As a product manager in a SaaS environment, you get to enjoy the unique challenge of balancing what often appear to be opposing forces. On the one hand, the very fact that you’re competing in the world of web-based “software as a service” means that you’re constantly monitoring—in real time—your product’s performance and the customer’s experience. This is work that finds you running live experiments or deploying rapid updates that immediately impact product functionality and, consequently, customer attitudes.
“Continuous” and “fast” are important words here. “Risky” is another.
Yet, while you’re moving at such a rapid pace to iterate on your product, you must also be exceptionally deliberate. You must pay very close attention to the details. Not just where friction exists in customer activation, for instance, but exactly where that friction exists. Not just, say, a general sense that customers aren’t as engaged as they could be, but exactly where and exactly why they’re not as engaged as they could be. Or at least as close to exactly as you can get.
“Methodical” and “measured” are important words here.
But, unfortunately, “slow” is not part of the equation.
If you’re going to move quickly, best to get your measurement right.
It’s common knowledge in the tech world at this stage that doing an amazing job of getting users to take that initial leap toward engaging with your product (acquisition) is not even close to a guarantee that your product will be successful. The road is littered with the burned-out shells of companies that were great at creating buzz-generating ad campaigns and sign-ups but were never able to amass a profitable population of engaged and active users.
And there’s the rub.
The truth is, getting customers into the weeds of your product experience is just as crucial as making them aware of your product in the first place. As a part of your fast-moving but oh-so-smart-and-methodical product management…
We have to talk about activation.
And before you can start measuring activation in a way that provides you with real insight into your customers’ experience, you need to understand what constitutes activation for your particular product. Because everyone’s product is different (even if there’s a similar product out there) and everyone’s potential customer base behaves a bit differently as well.
In one of our recent SlideShare decks, Heap looked at what activation means for a company like Facebook, for instance. For them, a customer is genuinely activated when they’ve added at least seven friends to their page in the first 10 days after signing up. For a more complex product, especially one that serves a business rather than a consumer audience, activation could be not just one key metric, but an interlocking series of small steps taken by a customer. Only you and your team can figure out what activation means for your product, but there are processes you can follow for reaching some conclusions.
The Mad Kudo blog, among others, offered some thoughts on this a few years ago.
Once you get straight on your activation event(s), then you can get serious about using product analytics to see very specifically where your activation process is breaking down or could be improved. That way, as you run those fast experiments and make those rapid product updates, you can mitigate the risk of alienating your potential customers by knowing as exactly as possible where and how to address the issues.
Remember, product managers aren’t just product managers. They’re also tightrope walkers. Finding that balance between rapid iteration and detailed measurement means making all the way across the rope and hearing the cheers from the crowd when you step onto the platform on the other side.
The next thing that can help you strike that
Balance between speed and precision is how you deal with engagement.
Once again, it will be important for you to work with your team to determine what engagement means for your particular product and your particular business. It will likely be helpful to analyze what series of customer actions tend to lead to lead to a purchase, as well as what actions tend to lead to churn. Correlating those actions—or inactions—with customer demographics may help you get a better sense of exactly where and why customers are dropping off.
All of this data will help you and your team pinpoint the key events within your product experience that can be improved so that more customers stay engaged with your product and lead you towards greater business success.
This type of careful measurement mean that, as the fast-moving tightrope walker you are, you’ll be able to have a greater level of certainty about where to focus your experiments, and thus reduce the risk that you’ll spend too much time focusing on events that don’t impact engagement or focus on those events in such a way that inadvertently decrease engagement.
It’s all about rapid precision, right?
Once you’re engaging more customers, make sure you retain them.
This is the third area of importance for you as you and your team monitor your product’s performance. Retention is indeed a major factor in the long-term growth and revenue of your product, so using product analytics to help you understand why customers stick around or leave over time will be key.
As stated on the GoSquared blog a few years ago, “churn kills SaaS businesses”, so reducing that churn will necessarily be a big part of your tightrope walk.
While there are many resources online that evangelize around retention and provide helpful ways to calculate that metric, in some ways the harder task is understanding why customers who have activated and are engaged actually stop using your product. Heap is a product analytics-focused company, so of course we offer ways to track issues related to retention.
But it’s also important to realize that qualitative information may be just as crucial to understanding why customers drop off over time. Here, there’s simply no substitute for reaching out to customers directly and speaking with them about their experience with your product.
Combine that effort with strong and detailed product analytics and you’ll be able to work with your team to iterate on your product experience in ways that have the most immediate impact on retention.
In closing
Overall, if you focus your measurement activity on these three areas: activation, engagement and retention, you will give yourself the best opportunity to reach your KPI goals, delight your customers, and satisfy your team and business partners.
Being able to move quickly AND accurately is the balance to go for. There are a lot of ways Heap can help.
Keep pushin’!