Core Elements of PLG Infra
When we mention Product-led growth, we often refer to user acquisition, activation, engagement, monetization, and product-led sales strategies. Companies are constantly building growth loops and hacks around these pillars to significantly grow business metrics along the user/customer journey.
At the same time, we don’t talk enough about building a growth platform that provides sustainable mechanisms to drive these growth levers. The growth platform enables the whole company to drive PLG strategies, not just the growth team. So, what are some core elements of a growth platform?
I went and talked to more than ten growth leaders from companies like Figma, Gusto, Wealthfront, Asana, etc. While there were some variations in how each company approached the growth platform, they all had common elements. These elements were either built in-house or operationalized through a third-party tool.
Event Tracking and Product Analytics: This is an obvious one and has been around for more than a decade. Growth teams are now responsible for owning event tracking and product analytics platforms. These are typically acquired through external tools like Amplitude, Mixpanel, or HotJar. This layer helps companies measure the outcome of their initiatives across the product and growth teams. Top PLG companies are sophisticated in using these tools. They are documenting every event that’s tracked and thus keeping a high level of data integrity. At Sentry, we were in Amplitude multiple times a day. In fact, we used them as a platform to measure the outcomes of our AB experimentation as well.
Experimentation: Growth teams are constantly running experiments to optimize conversions and adoption. An experimentation platform is a must-have for that. We, at Sentry, used a legacy open-source platform - PlanOut. However, that had its limitations in measuring outcomes and running deeper experimentation. Most leading PLG companies have either built a base experimentation platform in-house or are using LaunchDarkly or Statsig. A new sophisticated trend in the experimentation field is to auto-converge experiments based on developing outcomes rather than manually monitoring outcomes and adjusting the audience. This saves a ton of time. This is useful when you have more than 2 variants running and have slight variations. A big pain point for PLG teams is that there is no standard way of recording outcomes from these experiments. The newer experimentation startups are Eppo and GrowthBook.
Notification / Communication Platform: Every growth team owns the capability to communicate with their users inside and outside the app. I have seen advanced PLG companies build in-app communication mechanisms. Their primary concern with using external tools is the application's performance. Injecting a third-party Javascript adds a delay to the front-end application performance. We saw that as a big challenge to using the external in-app notifications platform at Sentry. The argument on the other side is effective RoI and saves engineering time. We eventually moved to Pendo. Some of the upcoming tools in the space are Userflow and Dopt. Many companies use a common communication platform for email, slack, and in-app notifications. Tools like Iterable and customer.io are enabling that for the PLG and marketing teams
Customer Profiles and Segmentation: The best PLG companies constantly try to target a specific segment of users with their behavior-specific touchpoints. This helps drive better conversions and adoption as well as serve more relevant experiences for the end users. Companies typically try to bring together user behavior data, sales data, marketing automation data, and customer account data to be able to create segments on them. The practice in many companies is called Account 360. A place for Sentry was the Signup onboarding flow. We noticed that a group of signups was coming from Engineering Managers (While Developers were our primary persona). So, we surfaced an option to invite team members for them as part of the onboarding flow. In an ideal world, I wanted to build growth touchpoints across a user journey based on their segmentation. However, our implementation wasn’t as sophisticated. The other challenge was that we didn’t have a single definition of our segments across the company. I am curious if others have used a better approach to segmenting their users.
Promotions / Incentive Platform: Many SaaS companies are getting closer to direct-to-consumer companies and exploring promotions platforms as core parts of their stack to drive upgrades, feature adoption, or acquisition. These incentives typically take the shape of:
- Promo codes to drive signups through webinars and field events
- Incentives to drive users to annual plans
- Action-based promotions to drive specific action/engagement in the application
SaaS companies typically build this solution in-house and connect it to their subscription/billing platform. However, the platform constantly runs into challenges with what's possible, how to segment these promotions for specific user groups, and how to measure the effectiveness of the incentives. There’s obviously a larger debate about whether promotions are effective for SaaS customers at all.
Onboarding: Onboarding takes many shapes while building product experience to drive conversions. The term is commonly used for Signup onboarding to drive activation. Onboarding is much more than that. There should be Onboarding steps to every part of your customer ladder. These include:
- Signup onboarding
- Free Trial onboarding
- Onboarding every paid tier
- Feature onboarding
A core PLG fundamental must be about helping users through your product in a self-serve approach. Products often think their job is done if a customer has upgraded or set up a feature or activated the product. The journey and touchpoints need to be continuous and flexible. Hence, it is important to have a common platform to drive onboarding across different stages of a customer journey.
Content System: More and more PLG companies are curating in-app and email messaging for a specific segment of users. These include content on:
- Feature pages
- Onboarding steps
- Modals and Banners
- Key CTAs
Changing content at these places typically means going through product roadmap and engineering to get this updated. Hence, long execution cycles. The PLG function brings together Product, engineering, marketing, and sales. So, companies like Wealthfront have built an in-house content system that allows marketing teams to update in-app content on the fly. Asana and Figma have played around with the approach as well.
Free Trial and Upgrade Experience: It is very common for the growth team to own the upgrade experience. In many cases, PLG companies are trying to acquire customers through the Free route and showing them value to the paid plans in hopes of converting. There’s more on the Free Trial / Reverse Trial strategy here. There are a few tools at hand to drive upgrades:
- Free / Reverse Trial
- Cross-selling in the app and through other communication channels
I am curious to hear if you think there are other core parts of a growth platform and how they impact growth strategies.