Best Practices

Lights. Camera. (PLG) Action!

Published Aug 23, 2023
An AI-powered video generation tool is making a big bet on product-led growth. Will it pay off?

In theory, there are clear paths to driving product-led growth. Pendo has even outlined six core PLG principles that should guide every company’s strategy. Freemium models. Quick, easy “aha” moments. Making converting to paid feel like the natural next step. Building in virality at every turn. These and other elements contribute to the success of any PLG campaign or strategy, but in practice, they can look different depending on the specific tactics a business decides on. 

One PLG tactic product teams can lean into, for example, is to leverage what’s known as a “sidecar.” This is the term for a distinct or separate product designed to drive growth toward the main platform or product. Synthesia, a startup that offers an AI-powered video generation platform, includes a free sidecar offering that can create short video clips of AI-created avatars reading simple scripts. Their bet is that users who engage with the free sidecar will be that much more likely to sign up for the paid platform. Are they right? Synthesia’s sidecar play is the topic of the most recent PLG Teardown, Pendo’s video series in which a trio of PLG experts spotlight a popular or recently launched product and rate how effectively the business behind it is executing product-led growth. 


AI + video = an easy PLG win?

As the team explored the sidecar free video offering, they noted how easy Synthesia made it to use. No credit card was required, eliminating a potential friction point. What’s more, the company took a smart approach to demonstrating value to the prospect with each step. Once a user inputs the short script, they are notified that the AI-generated video will be sent to their email within minutes.They presented a fun promo clip from Synthesia that highlights the pain points of producing a traditional live-action video—realtime line delivery issues, production glitches and microphones cutting out, a cumbersome editing process, etc.—and contrasts them with the quick and easy process of leveraging AI to generate the same content, hassle-free. 

Finding the right freemium balance

Ultimately, the PLG experts thought that while Synthesia’s sidecar tactic was strong in theory, in practice it wasn’t working as well as it could. This had to do with the nature of the freemium offering itself. Free users never get the chance to experience the platform they’d use if they paid for a subscription.

The scope of a freemium offering can make or break a PLG effort. If a business gives away too much in a freemium version, they run the risk that users will see no need to convert to paid. Why sign up if you already get everything you want for free? On the other hand, if a business offers too little, as the PLG experts believed Synthesia did with its sidecar, it runs a different but equally dangerous risk: namely, that users will have no sense of all the things the product can do, all the ways it can make their work easier and more productive, all the time and money it could save—and therefore walk away. Why convert when you have no sense of what you’d be paying for?

When building a freemium version of a product, PLG teams need to be careful about finding the “goldilocks zone” of feature and functionality to make available—not too much, not too little, just the right amount. 

To see more PLG Teardown content, explore the full series here