6 myths about product-led growth (PLG) that SaaS founders need to be aware

Every SaaS founder wants to build a company that runs like a dream. It’s one of the reasons why a sizable number of SaaS brands nowadays lean on product-led growth (PLG)—hoping that it would automate a lot of their go-to-market (GTM) headaches or earn them viral growth.

But believing that PLG is the only viable growth strategy is as dangerous a thinking as the “if you build it, they will come” fallacy. PLG, after all, isn’t a field of dreams that can bypass the market dynamic of growing a SaaS business in the real world.

PLG is certainly a force to reckon with—but it’s not an all-or-nothing choice for growing your business. In this post, we have curated a list of six common myths about product-led growth. If you are thinking of leveraging your product at the core of your GTM motion, you must be aware of them.

Myth #1: PLG is the most popular go-to-market motion

Of late, PLG has become as viral a concept as the brands that it has elevated to the top. Over the last few years, the term “product led growth” has garnered quite a lot of intrigue in the public sphere.

The concept is now so popular that it has spawned a multitude of other jargons like “product led growth funnel,” “product led growth flywheel,” “product-led onboarding,” or “product led storytelling.”

If you look around in the SaaS universe, it might seem like almost every product company is behind the PLG bandwagon. However, it’s not necessarily the case if you scratch the surface more deeply.

While PLG is “the new kid on the block” that has everyone’s attention, it’s far from being the most dominant GTM motion. The majority of SaaS brands still offer the traditional sales-led customer experience—maybe with some amount of PLG strategy peppered in their go-to-market motion.

This is also true when you go granular into niche software categories in SaaS. For instance, Avoma operates in the conversation intelligence niche and offers its customers a choice between a PLG motion and a sales-assisted motion—based on how they want their buying experience to be.

Other players in the conversation intelligence domain have an 80-20 split between PLG and other GTM strategies—i.e. 80% of SaaS companies offer a sales-driven customer experience while less than 20% of companies bank on product-led go-to-market strategy.

Take for example Gong or Chorus—two of the heavy hitters in the conversation intelligence space who don’t even have their pricing information public, let alone offer a free trial. But despite their sales-driven GTM strategies, both brands are doing exceptionally well in growing their brand. Clearly, PLG is not the only knight in the shining armor when it comes to growing your SaaS business into a Unicorn.

Companies that have employed PLG as their go-to growth strategy have yielded clear advantages out of it, as demonstrated by industry findings such as OpenView's Product Led Growth Market Map or Clearbit’s The Anatomy of PLG SaaS. But banking on such findings to say that PLG is the driving force in SaaS is nothing but a recency bias fueled by selective data sampling.

Myth #2: PLG brands don’t need marketing

It’s one of the biggest myths to assume that PLG can succeed on its own without any push from marketing. Most people think that PLG is limited to being a powerful customer acquisition channel, which is why they falsely believe that PLG can offset the need for marketing.

But here’s the thing—if you break down the product-led strategy to understand it better, there are basically two main outcomes to applying it in your business:

• Acquisition
• Conversions

Acquisition is how people become aware of your brand, visit your website, sign up with your product, or become a part of the micro-conversions even before they become your paid customers. 

Conversions happen when users start interacting with your product, engage with it more meaningfully, start trialing your subscription plans, and ultimately make purchase decisions down the funnel.

There are very few products that have the luxury of being 100% product-led by virtue of being viral in nature. 

But even the most successful products that grew exponentially out of their PLG strategy need some leg up from marketing and sales at least during its nascent growth phase. 

Case in point—Loom. Loom is a quintessential product-led company. 

The brand has built-in virality embedded in its product because it’s as utilitarian as a video sharing platform can get and the product requires new users to sign-up with Loom in order to access its offerings.

But even Loom banked heavily on marketing to get its name out during its early days. 

Nobody had even heard about Loom when they launched in early 2016, i.e. until they launched on Product Hunt on 30 June 2016. The Product Hunt launch changed everything for Loom and transformed it from being a no-name indie brand to being a cool app everybody wanted to get their hands on.

Loom acquired 10,000 users just out of its launch on Product Hunt. The campaign also helped Loom create a brand awareness at scale which would have otherwise taken years for it to build had it banked solely on its product-led strategy.

The point is that even the most viral brands need some initial help from marketing to earn the initial mindshare among their target market. PLG is usually a flywheel layer that needs marketing to initiate its momentum. Once the flywheel gains good momentum, the PLG strategy kicks in and the brand starts seeing exponential growth depending on the virality component in that product. 

But having a PLG-first strategy doesn’t mean that you should get rid of your marketing functions entirely.

Marketing is not just about acquiring customers—it’s also about communicating your brand positioning and attracting the right customers to your brand. 

In Loom’s case, its Product Hunt launch helped the brand communicate what the product did, what was the status quo it fought against, and how people using mediocre tools to solve their pain points now had a better alternative.

Myth #3: PLG brands don’t need sales

If a good product sold itself—companies like ScaleFactor, Transpose, and Fast wouldn’t have ceased to exist today. This is not to say that these companies failed because of a lack of good sales strategy, but to say that success born out of the PLG strategy can be highly contextual.

Granted, some companies have unlocked unprecedented growth because they exclusively took the PLG route. Slack is one of the most well-known Saas brands that has made out an example of how to succeed with a dominant PLG strategy. Even they invested in building a strong sales team as their product started to mature, to convert accounts and users that reached a minimum platform usage threshold.

On the contrary, Ahrefs is a company that boasts of product-driven, marketing-led growth with zero salespeople. However, these are outlier examples that are hard to replicate. If you want to replicate their PLG success, you better have a B2C-like product that solves individual use cases.

That's because PLG is an amazing lever of growth for brands whose products cater to single-utility functions. Take for example apps such as Evernote, Grammarly, or Canva. These are software that users use to fulfill individual problems like productivity and self-improvement. There’s not much scope for sales to sell such products because it would incur huge costs to employ a salesperson (or a team) to convert just one buyer.

Sales becomes a game-changer the moment you have a product that inherently has a multiplayer element to it, i.e., when the product is used by a team or across functions in an organization. 

For example, apps that require two or more people to collaborate together such as software in the realm of project management, marketing automation, or CRM benefit greatly when there’s a sales team in the background.

The role of sales becomes even more crucial if the product solves multiple use cases, such as a project management tool. That’s because there’s an expansion opportunity for horizontal products that solve multiple use cases.

In such scenarios, the sales team can leverage a single user or team as their “foot in the door” to penetrate an account and communicate their product’s value to other relevant buyers within the same account. 

This strategy lowers the customer acquisition costs and stretches your revenue potential by allowing you to tap into adjacent buyers who couldn’t have discovered the product without sales reaching out to them.

Even in situations where product-led strategy is the primary champion of growth, sales can add value by helping customers who are stuck in their self-discovery journey to understand the product better. Therefore, it’s better to see sales as a complementary force to a PLG strategy rather than looking at it as a disposable business function even when you have a great product.

Myth #4: Today’s buyers seek a complete self-serve product experience

Personally, I wish this wasn’t a myth but an actual trend because it would help so many brands cut overhead costs. Unfortunately, it’s an anecdotal trend that doesn’t hold weight—at least not yet.

It’s not entirely wrong though: there’s some truth to the assumption that consumers today want a fully automated, self-service product experience. Most buyers don’t want people breathing down their backs. It’s like you are being stalked by a store clerk around the grocery store when you are in the mood to shop at your own pace. Nobody likes that.

Be it in corner stores or B2B domain, consumers want to do their own research and figure things out on their own before they come to the checkout counter, i.e. the sales desk. They prefer a smooth self-serve buying experience for the first leg of their customer journey like researching a product, comparing it with alternative brands, forming their opinion about it, etc. 

A product-led buying experience journey until that point is perfect.

But it becomes complicated when customers are stuck in their product discovery journey and want to talk to someone for answers. It’s like asking a store clerk for help when you can't find a particular brand of noodles or chips when you are in the grocery store.

No matter how mature your product-led motion is, it’s a lost opportunity to not have sales on standby when customers expect you to help them with their queries regarding your product. Therefore, it’s good to have sales as a springboard for a better buying experience even when PLG is your primary GTM strategy.

There’s another variation to this myth which claims that PLG is good only for small business customers. Again, it’s an invalid assumption because it’s wrong to devise your growth strategy by the company size or industry. Instead, your GTM strategy should be buyer-centric or centered around the core use cases that your product solves for.

We can tell you from our first-hand experience at Avoma that a lot of SMB customers crave a sales assistive touch and schedule demo calls even when they have a fully self-service product experience. 

It’s precisely why we at Avoma offer a product-led and sales-assisted GTM motion.

There’s no denying that buyers today have access to a wealth of information right at their fingertips. But that doesn’t completely discount the need for sales. 

In reality, this trend has made the role of sales even more critical because customers now want to talk to sales to validate their research, challenge their assumptions, or gain newer perspectives. In recent years, the role of sales has dramatically shifted from being suave solicitors to facilitators of useful information—like a consultant or an advisor.

The majority of consumers today have the problem of plenty—they have so many tools to evaluate and so little time. It’s tiring for buyers to trial each and every software they come across and try to figure out everything on their own.

Most buyers prefer to shorten the buying cycle by doing preliminary research and reaching out to sales to ask them hard questions. Many B2B buyers reserve the option of trialing a product for free only after they talk to the sales team as part of their product research.

Myth #5: PLG is solely the product team’s responsibility

This myth piggybacks on the previous two myths because if there is no need for marketing and sales in the perfect world of PLG, the responsibility for driving the PLG strategy automatically falls in the lap of the product team.

But for the PLG strategy to succeed, you need a smooth alignment across the product team and all other functions that contribute directly to growth. PLG is a true-blue cross-functional initiative which really starts with the CEO helming it as a collective GTM function.

It could be that the “product” in the PLG strategy fools people into thinking that it’s the product team’s liability to see it through. The truth is, there are very few GTM initiatives that are as all-encompassing as the PLG strategy.

If you think about it, the PLG strategy is one area where your business is forced to truly think about the entire lifecycle experience of the customers. 

Starting from how to create brand awareness among the first-time customers, should you offer a free trial, how and where to position your sales touch across the conversion funnel, and what signals to read in order to filter potential buyers with big revenue opportunities from the rest.

When a growth motion is so holistic that cuts across the board, you can’t afford to have just one team shoulder the entire burden by themselves. 

Without a doubt, PLG is a composite initiative between all teams who all play their individual part in making it succeed. For instance, here’s what each function contributes to PLG’s success:

• CEO/leadership: Strategy & vision
• Product: Ideation & execution
• Engineering: Product design & iteration
• Marketing: Product awareness & education
• Sales: Contextual assistance & friction removal
• Customer success: Onboarding, retention & expansion

With each function, you have the opportunity to tweak your PLG strategy in a way that improves your customer experience. For instance, you can decide to employ customer success managers to offer an old-school concierge experience or productize the whole onboarding journey as part of the self-service product experience. It’s best if you have a combination of both the experiences.

But taking them away entirely from your PLG strategy and the whole thing can come tumbling down like a house of cards.

Myth #6: Product-led growth is not meant for enterprises

Like we discussed a little bit earlier, a common misconception about PLG is that it’s suitable only for SMBs. The extended argument is that PLG is a no-good GTM strategy for mid-market or enterprise businesses; it doesn't work for them as well as account-based marketing and sales. 

And that’s a massive misconception that makes rounds in SaaS circles.

It’s certainly true that the majority of enterprise companies have a sales-driven motion because enterprise sales, in general, is like running a political campaign.

Big-ticket customers often have buying committees and a long-winding culture to interact with sales at length before procuring a new software. 

The buying process in the enterprise domain is full of friction because of the different levels of security reviews, compliance checks, and procurement bureaucracy that vendors have to go through before closing a deal.

However, there are exceptions to this rule and PLG is emerging as a viable alternative in enterprise sales. 

Take for example companies like Atlassian, Twilio, Snowflake, or AWS—all multi-million-dollar revenue earning companies in the enterprise realm. These companies have perfected a GTM motion where their product, pricing, and sales model work in tandem to convert leads to seven-figure deals through smart usage of product-led growth principles.

For example, enterprises are institutionalizing Shadow IT (products that individuals or teams use without the IT department’s approval) because individual users and small teams within enterprises behave exactly like SMBS—they buy apps that are outside their IT team’s radar to optimize their efficiency. Shadow IT is enabling PLG companies to grow their footprint among the otherwise conservative enterprise customers.

Product-led brands leverage free trials and freemium offerings to attract enterprise buyers as their first level of acquisition to land and expand into big enterprise accounts. Once they get their foot in the door, they fall back on the traditional sales strategies to identify new acquisition opportunities and employ customer success to upsell and cross-sell their offerings.

Hypothetically speaking, most product-based mid-market and enterprise clients can choose PLG as their preferred GTM motion, but that’s a completely subjective call for them to make. 

Big companies have nothing to lose if they take the PLG route without compromising on their traditional sales and marketing approach. 

Choosing PLG as an alternative growth motion can actually force mid-marketing and enterprise brands to make their product more intuitive, simplify their marketing communications, improve their gross margins, and accelerate their overall growth.

By norm, most enterprise vendors are used to throwing people and resources at problems stalling their growth. For instance, they might hire more implementation experts to streamline their product adoption if their customers start complaining about the technical difficulties in implementing a software program. 

It’s not always an optimal solution because it adds more manual processes to the mix and makes enterprises burn through their cash.

Alternatively, if they train their engineers to build easy-to-use products that have little to no learning curve—enterprise vendors don’t have to hire technical experts or over-complicate the customer experience.

Ditch the myths, do what’s best for you

It’s worth reminding that PLG is not an antonym to traditional GTM functions like sales or marketing. Instead, they are complementary forces that can create synergy when you put them together.

At the end of the day, each GTM function aims to improve customer experience and ease their buying decision. No matter what growth motion you choose, you will have to layer one motion with another at one point or another.

Yes, you can decide to tilt heavily towards one motion as your primary growth channel. But it’s not good to over-attach yourself to a single growth channel. 

If you can look at a product as an enabler in a customer's self-discovery process, you can leverage PLG to automate certain parts of the customer journey to improve CX. 

But instead of looking at PLG vs marketing or sales as an either-or option, apply them at different stages of your growth funnel to yield better business outcomes.