Creating a product that works is one thing, but continually making it the best it can be is another. It’s extremely important to have the right tools and insights you need in order to measure how well your product performs, see where it’s lacking, and how your users interact with it. That’s exactly what product analytics is all about.
Already, product-led companies are seeing the impact product analytics can have on ensuring continuous product success. In fact, the product analytics market has reached a huge $6 billion in value and is estimated to reach over €16 billion in just 5 years’ time. So what exactly is product analytics? What could it do for your product-led company?
Today, you’ll learn all about it and how to track specific metrics to ultimately guarantee product-led growth.
- What is Product Analytics?
- Why is tracking it so important?
- Who benefits from tracking Product Analytics metrics?
- The difference between Product Analytics and Marketing Analytics
- Examples of Product Analytics to track
- Use a Product Success Platform to improve Product Experience
Ready? Let’s dive in.
What is Product Analytics?
Product analytics is a method that provides insights into how users interact with your product. Product Managers and Product Teams can use this data to assess the performance of their products and ensure that they are providing the right digital experience for users that they intended.
As a product-led company, you want to have the exact data you need to focus on improving your product. After all, product analytics = product success – if your analytics are positive, then your product is doing its job well!
Now that we know what product analytics is, let’s find out why it’s essential for you to start tracking them.
Why is tracking Product Analytics important?
There is no denying it: products are complex. And if you want your product to be successful and serve your users as you intended it, you’ll need to actively search for ways to make it the best it can be.
That’s why tracking your numbers is so useful. It helps with:
- Optimizing the performance of your product
- Diagnosing problems that may occur
- Correlating customer activity with long-term value
- Ensuring everyone is on the same page
But to really understand why it’s important to track those metrics, let’s see who it affects and who benefits most from them.
Who benefits from tracking Product Analytics metrics?
In short, everyone on your team benefits from product analytics. After all, it’s what gives you the data you need to adjust your product to better suit your user’s needs.
So what will that look like for you? Here’s how you might use product analytics as part of your role:
- Product Manager: you will have a better understanding of what your users are really doing, and will be able to develop ideas and design better experiences to captivate them.
- Marketing Manager: you can better understand their behavior, and see what urges users to make certain decisions. Knowing what users do helps you sell the products better.
- Customer Success: customers are happy when your products are easy to use. So thanks to product analytics, you’ll learn how to monitor their engagement, what features they favor, and inform them on how they can get the most out of your product.
- Developers and UX Designers: you can become more aware of how users interact with your product, and so you can better identify and fix design and implementation issues. Additionally, by identifying the characteristics that people find confusing, you can make the necessary adjustments.
It’s important to remember that product analytics are not the same as marketing analytics, although they are both integral to learning more about your users and your product. Let’s take a look at exactly how they are different.
The difference between Product Analytics and Marketing Analytics
The primary difference is that marketing analytics focuses on turning visitors into future users. On the other hand, product analytics focuses on the user journey within the product in a meaningful way, so that they remain an active user.
Product analytics is all about giving detailed data on various parts of their experience. If your users keep getting stuck at certain points in their journey, product analytics takes notice of that.
So what data can you expect to find with product analytics? Let’s explore some of the most important metrics to track for product-led growth!
Examples of Product Analytics to track
There are so many different metrics you can track when it comes to product analytics. Although the majority of these are super important, here are our top three when aiming for real product-led growth.
1. TTV (Time to Value)
Time to value refers to how much time it takes your customers to reach their ‘aha’ moment after purchasing your product. A short TTV means your product is successful at showcasing its value straight away. Read more about TTV and how to reduce it.
2. ARPU (Average Revenue Per Unit)
Average Revenue Per Unit (ARPU) indicates if your product is profitable based on the amount of money it generates from each user or subscriber. The higher the ARPU, the better. Read more about ARPU and how to track it.
3. Churn Rate
Churn Rate is a super important metric that shows you exactly when and where users are churning or no longer using your product. A high churn rate means your product simply isn’t good enough for users. Read more about churn and how to reduce it.
Use a Product Success Platform to improve Product Experience
There are tons of different metrics you can track, which will vary according to your role and needs. Although tools like Google Analytics are a great free tool to monitor these metrics, it’s not so great to understand the next steps to actually improve your product.
We recommend using a product success platform to do it all for you. FROGED uses product flows so you can optimize your product based on event tracking and user behavior conditions to reduce your TTV. You can track the product analytic metrics above and more, all in one platform with additional dedicated support.
Ensure Product-Led Growth by Tracking
PLG is guaranteed when you focus on one thing – making sure your product is the best it can be by giving users exactly what they need. You can achieve exactly that using product analytics – it provides insights into how users interact with your tool, what they like, and what obstacles they run into. You can use this data to prevent any future friction or dissatisfaction and keep your users happy!
Ready to start using product analytics to level up your product today? Book a demo with FROGED today to see how easy it can really be!