What Does Product-Led Mean In Marketing?

DEFINITION
The term product-led in marketing is the inclusion of product-led growth principles in a company’s marketing strategy to achieve better acquisition, retention, and expansion. It prioritizes the product as the core of the overall marketing machinery.

💡Understanding Product-Led In Marketing

Traditional marketing involves spreading the word, generating sign-ups, adoption, and user expansion through various paid and organic channels like ads, events, and content marketing. 

Product-led growth (PLG), on the other hand, makes the product the star of the entire marketing effort, banking on the inherent value provided by it to create better retention rates and lower acquisition costs. 

Both traditional marketing and PLG have the same goal in mind—increasing adoption, expansion, retention, and value generation. They differ simply in the tools and channels employed for these purposes, resulting in the difference in time required to achieve the goals.

PLG and marketing don’t need to be two mutually exclusive strategies either. PLG promises to get better results if integrated properly. Product-qualified leads (PQLs) are just one of the many benefits of PLG that can prove to be indispensable for the marketing as well as the sales function.

While traditional marketing might track things like impressions and clicks, PLG brings with it more insightful metrics like Time to Value (TTV), expansion revenue, and net revenue churn. Product-led metrics perform the crucial task of arming you with the information you need to enhance both your product and the customer experience.

🖋 Takeaway

At its core, PLG in marketing is a reorientation of your marketing efforts toward solving problems for your customers and working toward your customers’ success. It brings down the barriers between the various departments in an organization by aligning them toward a common goal.

It works on the principle of adding value before generating value. You need to prove your product’s worth to prospective customers before expecting them to spend money on it. To do this, you can offer free trials or freemium models and help the users reach the ‘aha’ moment.

By placing the customers’ needs at the forefront and making your product your most important marketing and acquisition channel, you set yourself up for success in a crowded and hyper-competitive environment.

What Does Product-Led Mean In Marketing?

As an organization that has been operating without product-led principles, it might be tempting to just add PLG and its associated responsibilities to an already-overburdened marketing charter. 

But PLG does not work as a bolt-on, it needs to be built into your marketing DNA. 

What’s more, you don’t need to shift your entire strategy to PLG if you’re not ready yet or don’t require it.

However, the principles of PLG, when applied in your marketing make your end results like customer retention and acquisition costs better.

PLG, as a methodology, is a shift in perspective. This involves not just relooking at the outreach and awareness channels but also overhauling targets, KPIs, and metrics for all departments.

So, PLG in marketing can include

• Shifting your KPIs to customer-centric ones, like usage time, number of active users, net churn rate, and more.
• Making your organic content product-led, which means strategically placing your product features as the solution to your prospects’ problems.
• Focusing on customer feedback to improve the product.
• Getting the users to reach ‘aha moment’ as soon as possible.

Do You Need To Use Product-Led Marketing?

You can run marketing without necessarily integrating PLG strategies into it—your product might not align with PLG strategies or you might not be ready yet. But in the end, PLG principles translate to the best possible experience for the customer.

Apart from providing shared objectives to your entire team that hinges on product development and customer experience, PLG in marketing provides a host of benefits to your organization (and if you need it):

1. No time to scale: PQLs cut down the need for long sales cycles, accelerating expansion. If you’re looking to expand quickly without many bottlenecks, introducing PLG in your marketing strategies can help.

2. Minimal acquisition costs: With your product selling itself, you can reduce investment in sales teams and marketing overheads, reducing the customer acquisition cost (CAC).

3. Higher retention: As your customers are already sold on your product, they’re much more likely to stick around and generate greater value for your business.

4. First-party data: Access to first-party user data is a goldmine, especially with changing privacy policies. It presents an opportunity to enhance your product further catering to exactly what your customers like. 

How Does Being Product-Led Change Your Outlook On Marketing?

Incorporating product-led methodologies into your marketing efforts can change how your organization views the marketing function.

From focusing on how valuable your product is, your outreach efforts will shift to showcasing how it solves customer problems, instead of meeting a lead quota.

Instead of selling yourself to users, your marketing content will start engaging them in useful conversations about how they can extract deeper value from your product. Your events will shift focus from sales enablement to hands-on demonstrations.

On an overall level, each element of the customer experience like your website, customer support, and technical documentation will be optimized to serve your customers.