Author : Aniket Pathak
Date : 05 Jun 2023
This is the second article in my Product series. If you wish to read the previous article please click on Survival bias in product management.
In this article, we will try to look at "What is a metric and do you have the right one?". Product metric is an interesting area to study and to be aware of, especially if you are managing, selling, or servicing some sort of product, tool, or service. The aim here is not to get into an academic discussion but help you understand the question. I will be covering the product success metric in 3 parts, and I hope you will find Part 1 enjoyable.
So what are we talking about?
Do you remember when last time you said "Today was a good day"? It could be today or a few days before. There was something on that day you felt or did which felt good, but what? What if you want tomorrow to be a good day as well, or even better what if you figure out if a day in the future will be good or bad for you?
To know that you need to check why the day was good.
Once you identify a few factors you can select your most important criteria or select a few and define that as a standard e.g. normally if a day is sunny and you have fewer meetings you feel good. So you can keep an eye on the weather and if a day is going to be sunny, you can adjust your schedule and try to make a good day.
What you just did is, define a metric to measure a day. This may be a very simple example but the process remains the same for any complex or simple product, task, or service. This measurement or metric helps you to arrive at a result, which helps you understand the parameters needed for your product to be successful. This is all possible only if you measure the performance and to measure you need some metric to compare.
Any task, activity, product, or service you perform or create is always measured to gauge its performance. Measuring performance means there will be some benchmark or standard to compare the result of the task, which will help you to know if the result, observation, or performance was good or not up to the mark.
I hope you got the point here. All we are referring to is a metrics or measurements which help you do all these analyses.
Isn't measuring success a common sense ?
Surprisingly not, let me explain. From a commercial product point of view, all companies and departments to know whether a product is successful or not, and if their revenue is good or bad. In most cases, everything is defined either by sales numbers or revenue. More money means the product is doing good and if not then it's performing badly. It's not a bad metric, but may not be the right one for your product. The question is before you start measuring do you want against what you are measuring?
What questions can we ask:
Which factor matters to you money or customer feedback?
Which drink is better?
Which drink will survive for a longer time?
Now if you consider money as the only factor Apple drink is doing better and Orange is not, but if you compare the same product using customer feedback, it's very clear customer love Orange drink.
The same product looked through different matric can give you a completely different picture. The important question is, do you understand these results, and which metric is more important to you? If currently you don't know what metric you can follow, this is an easy way to find out which metric is for you.
So what is the right metric ?
Ideally, your product success metric needs to be well defined and defined right at the time of development and design. The whole objective because of which the product came into existence defines its metric. But if you already rolled out a product and are not sure about the metric there is a process to find it.
You can google it and find out various ways of creating a success metric and get technical about it. My aim here is to just give you enough information about metrics to get you curious. No one can measure your product better than you, it is your journey to find what is the best metric for you.
Quick example
Let's consider a payment aggregator or processing product like Visa, Mastercard, etc. We all used it directly or indirectly, it is the company logo on your debit or credit card. So what kind of metric will you use for such a product?
Which metric will you use to review product performance ??
Will you choose only one or multiple metric ??
It can be a simple or difficult question and that's why you need a well-defined metric before you commercialized a product. You can not release a product and check which areas it is performing well and defined that as a metric. In a sense, you try to be not reactive in measuring the product performance, you need to be very proactive in defining the metric.
The question you need to ask -
Is the performance metric aligned with Product objectives?
Do you have a Quantifiable metric?
Can you test your metric?
North Star
In the product management space, there is a concept of "North Star" and it is all about defining your success metric. Its a very interesting topic and if you want to define a product metric its a the best approach to define it.
In brief, why it is called North Star is, looking at the north start helps you get direction. So when you define the North start metric it helps you to give direction to your company or product.
I don't want to go into technicalities of North start metric, as there are enough good article out there which can help you understand the process and concept behind it.
For more details please read :- https://cxl.com/blog/north-star-metric/
Conclusion
Hope you got some idea of why you need a success metric and how important it is to clearly define the same.
All products deserved to be measured with the right metric. It's like saying you can't judge all mobile phone models through the number of sales. some mobile is only for games, some are for privacy, and some are for general use. You need to define a metric that fits into their play area and not a generic one. That applies to any product, as they are created to achieve a specific purpose and you should only judge them through the right metric.
In Part 2, we will see how you can implement this metric and test your product's success.
Some useful article :
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