As you study how your customers are using your product, you’ll have an endless stream of observations and data points to parse through. The challenge is that most start-ups don’t have infinite resources to act on every one. Figuring out how to tell which trends are important for you to act on is a important skill as a product leader. The key here is to dig deeper to understand what’s causing the issue, the impact of solving it and whether it’s important for your business and customers for you to solve now. Let’s look at an example metric to walk through some key steps: You have a B2C app and you notice that only 10% of users are still using your product after 30 days.
At this point you have a data point that at face value seems worth pursuing. But you’ll need to look at the full picture to fully understand what’s happening. In this example an engagement cohort chart is great to understand where in their journey your customers are dropping off (after a day? a week? a month?). You might also break your users down by segments to understand if the drop-off is across the board or if there are particular segments that are dropping off more than usual.
There are lots of ways to slice and dice your data. The key is to keep double-clicking to pinpoint the issue. For example, the solutions you build would be very different if your users are dropping off after one week vs. if they’re dropping off after 30 days. In our example let’s assume that there’s a major drop-off in engagement one week after onboarding.
Your qualitative data is only one part of the picture. Next you need to understand is what’s causing the trend. The best way to do this is to listen to your customers and/or watch them use your product. You can do this by surveying your users, doing user interviews or conducting usability testing. You’ll probably want to figure out a light-weight way to begin understanding the “why” to help you prioritize the issue, then dig deeper once you know it’s something you need to work on.
If you don’t understand the “why,” there’s a good chance you might build the wrong solutions. For example, if you notice customers are dropping off after one week, you might assume that reminder push notifications are a great way to get them re-engaged. But if the real “why” is that they didn’t like or understand your product, those push notifications are more likely to annoy customers and hurt your brand. And don’t forget to understand the inverse of the trend. In addition to researching why customers are dropping off, take a look at the customers who are continuing to use the product and try to understand what’s keeping them engaged.
Once you’ve figured out what’s happening and why, you can define the problem. Defining the problem is important because it helps to make sure you’re solving for the right thing and delivering the right solution. In our example, we could define the problem as: Customer engagement for users who’ve completed onboarding is dropping off after one week because customers don’t understand how they’re supposed to use the product.
Because we’ve defined the “what” and the “why,” we have a good starting point to figure out what solutions might help solve the problem.
Now that you have the problem defined, you should also ask yourself if it’s one that you need to solve right now.
Look at the problem you’ve defined and evaluate:- What will be the quanitative and qualitative impact of solving this problem?- Will solving it help us achieve our current company and customer goals? - Is it a higher priority than other problems / initiatives we could invest in?
Because the problem we’ve identified relates to customer engagement, it’s definitely something we’ll want to tackle at some point. But depending on context, it might not be the most important thing for us to do right now.
For example, let’s say we have a very leaky onboarding funnel where only 1% of users are making it through onboarding. If we pay for ads to acquire 1000 users and only 10 of those complete onboarding, then we’re going to burn a lot of cash acquiring users. Even if we double engagement after week one to 20%, we’d still only have 2 users who are engaging past their first week. It’s much more important for us to fix the issues with our onboarding experience first, then we can move on to addressing engagement.
After you’ve answered the questions above, you have a compelling story that you can share with key stakeholders to tell the story of what you found and why it needs to be addressed. Take them through:
Once you’ve generated buy-in, eg the project has been prioritized and resourced, then you get to dig into the real fun: figuring out how to solve the problem and tracking the impact of your work.
When you observe a trend in your product and do a good job of defining what’s happening and why, you generate the context you need to decide whether it’s something you need to invest in right now. That context ensures that you’ll spend time and resources where they will have the most impact, and you’ll be able to generate the focus and momentum to deliver the most value to your customers.
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