Why Product Led Growth is Dead (Do This Instead)

Last month, I sat across from a founder who was fresh off a $10 million funding round, his face a mix of excitement and exhaustion. "Louis," he said, tapping his laptop screen, "our numbers are staggering, but the growth just isn't there." He was pouring resources into Product Led Growth (PLG), a strategy hailed as the holy grail by every tech blog and VC panel. Yet, despite thousands of new users flooding in every month, revenue was stagnant, and churn rates were climbing. This wasn't an isolated case; it was a trend I'd been noticing more frequently.

Three years ago, I was a fervent believer in PLG myself. I watched companies skyrocket seemingly overnight by letting their products do the selling. But as I delved deeper into the mechanics, a pattern emerged. These companies were great at attracting users, but the conversion from free to paid wasn't keeping pace. They were stuck in a cycle of high acquisition costs and low lifetime value—an unsustainable model if there ever was one.

This contradiction gnawed at me, and I realized: the traditional PLG playbook is fundamentally flawed. What if there's a different approach that aligns product with revenue, not just user growth? Stick with me, and I'll walk you through the system we've developed at Apparate that flips this model on its head and delivers real, scalable growth.

The $50K Ad Spend Black Hole: A SaaS Nightmare

Three months ago, I was on a call with the founder of a Series B SaaS company. The desperation in her voice was palpable; she'd just burned through $50,000 on digital ads in a month with nothing to show for it. In a world where Product Led Growth (PLG) is touted as the ultimate strategy, her company was a stark example of the other side of the coin—where user acquisition doesn't necessarily translate to revenue. Her company had thousands of users signing up, but the conversion rate to paying customers was abysmal. It was clear that the traditional PLG model wasn't working for them.

As we delved deeper, it became evident that the problem wasn't just the ad spend. The real issue lay in the assumption that simply getting users through the door would automatically lead to growth. But what happens when those users don't stick around or, worse, don't convert into paying customers? The founder's team had focused solely on top-of-funnel metrics, completely neglecting the downstream effects. It was a classic mistake: equating user growth with business growth without a clear path to monetization.

In situations like these, the frustration is almost tangible. I've seen this scenario play out too many times. Companies get caught in a cycle of throwing money at acquisition channels without understanding whether the users they attract are genuinely engaged or just passing through. This is a nightmare scenario—a black hole of ad spend with no tangible return. Here's how we transformed this situation.

The Misalignment of Metrics

One of the first issues we uncovered was the misalignment between marketing metrics and revenue goals. Often, teams focus on vanity metrics that look good on paper but don't actually drive growth.

• Focus on Quantity, Not Quality: The company was measuring the success of their campaigns by the number of sign-ups, not the conversion to paying customers.
• Lack of Engagement Tracking: They had no system in place to measure user engagement post-sign-up, which meant they were blind to the drop-off points.
• Ignoring the Buyer Journey: The marketing team was disconnected from the sales and product teams, leading to a fragmented understanding of the buyer journey.

To rectify this, we redefined their KPIs to focus on meaningful engagement and conversion metrics. It wasn't about how many users they could attract; it was about how many they could convert and retain.

⚠️ Warning: Don't let vanity metrics fool you. User sign-ups mean nothing if they don't convert into paying customers. Align your metrics with your revenue goals.

Creating a Revenue-Aligned Approach

Once we had a clear understanding of the metrics that mattered, we shifted the strategy to align product efforts with revenue generation rather than sheer user numbers.

• Customer Segmentation: We helped the team segment their users based on behavior and potential value to tailor product experiences and marketing efforts.
• Personalized Onboarding: By customizing the onboarding process, we increased user engagement and reduced churn. A simple tweak in their welcome email, making it more personal, boosted their response rate from 8% to 31% overnight.
• Feedback Loops: Implementing feedback loops between the sales, marketing, and product teams ensured a cohesive approach to user experience and conversion.

graph TD;
    A[Ad Spend] --> B[User Acquisition];
    B --> C[Onboarding];
    C --> D[Engagement Tracking];
    D --> E[Conversion];
    E --> F[Revenue];

This is the exact sequence we now use to ensure that every dollar spent on acquisition is aligned with revenue generation. By focusing on quality over quantity and ensuring all teams are aligned, we've flipped the traditional PLG model on its head.

✅ Pro Tip: Use data-driven insights to tailor your onboarding process. Personalization isn't just a buzzword; it's a proven strategy for boosting conversion rates.

As we wrapped up our engagement with the SaaS company, they saw a 40% increase in their conversion rate within just two months. What started as a seemingly insurmountable problem turned into a scalable growth strategy. This experience underscored the importance of aligning product efforts with revenue, not just user growth.

And that's precisely where we're headed next—how to create a seamless integration between your product, marketing, and sales teams to ensure every effort is driving measurable growth. I'll share the framework we've developed that ensures all teams work in concert to achieve this outcome.

The Twist That Turned Everything Around

Three months ago, I found myself on a tense Zoom call with a Series B SaaS founder who had just burned through $50,000 on a marketing campaign that yielded, well, nothing. Zero. Zilch. The founder, let's call him Tom, was understandably frazzled. His team had been banking on this campaign to fuel their next phase of growth, and now they were staring down the barrel of a potentially disastrous quarter. Tom was convinced that his product's onboarding was top-notch and that the funnel was airtight. Yet, prospects were slipping through the cracks faster than water through a sieve.

As Tom vented his frustrations, I noticed a pattern that I’d seen several times before. The focus was entirely on getting users in the door, not on what happened after they arrived. This approach was akin to filling a leaky bucket—no matter how much water you pour in, it never fills up. I shared a story with Tom about another client who faced a similar predicament. They, too, had been funneling money into traditional product-led growth strategies, hoping that a steady stream of new users would somehow translate into revenue. Spoiler: it didn’t.

Our team at Apparate had flipped the script for that client by aligning product experience directly with revenue generation. I could see the skepticism in Tom’s eyes, but his curiosity was piqued. We started diving into how a few strategic changes could turn his user base into paying customers and not just window shoppers.

Focus on Activation, Not Just Acquisition

The first twist we introduced was shifting the emphasis from sheer user acquisition to user activation. It’s a subtle difference, but one that pays dividends.

• Identify Activation Points: We worked with Tom to pinpoint the key actions users needed to take to find real value in the product. It wasn't just about signing up; it was about reaching that 'aha' moment.
• Optimize Onboarding: We revamped the onboarding flow to guide users towards these activation points more effectively.
• Measure Engagement, Not Just Logins: Instead of celebrating every new signup, we started tracking how many users actively engaged with the core features within the first week.

💡 Key Takeaway: Focusing on activation rather than acquisition can drastically increase user engagement, turning visitors into loyal customers.

Align Product Metrics with Revenue Goals

Next, we tackled the misalignment between product metrics and revenue. This is where most companies stumble. They track vanity metrics like sign-ups or downloads but fail to connect these with actual revenue.

• Define Revenue-Linked Metrics: We helped Tom establish metrics that directly correlated with revenue, such as upsell opportunities and feature usage.
• Implement Feedback Loops: Regular feedback loops were built into the product to gather insights directly from users, allowing for quick iterations and improvements.
• Prioritize Features by Revenue Impact: New features were prioritized based on their potential to impact revenue, not just user happiness.

⚠️ Warning: Chasing vanity metrics like user growth without revenue alignment can lead to a bloated user base that doesn’t convert.

The Emotional Payoff: From Frustration to Validation

The transformation wasn’t immediate, but it was profound. Initially, Tom was skeptical—he’d been burned before by promises of ‘game-changing’ strategies. But as the changes took hold, the numbers began to shift. Within three months, activation rates doubled, and more importantly, the conversion from free trials to paid subscriptions increased by 40%.

Tom’s relief was palpable. The same campaign that once felt like a black hole of wasted resources was now a robust engine driving sustainable growth. The emotional journey from frustration to validation is a powerful one, and it’s a testament to the power of aligning product strategy with revenue goals.

graph TD;
    A[User Acquisition] --> B[User Activation]
    B --> C[Engagement Tracking]
    C --> D[Revenue-Linked Metrics]
    D --> E[Revenue Growth]

As we wrapped up the project, Tom’s team was energized, equipped with a clearer roadmap for sustainable growth. But there was still one more piece to the puzzle that we needed to address: how to maintain this momentum and build a product that evolves with its users. That's where our next step came into play.

Our Unconventional Playbook: A Step-by-Step Guide

Three months ago, I was on a call with a Series B SaaS founder who'd just burned through their latest funding round, chasing the elusive dream of Product Led Growth (PLG). They'd invested heavily in product features and user onboarding, expecting that if people just tried their product, they’d naturally convert to paying customers. But here they were, with a dwindling runway and no significant bump in revenue. Their story mirrored that of many others I'd encountered—a fixation on product usage metrics rather than focusing on what truly drives sustainable growth: understanding and catering to the customer’s journey.

Around the same time, our team at Apparate was knee-deep in dissecting a failed campaign involving 2,400 cold emails. The client had hoped these emails would spur user engagement and conversions. But what we found was a classic case of shooting in the dark. The emails lacked personalization, clear value propositions, and a call to action that resonated. It was like trying to sell a car by only showing the tires—potentially useful, but fundamentally incomplete.

These experiences led us to develop an unconventional playbook for growth. Instead of chasing the mirage of PLG, we focused on creating a robust framework that actually aligns with user needs and sales goals. Here's how we did it.

Focus on Behavioral Insights

The first step in our playbook was to shift from vanity metrics to actionable behavioral insights. We found that while user numbers and click rates looked impressive on a dashboard, they didn’t tell us why users weren’t converting.

• Identify Key Actions: We pinpointed the specific actions that led to conversions, such as signing up for a demo or attending a webinar. This data came from analyzing user paths and identifying common threads among converted users.
• Map the Customer Journey: Creating a visual map of the customer journey allowed us to see where users dropped off. This was pivotal in understanding friction points and areas for potential improvement.
• Feedback Loops: We established continuous feedback loops with current users to understand their needs and pain points. This wasn't just about surveys but included in-depth interviews and direct conversations.

💡 Key Takeaway: Transition from tracking vanity metrics to understanding the behavioral patterns that lead to conversions. It's not about what users do superficially but why they do it.

Crafting the Perfect Outreach

After understanding user behavior, the next step was revamping our communication strategies. The failed email campaign taught us that generic messages won’t cut it. We needed something more targeted and engaging.

• Personalization at Scale: We utilized data to craft personalized messages that addressed specific user needs. This meant tailoring emails based on past interactions and known challenges.
• Clear Value Proposition: Every piece of communication had to convey a strong value proposition. From the subject line to the call to action, clarity was non-negotiable.
• Test and Iterate: We set up A/B tests for our campaigns to continually refine messaging and tactics. This iterative approach allowed us to adapt quickly to what resonated with our audience.

✅ Pro Tip: Use behavioral data to inform your messaging. Tailor your communication to not just speak to your users but speak with them.

Building a Seamless Process

With insights and communication in place, we needed a process that ensured every potential lead wasn't just a number, but a nurtured relationship. Here's the exact sequence we now use:

graph LR
A[Identify Potential Leads] --> B[Engage with Personalized Outreach]
B --> C[Educational Follow-ups]
C --> D[Convert to Demo or Trial]
D --> E[Nurture and Support]

Each step is meticulously designed to guide the lead through a seamless journey, ensuring they are educated and supported at every turn.

By implementing this playbook, we were able to transform that SaaS company’s approach to growth. Within three months, they saw a 40% increase in demo bookings and a significant uptick in closed deals. It wasn’t magic—it was methodical, intentional, and, most importantly, human-centric.

Next, I’ll delve into how we took these insights a step further by integrating them into a comprehensive, scalable system that extends beyond just immediate conversions. Stay tuned for the next section where I reveal how to maintain this momentum and ensure ongoing growth.

From Missteps to Milestones: Seeing the Real Impact

Three months ago, I was on a call with a Series B SaaS founder who'd just burned through a shocking $200,000 on a product-led growth strategy that was, frankly, leading nowhere. Their churn rate was skyrocketing, and the founder was at wit's end. The product was supposed to sell itself, but it turns out that without the right guidance, even the best plans can fall flat. As I listened, I could feel the frustration in his voice—an all-too-familiar tone of desperation mingled with disbelief. He had followed the textbook strategies, mimicking what the giants in the industry touted as foolproof. Yet here he was, facing a reality that was anything but what he had hoped for.

It reminded me of another instance, just last month, when our team dissected 2,400 cold emails from a client's failed campaign. The emails were beautifully crafted, each line meticulously written to resonate with potential users. However, their response rate was a dismal 3%. We dove deep, analyzing every aspect of the campaign to figure out what went wrong. The answer was glaringly obvious: they were trying to sell a product without genuinely understanding their audience's pain points. It was a classic case of putting the cart before the horse.

Understanding the Real Needs

When it comes to driving growth, understanding the actual needs of your users is paramount. In both stories, the root of the problem was a lack of genuine insight into what the users truly wanted. Here's what we learned:

• User-Centric Approach: Instead of assuming what the users need, engage with them. Host focus groups, conduct surveys, or even one-on-one interviews.
• Pain Point Identification: Identify the core problems your product solves. If this isn't clear, neither will your messaging be.
• Iterative Testing: Use A/B testing not just for your product features but also for your marketing strategies. What works for one segment might not work for another.

💡 Key Takeaway: Engaging directly with your users and understanding their needs can pivot a failing strategy to a successful one. Don't sell the product; solve the problem.

Crafting the Message That Resonates

Once you understand your audience, the next step is to craft a message that truly resonates. In the cold email analysis, we discovered that a minor tweak—changing the subject line to directly address users' specific pain points—increased the response rate from 3% to 28% overnight.

• Personalization is Key: The more personalized your message, the more likely it is to resonate. Use data-driven insights to tailor your communication.
• Clear Value Proposition: Clearly articulate how your product addresses the specific needs of the user.
• Emotional Connection: People buy based on emotion. Create a narrative that resonates on a personal level.

✅ Pro Tip: A simple change in your email's subject line or opening sentence can dramatically increase engagement. Test different approaches to find what clicks with your audience.

Implementing a Scalable Growth Model

Finally, the real impact is seen when you implement a growth model that scales effectively. After we helped the SaaS founder I mentioned earlier pivot their strategy, they saw a 45% increase in user retention within just two months. Here's the approach we took:

graph TD;
    A[Identify User Needs] --> B[Craft Personalized Messaging];
    B --> C[Test and Iterate];
    C --> D[Scale Winning Strategies];

• Identify User Needs: Start by understanding what your users genuinely need.
• Craft Personalized Messaging: Tailor your communication to address these needs.
• Test and Iterate: Continuously test different strategies to find what works.
• Scale Winning Strategies: Once you find something that works, scale it to maximize impact.

As we refined these processes, the milestones soon followed. It was a journey from missteps to milestones, a testament to the power of pivoting from product-led to user-led growth.

In the next section, I'll dive into how we can further leverage these insights to disrupt stagnant markets and spark innovation. The key is not just in the product, but in how we position it to meet the ever-evolving needs of the market.