9. Key Questions About Acquisition Models - Insights and Answers

This document addresses common questions surrounding Product-Led Growth (PLG), Marketing-Led Growth, and Sales-Led Growth strategies, providing guidance on when and how to apply these models. By examining real-world applications, we explore best practices, challenges, and optimal conditions for implementing each model.

1. Can PLG Be Applied to Complex Products?

Yes, but it can be challenging. Product-Led Growth requires simplifying the product experience so users can engage with it easily, which can be difficult for complex products. However, there are effective approaches for adapting PLG to sophisticated tools.

For example, Pendo, a complex analytics platform, uses a PLG approach by offering a product tour. When users visit Pendo’s site, they can engage with a simulated version of the product. This tour, using fictional data, walks users through the platform’s core features and how it addresses specific pain points, without needing initial setup or real data integration.

This approach gives potential users an accessible introduction to the product’s capabilities. By demonstrating value in a low-risk environment, users gain confidence in the tool’s effectiveness, which can then motivate them to move forward with real data integration and eventual purchase.

This example from Pendo illustrates that while adopting PLG for complex products is more challenging, it is achievable with a well-designed product tour or interactive demo.

2. Does PLG Mean Sales are Fully Self-Service, Without a Sales Team?

Not necessarily. While PLG emphasizes product-led acquisition, many companies still rely on sales teams, especially as they scale. PLG does not inherently mean eliminating the sales team; rather, it complements sales by allowing users to self-educate and try the product independently.

For instance, Webflow, a platform often compared to WordPress, initially started as a self-service tool with free and paid versions. However, as they grew, they noticed that employees from major companies like Apple and Meta were using the platform on smaller, individual plans. Realizing they were missing revenue opportunities with these large organizations, Webflow implemented a sales team to convert these enterprise users to higher-value plans.

The result was a mixed approach: Webflow retained its PLG model for smaller users while also leveraging sales teams to handle larger accounts, maximizing growth and revenue. Studies from Clearbit indicate that PLG companies often add sales teams as they scale, especially when revenues reach significant levels. In fact, for PLG companies with over $100 million in revenue, all had dedicated sales teams to accelerate the process, particularly for high-ticket and enterprise-level accounts.

3. Can a Company Use Multiple Acquisition Models?

Yes, combining models is often beneficial. Many companies find value in using a combination of PLG, Marketing-Led Growth, and Sales-Led Growth. This multi-channel approach allows a company to optimize acquisition based on customer type, market maturity, and product complexity.

For example, RD Station successfully integrates both PLG and Marketing-Led strategies. They attract new users through marketing campaigns and content, then use their product as an entry point for smaller users through a PLG model with self-service onboarding and entry-level plans. Larger, enterprise-level customers can engage with a sales team for more customized solutions, demonstrating how RD Station blends models to reach a broader market effectively.

Each model targets different customer segments and parts of the journey, creating a well-rounded growth engine that encompasses acquisition, monetization, and retention.

Key Takeaways for Choosing the Right Growth Model

  1. Solve a Real Pain Point: A successful growth model starts with a strong product that genuinely solves a user’s problem. Ensure the product delivers value and aligns with market needs.

  2. Experiment and Understand Your Audience: Growth models should be tested based on the maturity of the market, product complexity, and the specific needs of the target audience. Continuous testing will refine the approach and optimize conversions.

  3. Focus Beyond Acquisition: Growth is not just about customer acquisition; it’s about the entire customer journey. Consider how each model supports not only acquisition but also retention, monetization, and expansion.

By understanding these growth models and strategically combining them based on business goals, market maturity, and customer needs, companies can create a tailored growth engine that drives sustainable success.