Receptive’s SaaS Acronym & Jargon Cheat Sheet (Part 2)
A resource for new product managers
When I first entered the world of product management, I was overwhelmed by the amount of jargon and acronyms. SaaS has a lot of acronyms and jargon. Like, a lot.
The first thing any prospective product manager has to learn will be the three cardinal rules of SaaS:
- Religiously follow Dilbert;
- bring donuts to everything;
- there are apparently magical unicorns and they are everything.
The second is being able to identify your whales from unicorns. So to (hopefully) make your lives a little easier, I give you a SaaS acronym and jargon cheat sheet.
HiPPOs, Whales and Unicorns
There are three animals to watch out for in SaaS.
First there’s the HiPPO, aka the Highest Paid Person’s Opinion.
“The HiPPO can be a customer, an internal user, a colleague, or your boss; they are high-status individuals that are accustomed to setting the agenda and having their opinions heard and acted upon.”
There are also whales. They’re big customers that will usually burden your systems far more than other customers, and if you’re not careful, will tow you around and smash your ship into some rocks.
Finally there are Unicorns. Magical, mystical unicorns. They’re everything you’d ever hoped for, and everything you need. They are your ideal customers. But like unicorns, they’re usually a thing of myth.
While Minimum Viable Product can also be classed as a development approach, it reflects a much wider part of business strategy. You’ll often hear SaaS companies repeating a quote from LinkedIn founder Reid Hoffman:
“If you are not embarrassed by the first version of your product, you’ve launched too late.”
The MVP approach dictates you build just enough to make it usable, with the idea of continuously iterating on it as it’s purpose becomes more validated.
“A business model and collection of tactical methods that emphasize eliminating non-value added activities (waste) while delivering quality products on time at least cost with greater efficiency”
Going in on your own! Bootstrapped companies are self funding, with no outside investments. MVPs are often bootstrapped.
One of the most dreaded words in SaaS. Used to describe the rate at which customers cancel their subscriptions. Typically recorded as a percentage of total customers.
A phrase to describe when your product has too many features, often to the point where many of them have become unnecessary or remain unused by customers.
Customer Acquisition Cost. How much does it cost to land new customers
Average Revenue Per User. How much each user is worth to your company
Unique Selling Proposition. What makes you different?
Conversation Rate Optimization. How many visitors become customers/do what you want them to do?
Return on Investment. No one wants to waste time or money in SaaS on something that won’t give them better returns!