Introduction

Unless you’ve been living under a rock (in which case, more power to you), you’ve likely heard of sales-led growth (SLG) and product-led growth (PLG). What you might not know is that PLG companies grow 20 to 30% faster on average due to lower customer acquisition costs and faster user adoption, while SLG companies can achieve 20% higher customer engagement rates and better outcomes in terms of customer outcomes and deal closures, making it a go-to strategy for enterprise-focused businesses.

But which strategy is the right fit for your business? That’s the multi-million-dollar question — and in this article, our goal is to help you find the answer. 

Understanding Sales-Led Growth

Sales-led growth, also referred to as sales-driven growth, focuses on direct sales efforts and human interactions to drive customer acquisition and revenue growth. It’s all about leading with value and positioning yourself as a trusted partner, rather than a rep chasing a quota. SLG prioritizes educating prospects and delivering solutions that address their biggest challenges, rather than trying to sell them on flashy new features.

Key characteristics of SLG include: 

• Personalized outreach: Rather than sending out a swath of one-size-fits all emails in the hopes of getting a few responses, SLG focuses on outreach that’s customized to the individual stakeholder or account. Sales teams invest time in researching the prospect’s business needs, challenges, and goals, which allows them to craft messages that resonate on a personal level. 
• Relationship building: One of the primary goals of sales led growth is to build long-term, trust-based relationships with customers and prospects. This happens by consistently providing value, offering personalized solutions based on a prospect’s pain points, and being a trusted advisor through the entire process. 
• High-touch sales processes: During the SLG process, there are multiple, ongoing interactions between a rep and prospect. This is to ensure the prospect’s needs are fully understood, their concerns are addressed, and the solution considers all aspects of their needs. 
• Consultative selling: In SLG, a rep partners with their prospect to act as a trusted advisor and provide solutions that drive real, measurable results. 
• Longer sales cycles: SLG prospects tend to be more complex, larger organizations. As such, the sales cycles are longer and typically involve multiple decision makers.  

In sales-led growth, reps aren’t just focused on closing deals or signing new logos. They’re dedicated to becoming an integral part of the prospect’s decision making process, ensuring prospects are well-informed and able to make the best choice for their organization — even if that means selecting a different solution.

The Fundamentals of Product-Led Growth

In product-led growth (PLG), the product itself is the primary driver of customer acquisition, conversion, and expansion. The focus of PLG is to create an intuitive and valuable user experience where users can explore the product's capabilities firsthand. 

In this model, users typically gain access to all or part of the product for a set period of time. However, some companies also offer access to a basic level of the product for one user indefinitely, hoping that over time, the user will choose to upgrade. The goal is to allow PLG users to experience the product’s value before making a purchasing decision.

By engaging with the product early, users are empowered to self-educate, make informed decisions, and see how (or if) the solution can address their specific challenges — all without relying heavily on sales teams.

Successful examples of PLG include: 

• Zoom: Zoom is a video conferencing tool designed for virtual meetings and webinars. Its freemium model includes access to its core features, including one-on-one calls and group meetings with a 40-minute time limit. This allows users to experience Zoom prior to purchasing it. As organizations expand and require larger, longer meetings or advanced features such as webinar hosting, they’ll need to upgrade to Zoom’s paid offerings. 
• Hootsuite: Hootsuite is a social media management platform that allows businesses to schedule and manage social posts across various platforms including LinkedIn, X, Instagram, Facebook, and Pinterest. The company offers a freemium plan that includes basic tools for scheduling posts and managing up to two social media accounts simultaneously. As organizations scale and need access to more platforms at once, or advanced features such as analytics and bulk scheduling, they’ll need to upgrade to Hootsuite’s paid offerings. 
• Canva: Canva is an easy-to-use design platform that allows users to create professional-quality graphics, presentations, and other designs. It offers a free version with access to basic design tools and templates. For more advanced features like business branding, collaboration with other users, and access to premium templates, users will need to upgrade to one of Canva’s paid plans. 
• Dropbox: Dropbox is a cloud storage service that simplifies file sharing and collaboration. Its freemium model gives users 2 GB of free storage indefinitely. This enables them to share files, photos, and documents with others. As storage needs increase, or for access to more advanced features like file recovery and collaboration, users will need to upgrade to one of Dropbox’s paid offerings. 
• Slack: Slack is a cloud-based platform designed to streamline team communication and improve productivity. It offers a freemium model, allowing teams to use core features like direct messaging and channels for free indefinitely. Many organizations start with Slack's free version and later upgrade to paid plans as their teams grow and require more advanced features.

The "try before you buy" approach of freemium models lowers the barrier to entry and encourages wide adoption. It also incentivizes users to upgrade once they encounter limitations in the free version, as seen with Zoom’s meeting time limits or Dropbox’s storage cap. In-product onboarding, like that in Slack and Canva, helps users maximize the value of the tools from the start by guiding them through essential tasks, highlighting key features, and making the product easy to understand and use.

Another important aspect of PLG is viral loops, which are mechanisms that encourage users to invite others to the platform, fueling organic growth. For instance, in Dropbox, users share files with others, who then sign up to access or collaborate on those files, driving additional user acquisition. Viral loops create a self-reinforcing cycle that enables PLG companies to grow exponentially, often without the need for heavy marketing or sales efforts.

Comparing Sales Led and Product-Led Growth

To recap what we discussed above: SLG focuses on direct sales efforts and building personal relationships, whereas PLG revolves entirely around the product. SLG is a rep-heavy, hands-on approach that often requires significant resource allocation to expand sales teams and customer success roles, as acquisition relies heavily on human interaction. In contrast, PLG enables customers to experience the product firsthand through freemium models or free trials, making it a self-service acquisition model.

Let’s compare these two sales options in more detail:

PLG:

• Shorter sales cycle: Because users can experience the product firsthand, they can make quicker purchasing decisions without the need for prolonged interactions with sales teams. This speeds up the time from initial interest to conversion, making it easier to scale rapidly.
• Independent product exploration: Users can evaluate the product on their own terms, which empowers them to discover its value at their own pace. This self-guided exploration often leads to quicker adoption without external pressure.
• In-product onboarding: Seamless onboarding guides users through the product's features, ensuring they get value from day one. This reduces the need for heavy sales or support involvement, allowing customers to get comfortable with the product independently.
• Low customer acquisition costs: Since the product itself drives user acquisition, there’s less reliance on expensive sales and marketing efforts. This leads to lower customer acquisition costs, allowing companies to scale more efficiently.
• Product generally sells itself: With PLG, the product acts as its own rep, drawing users in through its functionality and ease of use. This reduces the need for large sales teams and allows businesses to focus resources on improving the product itself.

SLG:

• Longer sales cycles: The SLG process typically involves multiple interactions with reps, demos, and negotiations, which can take time. This is especially common for larger, more complex deals where human input is crucial for customization and long-term relationship building.
• Requires manual sales efforts: There’s no such thing as “one-and-done communication” in SLG. Instead, reps need to be involved throughout the entire process — answering questions, addressing concerns, and building trust. This hands-on approach can be resource-intensive but is key for securing high-value contracts.
• Scaling requires hiring and training more reps: As companies grow, scaling an SLG model involves investing in additional salespeople to handle the increased volume of prospects. This can slow down scalability and increase operational costs, as each new rep requires time and resources for onboarding and training.
• Results in larger deal sizes and longer customer lifetime value: The personalized attention and trust built through human interactions often lead to larger deals and higher long-term commitment from customers. SLG typically yields higher revenue per customer over time, making the investment in sales teams worthwhile.
• Customers receive personalized, human interactions throughout their journey: In SLG, sales reps provide ongoing support and personalized recommendations, creating a deeper connection with customers. This personalized approach not only strengthens relationships but also enhances retention, as customers feel valued and understood.

Ultimately, both of these models offer unique advantages. SLG delivers high-touch, relationship-driven growth with larger deal sizes but requires more time and resources to scale. PLG, on the other hand, offers rapid, organic growth with lower acquisition costs but relies heavily on the product’s ability to continually deliver value.

Advantages of Sales-Led Growth

Sales-led growth excels at building strong, personalized customer relationships. Instead of relying exclusively on a software solution, customers engage with actual human beings who take the time to understand their biggest challenges, needs, and develop personalized rapport. 

This rapport is especially critical when dealing with complex sales cycles and larger enterprise accounts, where the stakes are higher and decision making involves multiple stakeholders. Consistent, human interaction enables reps to build trust with decision makers, and navigate longer sales processes effectively. 

One of the biggest benefits of SLG is that reps can tailor solutions and pricing to fit each customer's unique needs. Reps work closely with prospects to understand their challenges and then customize the offerings accordingly. This approach, also known as value selling, allows for flexible pricing structures based on customer priorities. By focusing on solving specific pain points, SLG reps can create highly relevant, customer-centric solutions, which often result in larger deal sizes and higher lifetime value.

Benefits of Product-Led Growth

By centering the product around the user's needs, companies create intuitive, easy-to-use solutions that solve real-world problems. This focus on user experience drives natural adoption and retention, as the product seamlessly integrates into the customer’s workflow. Plus, marketing efforts can be embedded directly within the product itself, through features like in-product prompts or invitations, enhancing the customer journey without the need for heavy external campaigns.

PLG also promotes higher user engagement. Since users are onboarded directly in the product, they quickly become proficient and can easily see how it addresses their specific needs. This builds trust in the product’s effectiveness and reinforces its ability to deliver real value.

One of the best parts of PLG is that satisfied users are likely to share their positive experiences and recommend the product to others in their network. This leads to organic, word-of-mouth growth. This natural, user-driven expansion enables PLG companies to achieve exponential growth over time, as seen with successful PLG companies like Slack and Canva — each of which is now valued at over $26 billion, respectively. 

Choosing the Right Growth Strategy

Ultimately, whether you choose to move forward with a sales-led growth approach, a product-led growth model, or a combination of both, several key factors will influence your decision. It’s important to consider the complexity of your product, the characteristics of your target market, customer preferences, and your organization’s overall readiness to implement the chosen strategy.

To help guide your decision, here are 5 questions to ask yourself to determine which growth strategy makes the most sense for your business:

1. How complex is your product? If your product requires a lot of explanation, customization, or guidance for users to realize its full potential, an SLG approach may be more appropriate. But, if users can easily understand and experience value from the product on their own, PLG might be a better fit.
2. Who is your target market? Are you selling to large enterprises, SMEs, or smaller startups? SLG often works better for enterprise-level deals where high-touch, personalized interactions are key to building trust with decision makers. Whereas PLG works well for a broader audience, including smaller businesses or individuals who prefer to explore products independently.
3. What are your customers’ buying preferences? Do your customers prefer personalized sales interactions, or are they more likely to engage with self-service options? Understanding how your customers prefer to evaluate, try, and buy products will help determine whether SLG’s consultative selling or PLG’s self-service approach makes the most sense for your organization. 
4. How scalable is your current team and infrastructure? If scaling through human interactions is resource-intensive for your organization, PLG might be a more scalable option with lower customer acquisition costs. However, if you have the resources to build and expand a sales team, SLG could allow for more tailored, high-value sales processes, especially for complex or high-ticket offerings.
5. What’s your long-term growth goal? Are you looking to quickly scale with a large volume of users, or do you want to focus on higher-value deals that take longer to close? PLG can offer rapid, organic growth, while SLG may yield larger contracts and longer-term customer relationships. A hybrid approach could also be considered if your product serves both small and large customers with varying needs.

By answering these questions, you’ll be better positioned to decide whether SLG, PLG, or a hybrid strategy will best support your business’s growth objectives. Each approach has unique strengths, and the key is aligning your growth strategy with the nature of your product, your customer base, and your organizational capacity.

KPIs for Sales Led and Product-Led Growth

Once you decide which strategy makes the most sense for your business, the next step is to map out which key performance indicators (KPIs) and metrics you want to track.

For SLG, these metrics include measuring:

• MQL to SQL conversion rates – Are your marketing efforts generating high-quality leads that your reps can effectively convert into opportunities?
• Average deal size – How much revenue are you generating per deal, and is there an opportunity to increase this by offering more value to your customers?
• Typical sales cycle length – How long does it take to close a deal, and where are the bottlenecks in the sales process that can be streamlined?
• Lifetime value (LTV) – How much revenue does a customer generate throughout their entire relationship with your organization, and are you maximizing long-term customer retention and upsell opportunities?
• Customer acquisition costs (CAC) – How much are you spending to acquire each new customer, and is your sales process efficient enough to generate a healthy return on investment?

For PLG, you’ll focus on metrics such as:

• Product adoption rate – How quickly are users signing up and actively using the product, and what can you do to increase user engagement during onboarding?
• Time-to-value (TTV) – How fast are users experiencing the core benefits of the product, and are there opportunities to reduce friction in the onboarding process?
• Expansion revenue – Are existing customers upgrading to higher-tier plans or purchasing additional features, and how can you drive more revenue from current users?
• Churn rate – How many users are leaving or disengaging from the product, and what actions can you take to reduce churn and improve retention?
• Net promoter score (NPS) – How likely are users to recommend the product to others, and are you actively addressing feedback to improve overall user satisfaction?

Importantly, make sure you also set clear benchmarks for each KPI so you can track progress over time. You’ll start by establishing your baseline metrics, which will serve as a starting point for setting achievable, incremental goals. 

For example, if your current MQL to SQL conversion rate is 25%, you can aim to improve it by a small increment, such as three percent over the next quarter. If you’re using a PLG model, you can focus on reducing TTV and tracking how this impacts user retention and engagement over time. 

Set aside time to regularly review your KPIs so you can adjust your strategies as needed and quickly respond to changing market conditions or user behavior. The best way to keep a pulse on your KPIs is via an automated dashboard that you can refresh in real-time. This will help you stay on track with your goals and priorities. 

Conclusion

The takeaway? Both SLG and PLG offer distinct advantages, and the right choice for your business will depend on factors like your product’s complexity, target market, customer preferences, and long-term goals.

To make an informed decision, use the insights outlined above to assess how your product fits within these models. For example, if your product requires high-touch support or has a complex sales cycle, SLG might be the better fit. Or, if scalability, low customer acquisition costs, and rapid user adoption are priorities, a PLG approach could lead to faster growth. By understanding the nuances of both strategies and analyzing your specific needs, you can select a growth path that aligns with your objectives and maximizes your organization’s potential.

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