Key Metrics for Product Managers That Should Not Be Ignored

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Ignoring data and metrics in today’s world means dooming your business and products to extinction. Here are some of the top reasons why metrics should not be ignored:

• The opportunity to understand customer behavior better, tailoring services and extracting more value
• The risk of competitors doing a better job
• Prioritizing development and investing resources where they matter (depending on organization goals)

Essentially, building products or features that users want to engage with and pay for, in some form, gets a little easier when you can quantify the effect of your efforts.

In broad terms, there are two forms of metrics, exploratory and reporting, both important in their own respects. Usually, exploratory metrics are looked at to spot interesting behaviors or gain new insights and are not usually reported to investors. On the other hand, reporting metrics are those which are more focused and constantly tracked.

Good metrics should be understandable and simple, in rate/ratio format, explain correlation/causality, and must be trackable over time.

Let’s have a look at some frameworks that would help you develop reporting metrics for your firm:

The Pirate Framework (Say AARRR…!)

Developed by Dave Mcclure, pirate metrics break down the product user’s lifecycle, explaining the right metrics to track. The acronym AARRR details out the framework as:

As an example, let’s have a look at pirate metrics for Facebook:

Acquisition

Activation

NOTE: All pointers should all be converted to formats suitable to the business (play around with averages, rates, ratios, per user v/s overall stats, varying time periods to find the right fit).

This was just a quick dive into what metrics Facebook could possibly be tracking. There might be tons of other things they monitor, depending upon the intent and tracking capabilities.

In addition to that, Facebook is known for its high focus on engagement, some of which I covered in retention. They utilize specialized tactics, driving from human psychology to get users hooked to their product. You can read more about it in this book, that I highly recommend.

The HEART Framework

This framework was designed by Kerry Rodden, Hilary Hutchinson, and Xin Fu, from Google’s research team (User Experience). HEART is an acronym for Happiness, Engagement, Adoption, Retention and Task Success.

I like this framework because it's more user-centric and takes into account subjective aspects like user satisfaction.

As an example, I picked Workato, a business integration and process automatization platform startup. I like what they’re doing and thought an untraditional example would spice things up.

Now that we have some clarity on what kind of metrics we can and should employ, here are some additional tools for monitoring user behavior:

1. Google Analytics: Pretty common for analyzing the return on your advertising investments.
2. Crazy Egg: Delivers click maps, heat maps, and scroll reports, which is vital information in understanding user flows, frustrations, testing new features, etc.
3. KISS metrics: Segments your users on the basis of behavior, facilitating targeted campaigns to the right group.
4. Mixpanel: Offering similar to KISS metrics.
5. Optimizely: Helps you run experiments for usability testing.
6. Segment: Functions as a hub, delivering all customer data in one place.

Some Parting Words of Wisdom:

1. You don’t have to monitor everything. Put in extra initial effort to narrow down what’s most relevant to the business, and cut through the noise.
2. Depending upon the metric, involve designers and engineers early on in the decision making process.