Influence org with CAC LTV in PLG

Our goal is to build a Self-Service Growth Engine using our Product-led Growth motion.

We wanted to make our product sell itself.

We had to track what worked and what didn’t

How are we progressing

And are making the $$$ back

Our VP of Finance suggested this Excel heatmap…

This Excel helped us track two important numbers:

• How much do we spend to get customers (CAC)

• How much money they bring in (LTV)

We also track:

• When the free PLG customer sign-up

• When the free PLG customer upgrade & purchase

We had customers’ acquisition date

We had the date when they decided to upsell

In January, we had 1 paying customer for a $2000 ARR contract.

In March, we had 2 paying customers.

• One customer upsold in April 2023 for a $3000 ARR contract.

• Another customer upsold in June 2023 for a $5000 ARR contract.

In February, we had 0 paying customers and we spent $11,000 in acquisition.

But that doesn’t mean the acquisition investment is lost.

We can still go back and convert that February cohort.

It’s possible they are not ready to buy or experience the value.

That is why with Product-Led Growth, we can nurture those cohorts.

And upsell those customers.

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With this Excel sheet, you can showcase to your organization…

Product-led Growth free customers “graduate” into paying customers

It might not be obvious for our ROI but as long as free-customers are active…

Free PLG customers have an opportunity to upgrade

And thus create a return on our investment

»»» Download the Excel CAC LTV Heatmap template here: https://docs.google.com/spreadsheets/d/1qt16CEzHTyCgcg-VFM0uQCWHWIsZk5mzMBPI6gd5Vpk/edit?usp=drive_link

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The sooner the ROI happens, the faster your Product-Led Growth flywheel.

That’s for another post.

I am Gary Yau Chan. 3x Head of Growth. Product Growth specialist. 26x hackathon winner. I write about #PLG and #BuildInPublic. Please follow me on LinkedIn, or read about what you can hire me for on my Notion page.