Revenue
PLG flywheel
Definition of
A PLG (Product-Led Growth) flywheel is a growth model that leverages a self-service, user-centric approach to drive adoption and revenue growth for a software product or service. The PLG flywheel is designed to create a cycle of user engagement, product usage, and customer success, where each stage of the process reinforces the others and leads to faster and more sustainable growth over time. The PLG flywheel typically involves three stages: acquisition, activation, and expansion, with a focus on creating a seamless user experience and delivering value at each stage of the customer journey. As an example for B2B SaaS, consider a project management tool that offers a free trial for new users. The acquisition stage of the PLG flywheel may involve promoting the tool through online advertising or social media campaigns, while the activation stage may involve providing a simple onboarding process and access to core features that help users achieve their goals quickly. Once users have become activated, the expansion stage may involve encouraging them to upgrade to a paid plan, offering premium features or integrations that enhance the value of the tool, and providing personalized support or training to help users achieve even greater success. As more users adopt the tool and achieve success, they may refer others to the tool, creating a self-sustaining cycle of growth and profitability.
Named after a wheel that absorbs energy as it continues spinning, a PLG flywheel accumulates users over time by providing a delightful product experience that retains existing users and attracts new users. Flywheel go-to-market models are generally used by high-volume businesses with self-serve onboarding.
