Behind the Scenes of Our PLG Strategy Evolution

The story behind the PLG journey that led to Amplitude’s new Plus plan.

Inside Amplitude
October 18, 2023
Image of Justin Bauer
Justin Bauer
Chief Product Officer, Amplitude
Plus behind the scenes

Amplitude has long been known as a product-led growth (PLG) company. And for good reason. Our Starter plan is the most robust free plan on the market, and our scholarship program continues to support the growth of the next class of world-changing startups. But PLG strategy, like any other business strategy, must evolve over time. For us, the evolution of our PLG effort over the years has as much to do with our business priorities as it does with market changes.

Let’s look at how we’ve evolved our approach to PLG and where we are today.

The beginning: 10M events for free

When we officially launched the Amplitude product in 2014, we needed to make a name for ourselves. So we turned to our current customers for feedback. They shared that, while they loved the free version of Amplitude, once they reached the point where they needed more advanced features, it became too expensive for their stage of growth. And that feedback was valid. We knew we needed to figure out a way to better serve startups that hadn’t quite reached the necessary level of funding.

And so, in August 2015, we announced 10 million events for free, expanding our freemium offering to better support those seed and Series A companies looking to build better products. Why 10 million? Our data showed us that the threshold was a good indicator that a startup had found product-market fit, a critical step to securing VC dollars they could invest back in their tech stack.

I had felt their pain myself. Before Amplitude, my pre-series A startup used a competitor’s tool, and we were spending a significant amount of money on their paid plan without being able to afford it. They were charging $1,000 a month or more for something we thought should be free.

It turns out that Amplitude providing 10 million events for free was one of the best decisions we’ve ever made. It also wasn’t lost on us that an announcement like this would draw the attention of our competitors and the press.

Launching the year-long trial

Our free plan helped lots of companies like DoorDash and Peloton go from early-stage startups to household names. Today, nearly 20% of our largest paying customers started their Amplitude journey on our free plan. But although we witnessed the hypergrowth of many companies, we recognized that not every startup grows at the same pace. It was a similar challenge to the one we faced in 2015: Not every business is ready to move from paying nothing to paying five figures.

Not every business is ready to move from paying nothing to paying five figures.

We thought about ways we could further ramp customers to our more advanced features without requiring them to pay $50k upfront. Of course, trials are a great way to do this. But we knew the standard seven- or 30-day period was way too limiting for companies looking for product-market fit and raising their next round of funding. So instead of one month, or even six months, we settled on a one-year free trial of our Growth plan, putting more advanced analytics capabilities in the hands of early-stage startups. And the scholarship program was born. Today, startups with less than $5m in funding and less than 20 employees can apply for one year of free Growth Plan access.

Reinvesting in product activation

At this point, we had two plans to help startups grow and scale with Amplitude. Job done, right? Not quite. Though our scholarship program continued to see success, it wasn't serving everyone—not every startup is backed by traditional venture capital (VC). We also heard that not publishing our pricing publicly was scaring some customers away. So, even though it wasn't our focus to aggressively monetize startups, this learning showed us our approach wasn't working.

At this time, we were growing rapidly with enterprise companies, too. This meant we were expanding with new products and investments to help us maintain this market. But it also meant we lost sight of what matters most to startups, like simple activation and ease of use. We know activation is a critical part of the PLG motion. And, if we were going to get startups to graduate from a free to a paid plan, we needed to be best in class in activation.

So we decided as a product leadership team to make activation our top priority. We invested in user experience upgrades across the entire analytics journey. This included navigation updates to make our homepage experience more intuitive, taxonomy templates, chart controls, and AI-powered Ask Amplitude. We rallied around our activation metrics and brought new ways to measure user experience, like Usability Metric for User Experience (UMUX) Lite. It was a lot of work, but the end result was worth it. We saw massive improvements across activation and UMUX metrics, including improved time to chart save, a key indicator that people were finding value quickly within our product.

Of course, not every bet was a winner. One of our big learnings was “show, don’t tell.” Not every first-time user is an analytics expert. To help activate our users, we needed to serve as a guide, showing them where to go within our platform to uncover insights or how to instrument data. Supporting our goal of showing data instrumentation, we released default event tracking (DET). DET logs generic and common events through our Browser SDK to remove the burden of instrumenting and defining every event, ultimately guiding teams to faster insights.

The importance of growth marketing

The evolution of our PLG motion was not just a free plan and activation investments. In 2018, we officially established our Growth PM team. As that team matured and grew, we started specializing around different stages of the customer journey, including our ‘growth traffic’ team, focused specifically on acquisition. But over time, it was clear that growth couldn’t just live within the product organization. Without a cross-functional growth strategy, we would not be successful. In 2022, we brought in PLG expert Elena Verna as our interim head of growth. She helped us understand what was working—and, more importantly, what wasn’t—in our PLG strategy.

One of the underinvested areas? Growth marketing. We had really strong PLG experts on our product team, but we weren’t seeing the success we wanted because that didn’t carry over into our marketing organization. One without the other doesn’t work. The good news? We already had the right person for the job. Our newly hired VP of Revenue Marketing, Ashley Stepien, asked our then Director of PLG Franciska Dethlefsen if she would be open to taking on a new role: Head of Growth Marketing. And she was. Today, this team of twelve has driven 110% year-over-year pipeline growth generated from the product through our investment in product-led sales. Through SEO and web experience investments, they’ve increased organic traffic by 20% and product signups by nearly 50%.

Launching the new Plus plan

This brings us to today. This week, we announced the Amplitude Plus plan, which brings together the best of Amplitude’s Digital Analytics Platform in a single, low-cost plan. So, how did our PLG evolution lead us here?

As we built new activation-focused features into our product, we reflected on many startups' other feedback: transparent pricing. We knew a good, self-serve plan required cost transparency, and we also knew today’s startups needed a full stack of analytics tools without the full stack costs.

In the same way we made elements of Analytics free back in 2015, we’re doing the same with CDP and feature management tools previously only available in our paid Experiment plan. Teams finally have platform access at a price point they can afford.

Though we built this plan with our startup community in mind, the fact is, whether you’re seeking seed funding or are already a household name, growing and retaining your customer base is essential to success.

Learn more about the Plus plan here and get started with Amplitude today.

About the Author
Image of Justin Bauer
Justin Bauer
Chief Product Officer, Amplitude
Justin Bauer is the Chief Product Officer at Amplitude, where he strives to make it easy for companies to make better decisions from their data. He’s a 2x entrepreneur as well as an alumnus of McKinsey, Stanford GSB and Carleton College.

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