It is virtually impossible to overestimate the importance of metrics in the lifecycle of any product. Product metrics, quite simply, tell you what’s happening with your product. Metrics, of course, will vary from industry to industry, product to product, and market to market. For example, if it’s a social platform, you’ll be interested in engagement numbers, if it’s a business intelligence (BI) tool, you’ll want to know how efficiently things are running. What makes any set of metrics so important is that they tell you what users are doing with your product – and users are the ones who will steer your product’s evolution. Unless you know how they are interacting with it, how they want to use it, and what’s important to them, you can’t make good product decisions to keep it viable.
Metrics, regardless of your product or industry, can be divided into two major groups: long-term (strategic) and short-term (tactical or actionable). Long-term metrics are those used to measure the strategic business aspects of your product’s usage – how is consumer demand or the competitive landscape changing for your product? Short-term product metrics are valuable for making product modifications based on user feedback about a specific problem, feature, or function. These metrics might be used until a specific issue has been resolved. Or they may be used to gather predictive information that will enable you to make early course corrections with your product to head off potential problems before they arise.
If you’re new to metrics utilization, or you need a refresher, there are five basic steps to developing product metrics:
- Define the metrics. To get the most from your metrics keep them simple, understandable, and relevant. One proven method to keep your metrics on track is to use the SMART methodology – make them Specific, Measurable, Achievable, Relevant, and Time-based.
- Understand the data you need and how to collect it. It’s one thing to know what data you need, but it’s quite another to figure out how to get it. It’s vital to be able to collect data that’s consistent and reliable so that the analysis will be accurate and valuable.
- Get buy-in. Metrics won’t work unless you have buy-in from all of the product’s stakeholders. Everyone needs to agree on what you’re measuring and why.
- Measure and share results. Data is not the same thing as knowledge. If you’re going to take the time to establish metrics and collect data, it’s important to then analyze it and share the results to ensure that your product continues to perform as it should.
- Update your metrics Any metrics need to evolve over time, based on market conditions and your product’s lifecycle. After all, how can you accurately assess your product’s fit in the marketplace if your product metrics are outdated?
Selecting the right metrics is crucial for both successful product development and to help ensure that your product stays relevant and valuable in the future. Remember to keep the number of metrics manageable – a half dozen or so — and revise or replace them when they’re no longer effective.