Product Trends: Embracing a Product-Led Approach in a Customer-Centric World

Carlos Gonzalez de Villaumbrosia
8 min readNov 23, 2023

Today I want to talk about a crucial aspect of product management: creating and maintaining a world-class customer experience, especially in an era where customer acquisition costs are soaring.

This post is a roadmap for product leaders to understand and implement strategies that place the customer experience at the forefront.

The authenticity of excellent customer experience

We all know that you can’t fake a great customer experience, and I couldn’t agree more. Leading with your product means consistently over-delivering on customer expectations. Customers have an innate sense of when their needs are genuinely being met, and they respond accordingly. This level of customer satisfaction leads to two key outcomes:

Customer Retention

Taking the example of Netflix’s loss of over one million subscribers in 2022 is an illustrative case of understanding the deep connection between product value and customer retention. This significant subscriber drop can be viewed fundamentally as a product issue. In streaming services, with so many options available, a product needs to do more than just meet basic user needs. The key is to consistently deliver real, tangible value — value that resonates with users on a personal level, making the product an indispensable part of their daily routine.

Netflix’s situation underscores the importance of continually evolving and adapting the product to align with changing user preferences and market trends. It’s about curating content that not only entertains but also connects with the audience on a deeper level, offering unique and diverse programming that can’t be found elsewhere. This involves understanding the subtleties of user behavior, preferences, and unmet needs, and then translating these insights into an enriched viewing experience.

Moreover, this example highlights the significance of creating a product experience so enriching and engaging that users see it as integral to their entertainment lifestyle. This is where the concept of exceeding user needs comes into play. It’s about delivering surprises, exceeding expectations, and consistently providing a sense of discovery and novelty. When a product like Netflix achieves this level of integration into users’ lives, the decision to unsubscribe becomes less about cost and more about losing out on a valuable part of their entertainment experience.

Customer Expansion

Providing a world-class customer experience isn’t just about keeping the customers you have; it’s also a powerful tool for growth. Happy customers become advocates for your product. They become your inbound distribution channel, attracting new customers. This organic growth is more sustainable and cost-effective than any paid marketing strategy.

For example, in the last year, the collaboration tool Notion, effectively transformed its users into active promoters, leveraging their satisfaction to attract new customers organically. Its approach has been to focus intensely on user feedback to continuously refine, and enhance its product. They’ve created a highly adaptable tool that appeals to a wide range of users, from individual freelancers to large corporations.

Moreover, their community-driven approach, featuring extensive resource libraries and user-generated templates, has fostered a sense of belonging among users. This community aspect not only improved their user experience but also encouraged them to share their positive experiences with others.

Authenticity insights

All in all, in today’s competitive market, where every penny counts for consumers and clients, the ability to tap into the voice of the customer is invaluable. Companies that accurately identify and meet their customers’ needs are more likely to retain their users, even during economic challenges.

As Product Leaders, our goal should be to create products that not only solve problems but also deliver unexpected delight. It’s about understanding the subtle nuances of customer needs and addressing them in ways that resonate on a deeper level.

This is the path to building products that not only draw in customers but also turn them into long-term advocates. Your product is only as good as the customer experience it provides. You should strive to make that experience nothing short of exceptional.

Product-led growth is for everyone, not just your Product team!

Product-led growth is fascinating. This approach isn’t confined to your Product teams alone; it’s about making user experience a priority across your entire organization. A select group of companies, predominantly in the tech industry, have the opportunity to take this further by turning their Product into their primary engine for growth.

Reflecting on the past year, we’ve seen how Product-Led Growth has surged into the mainstream. Organizations across the board are experiencing their ‘Aha’ moments, realizing the immense value of adopting a Product Mindset and steering towards a Product-led approach.

Take, for instance, Zoom, a company that has become synonymous with video communications. Amidst the shift towards remote work and virtual meetings, Zoom’s intuitive and user-friendly platform catalyzed its growth. They focused on creating a product so seamless and efficient that users naturally preferred it over other options.

Their platform’s ease of use, reliability, and scalability made it a go-to choice for businesses, educational institutions, and individual users alike. Zoom demonstrated the power of Product-led growth by allowing new users to experience the core functionalities of their platform without a steep learning curve or aggressive sales tactics. The product experience became the primary driver of their growth, showcasing how a well-designed product can organically attract, retain, and expand its user base.

In this manner, Zoom and similar tech companies are leading examples of how turning a product into the primary engine for growth isn’t just a theoretical concept but a practical, achievable goal in today’s business world.

Product-led growth insights

A Product-led growth approach isn’t just an alternative go-to-market strategy; it’s becoming a necessity. Imagine a scenario where your customers are buying, upgrading, or recommending your product without any direct sales interaction. That means more revenue with lower acquisition costs — a crucial advantage in these challenging times.

In short, this shift towards a Product-led paradigm is about cultivating a culture where every team member understands the significance of the product experience. From engineering to marketing, customer support to sales, everyone plays a role in enhancing the product experience, making it so compelling that it drives growth on its own.

So, whether you’re leading a product team or are part of a larger organization looking to become more product-centric, be mindful that Product-led growth involves everyone. It’s about creating products so intuitive, so engaging, that they become the main vehicle for your company’s growth.

Sales-led companies can also use Product-Led Growth to level up

Let’s be clear, adopting a purely Product-Led Growth strategy isn’t the only path to success, and many companies continue to thrive with sales-led approaches. However, this doesn’t mean that sales-led companies can’t also benefit from embracing elements of PLG.

Think about it, having a strong sales team is undoubtedly valuable, but imagine combining this with a bottom-up PLG methodology. This approach amplifies the effectiveness of your sales team by giving them a new edge. They can qualify prospects and book meetings with users who already have a high level of engagement and buy-in because they are active users of your product.

Take, for instance, the approach adopted by Slack. While Slack has always been known for its strong product-centric approach, this year they’ve seamlessly integrated PLG strategies into their sales-led model.

This combination has revolutionized their customer engagement and conversion rates. Slack has enabled its sales team to engage with prospects who already recognize the product’s value by allowing potential customers to first use their collaboration tool. When the sales team steps in, they’re not starting from square one; they’re engaging with informed, product-experienced leads. This strategy has not only streamlined Slack’s sales process but also significantly improved its customer acquisition and retention rates.

Sales-led Insights

This synergy is powerful. It’s about enhancing the traditional strengths of a sales-led approach with the user-centric focus of PLG. Your sales team isn’t just cold-calling or blindly reaching out; they’re engaging with prospects who have already experienced the value of your product firsthand. This leads to more meaningful conversations, higher conversion rates, and ultimately, a more efficient sales process. You can find out more about this trend in the Future of Product Report 2023.

Customer Acquisition Costs were up 60–75% between 2014 and 2019 (Clearbit and ProfitWell) before Covid-19 sent costs skyrocketing. Comparing 2013 to 2022, we see CAC up 222% (Business Wire).

So, keep in mind that integrating PLG strategies into your existing model can be a game-changer. It’s about leveraging the best of both worlds — the proactive, relationship-building strengths of a sales team, combined with the organic, user-driven growth of PLG. You can create a more dynamic, responsive, and ultimately successful strategy for growth and customer engagement by adopting this dual approach.

What Does the Future Hold?

We’re living in an era where being Product-Led is becoming essential, not just for companies with a Product-Led go-to-market strategy but for all organizations. In 2023, it’s evident that every company, regardless of its primary go-to-market approach, is fundamentally a customer experience company. This shift means that Product roles are increasingly crucial, securing a permanent and prominent place at the decision-making table.

Consider Shopify, a company that traditionally has been sales-driven. This year they have taken significant strides to become more Product-Led. They have started to invest heavily in user experience and product innovation, recognizing that these elements are key to driving growth and customer satisfaction. This shift has not only enhanced their product offerings but also transformed how they engage with their customer base.

In PLG-focused companies, we’re seeing an expansion of the Product role, all the way up to the Chief Product Officer (CPO). This trend is not just about giving Product a seat at the executive table; it’s about acknowledging the critical role that product strategy plays in the overall success of a company. The CPO’s perspective is invaluable in steering the company towards innovative solutions that meet and exceed customer expectations.

On the other hand, sales-led companies are increasingly embracing Product-related roles, such as Product Marketing. These roles bridge the gap between product development and customer outreach, ensuring that the product’s value proposition is effectively communicated and aligned with market needs. Product Marketing becomes a crucial link in translating product capabilities into compelling narratives that resonate with the target audience.

As we look to the future, it’s clear that the Product function will continue to grow in importance and influence. Whether in a PLG-focused or a sales-led company, the emphasis on product innovation, user experience, and market alignment will only intensify. This evolution presents a tremendous opportunity for product leaders.

The key takeaway here is that the future of business is unequivocally Product-led. No matter your company’s primary go-to-market strategy, adopting a Product-Led approach will be instrumental in driving growth, enhancing customer experiences, and maintaining a competitive edge in the market.

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Carlos Gonzalez de Villaumbrosia

CEO at Product School — Global leader in product management training