Finding Your Product’s Critical Event(s)

Brian Elmi
Aug 21, 2018 · 5 min read
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By now you have most likely heard the phrase “build it, they will come”. This was introduced in the 1989 movie Field of Dreams but gained popularity in tech in the early days of the dotcom boom when the players were limited and early adopters eager to experience all the web had to offer. Back then, entrepreneurs would regularly receive this terrible advice (myself included). But the days of “build it, they will come” are long gone. I am not suggesting that identifying a real problem and building a solution to alleviate the pain-point should not be pursued. However, the barriers to entry are very low these days (i.e “There is an App for that”) and simply building a product doesn’t guarantee a successful business. Once you have a solution to a problem (i.e., a Good product), building a business is a science that requires methodical analysis of data to guide the product to its ultimate success (or as Geoffry Moore would suggest, refining the product to “cross the chasm” in order to get to the mass market — early and late adopters).

That’s where having an operational dashboard that provides “real-time” view of key KPIs is critical to ensure you are making product decisions that align with your users and business goals.

Before we talk about our experience building a dashboard (in an upcoming post), it’s good to have a primer on one key metric that is often referred to as a critical event.

What’s a critical event and how to set out to find it?

A critical event is an action (or chain of actions) that when performed satisfies a user need, increases the probability that the user will come back to the product, and contributes to the business (i.e., It aligns with your core value prop). For example in the context of an ecommerce app/website, one critical event might be a users making a purchase within the first 3/7/14 days after they have been exposed to the product. In this case, the user’s need to purchase was satisfied, and depending on how the experience was, the user would come back to the product and by performing this action revenue is generated for the company. For Facebook, the critical event identified early on was “creating a connection with 5 friends”. Meaning, activity and retention rate increased once users established their first 5 connections because the value of the platform suddenly became apparent and encouraged users to become active participants. Similarly at Uber, the critical event for the drivers side is completing at least 25 trips within the first 30 days. Once you have identified your critical event, you can then design your product, marketing and promotion activities to drive users towards performing the desired action or chain of actions. However, finding this critical event is not that simple and requires a good amount of analysis and experimentation (and some patience along the day).

Steps to finding your critical event?

What to look out for?

Conclusion:

Not all events/actions are created equal. Just as defining the formula that drives your business connects the dots between the product and its business impact, finding your critical event/action connects the dots between the product and users. Before creating dashboard and reports, you have to know which events/actions within your product result in engaged users so that you can make investment in the area of the application that provides the most return.


The opinions expressed in these posts are solely my own and do not express the views or opinions of my employer.

Product Management Lessons from the Startup Trenches

In a pay-it-forward kind of way, my team and I are sharing…

Brian Elmi

Written by

Entrepreneur & Product guy | linkedin.com/in/brianelmi

Product Management Lessons from the Startup Trenches

In a pay-it-forward kind of way, my team and I are sharing what we have learned running Product Management at a startup that hopefully will be useful to you people working at a startup or a larger organization. Note that these represent our views and not necessarily our employer.

Brian Elmi

Written by

Entrepreneur & Product guy | linkedin.com/in/brianelmi

Product Management Lessons from the Startup Trenches

In a pay-it-forward kind of way, my team and I are sharing what we have learned running Product Management at a startup that hopefully will be useful to you people working at a startup or a larger organization. Note that these represent our views and not necessarily our employer.

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