How can you apply product metrics to gain a competitive edge?

Product metrics are as good as the actions they facilitate. Make them actionable, relevant, and experiment-driven. Collecting data is only half the battle. What really counts is how those metrics drive change within your business. Metrics should be more than just a dashboard you glance at — they should be an indicator product health and a compass for growth.

Customer acquisition metrics focus on the number of new customers you attract and the associated costs. Understanding the effectiveness of your acquisition strategies and the acquisition cost per customer is vital for optimizing marketing and sales efforts. Customer lifetime value provides insights into the revenue generated from each customer throughout their engagement with your product. By evaluating customer lifetime value, you can assess the long-term profitability of your customer base and determine strategies to enhance retention and upselling opportunities.

It all comes down to one thing: how you define success. If you define success as making more money than your competitors, then you'll want to focus on metrics like conversion rate, average order value, and repeat purchases. If you define success as having happy customers who feel like they got what they wanted from their purchase, then you'll want to focus on metrics like Net Promoter Score (NPS) and customer satisfaction surveys.

When thinking about metrics, It's important to differentiate lagging and leading indicators. A lagging indicator results from your effort in delivering leading indicators. Often what you control are leading indicators. Great product metrics distill from the ultimate lagging indicator: product market fit. Distil what PMF means for your problem space. A great way to measure PMF is through Sean Ellis test of how many users are disappointed from losing access to your product. Every other metric will follow your ability to improve your product market fitness.

Choosing impactful product metrics is a pivotal strategy for gaining a competitive edge. Align metrics with your product's stage and goals. Measure Customer Satisfaction (CSAT) using surveys; assess Customer Retention through cohort analysis. Evaluate Customer Acquisition Cost (CAC) to optimize acquisition efforts. Determine Customer Lifetime Value (CLTV) to ensure profitability. Gauge Product-Market Fit through user feedback. Use frameworks like OKRs and AARRR for focused measurement. Analyze CSAT data to enhance customer experience; leverage cohort analysis for improved retention. Informed metric selection drives success and differentiation.

Here are some things to keep in mind when using metrics to drive your business: ?? Metrics should be tied to goals. Make sure that the metrics you use are tied to clear, measurable goals. If they're not, it'll be hard to know how well your product is performing or where improvements could be made. ?? Don't get stuck in the mud. If there's one thing I've learned from my experience as a product manager, it's that it's easy for us to get caught up in the details and lose sight of the bigger picture. It's important that we don't get bogged down by details and instead focus on things like customer satisfaction and overall customer value.

A common mistake most Product Managers do is tracking too many metrics, creating too many dashboards, and adding to many views into their Analytics and Data tools. Keep your data points and metrics clean and clear. Focus on the most important lagging and leading indicators, and know what actions you'll make depending on the behaviour of each metric. A metric that doesn't lead to action is a vanity metric.

In the process of analyzing your product metrics, be aware of vanity metrics. Vanity metrics, such as total page views or app downloads, may look impressive but often lack actionable insights. Focus on metrics that directly relate to your business goals and customer behavior.

In my opinion, using OKRs helps determine the Metrics that defines your Roadmap. A good example: OKR - Increase Active users by 20% Metrics - define what active users mean, determine what will make users active and how to measure it Roadmap - build customer delight in existing features and track

Most Product Teams either fall on the side of not using metrics at all, or depending too much on metrics to make decisions (and often being paralysed by the lack of data). Neither situation is good. The best place to be is understanding when a decision needs data (eg: one way door decision, irreversible) and when you can use more instinct to prioritise (eg: two way door, you can test and revert if it works bad). Not everything needs to be tracked, but double down on what really needs data to move forward.

Start with defining specific objectives for your product strategy and roadmap. What are your short-term and long-term goals? What problems are you trying to solve, and what opportunities are you looking to seize? Then, choose metrics that are directly tied to these objectives. For example, if your goal is to improve user engagement, relevant metrics may include user retention, daily active users, or time spent in the product.

Good product teams communicate product metrics often. Great product teams tell a strong story, and use metrics to provide rhythm and tempo. If you just communicate metrics, you'll either lose your audience's attention or they won't be able to follow so many numbers. If you just tell the story, and don't back it up with a clear connection to KPI, everyone will feel you're feeding them BS. Learn the balance between metrics and narrative, and turn your stakeholders into cheerleaders.

Bear in mind that you can tailor your communication to the specific needs and interests of different stakeholders, such as executives, investors, or department heads. Focus on what matters most to them.

I totally agree with experimenting and iterating with product metrics. It's better to feel the pulse before going all out in the wrong direction. Building products is more about customer satisfaction and value than pushing ideas and perceived solutions.

Product Metrics should exist, by default, to be experimented on. Metrics shouldn't be static: they should be going up or down, and influencing behaviours and strategy. The one metric you shouldn't be messing with is how you define product market fit. Whether that is revenue, profit, margin or NPS, make sure you're tracking it properly, and experimenting with sub-metrics (eg: leading indicators) that help move this north star up and into the right.

Remember to embrace failure as a learning opportunity. Failed experiments can provide valuable insights into user behavior and help you refine your future strategies

There are plenty of standard metrics to track. Here are two people don't often consider when measuring against competitors in MedTech. Product complaints are required to be reported to the FDA. They provide a high-level summary of the complaint publically via MAUDE. Check this database every 30-60 days and compare it with your internal product complaint report. Use Open Payments at CMS.gov to see how much your competitor pays KOLs. You will see how much they spend with a general sense of what they spend on. It may/may not be product specific.