business, the most important thing is to have a sales pipeline. The rest is a nice-to-have".

This mindset often leads companies to pursue the widest possible customer segments, often forcing them into cabal contracts, and prioritizing sales requests to drive short-term revenue (and sales🤷‍♀️) goals, and leaving product and customer experience to chance. This results in poor engagement, churn, customer dissatisfaction, and missed expansion opportunities.

The product org becomes a feature factory with diminished motivation and alignment, being a service organization to business teams who often lack empathy for customers and dismiss behavioral data.

This dynamic transforms the product into a leaky bucket of customers and revenue. Sales cycles lengthen and become more expensive, while willingness-to-pay lowers. This is where PLG curiosity starts, believing that it will save them by lowering CAC. 3xhaha.

The reality is, these companies have a retention problem, not an acquisition one.

Moreover, market competition is continuously increasing, even if the overall market size isn't necessarily expanding. New entrants often target easier-to-capture SMB and prosumer segments, building strong products for end-users and establishing mechanisms to convert them into customers and help them evolve into high-spend accounts. Over time, these newcomers expand their presence and brand, leading your existing customers to question if they can achieve the same results with a typically cheaper new product.

So not only does acquiring new customers become harder, but if your switching costs aren't very high, your existing customers will likely leave. This isn't just about price — it's often because competitors' products simply offer a better experience for your customers' employees.

In this situation, Product-Led Growth is about building a strong foundational product, not just polished homepages. It's about providing a clear, coherent, and engaging user experience that makes customers want to stay, even if switching costs are low.

A self-serve product delivers real users, data, and continuous feedback, leading to a clear understanding of what works and what doesn't. Budget-conscious customers are unforgiving: they won't accept "your feature request was added to the backlog 14 months ago, stay tuned!".

The comforting fact is that you don't need to implement the entire PLG motion to achieve this. You can apply specific tactics, such as self-serve activation and purchasing, allowing your product team to fix retention leaks instead of merely cramming their backlog with new features (more likely unpolished MVPs).

Free or small-budget users can help you develop a product that your higher-tier customers will love. In fact, with time, these users can evolve into higher-budget accounts if you support their growth.

This approach helps you defend your existing market by making your product compelling enough for your customers to stay. We can call this the Defense mode.

When the biggest leaks are plugged, the company can move into the Offense mode (read below). Or not, if they wish to continue to grow through sales and other strategies.

TL;DR:

The Defense mode of adding Product-Led Growth is about protecting your existing market from customer and revenue leaks and competitors encroaching from "the bottom". This can be addressed by applying product-led tactics to fix leaks and expand your customer base.

Approach 2: Fuel What’s Working

If your sales-driven product already demonstrates strong engagement indicators, promising retention and upsell signals, then consider creating a full Product-Led Growth motion to drive self-serve customer acquisition, retention, and monetization, and enjoy the scalability and predictability perks.

In this scenario, your crucial task is to identify a meaningful, often heavily reduced, version of your product that can deliver and sell its value to customers without human intervention. This is a prerequisite, as it's challenging for a product that isn't easily and quickly understood to sell itself. Don’t cram all of your features into the self-serve product — only most important for attracting and serving lower-tier customer segments with less complex use cases. Your other features, as much as they're dear to your heart, can be introduced as customers grow in size, complexity, and the variety of their use cases.

Of course, this isn't always possible. For instance, I spoke with the founder of a data product whose core value could only be realized with large organizational datasets. This product simply didn't make sense for smaller customers. While they could use some product-led tactics to improve product engagement and customer expansion, PLG as a concept for serving smaller organizations wasn't suitable for them.

I've found that this Offense mode is more applicable for products that have recently achieved strong PMF indicators. In this case, Product-Led Growth serves as a PMF expansion strategy, helping businesses decrease costs, reduce risks, and improve revenue predictability and market presence. This approach leads to a more comprehensive growth strategy for building a self-sustaining and efficient motion, requiring a more strategic approach to where to start, what to learn, and how to proceed.

TL;DR:

The Offense mode of adding Product-Led Growth is a way for already rather strong products (as per acquisition, retention, and conversions/monetization signals) to win new markets and expand & strengthen their PMF.

The PLG Spectrum

I want to reiterate that PLG is not a binary "yes" or "no" system. Everyone can benefit from it to some degree. This fact is almost entirely overlooked — even when founders no longer believe PLG is just "viral acquisition," they still tend to think of it as 0% or 100%.

In reality, it's a spectrum, and the 0-100% scale applies more specifically to the degree of human support involved. If we consider the most common formula for "Growth," we can visualize it like this:

Here, each growth lever (Acquisition, Activation, Engagement, Monetization) can involve a varying degree of human support, from 0% to 100%.

This makes the growth spectrum look something like this:

This means there are various combinations and approaches.

Your acquisition might be entirely product-led, entirely sales-led, or a combination of both in various proportions.

The same applies to Activation. When I led the analytics SaaS (a complex product by definition), it was clear that some users had the technical ability to onboard themselves, while others did not and required human support, especially with setup. Both were viable first account users within our ICP. Thus, our activation wasn't entirely product-led, although we certainly aimed to minimize Customer Success involvement for lower-tier accounts and scale human onboarding through recurring group webinars, onboarding videos, and so on.

TL;DR:

With PLG, you actually have a choice in how you add it to your business. It is highly contextual to the product and business stage, the product itself, the market.

The main takeaway is that you don't need to pursue "pure," full-blown PLG to be product-led. However, being product-led to some degree is no longer optional. In this era of abundant competition (and stagnant market size and willingness-to-pay), you need at least a great product to remain competitive.