What do Suicide Squad, Sex and the City, and Bad Boys II all have in common?
They were blockbuster movies that made hundreds of millions of dollars—all while being panned by the critics. Which goes to show you that while reviews are important, at the end of the day, actions can speak louder than words.
And this isn’t just true in the world of entertainment. Product managers looking to improve their products and meet business goals would do well to take note that understanding what customers are actually doing with their products provides unique insights that surveys and other customer feedback tools may miss.
The power of usage data
How do you evaluate customer usage of your product? By gathering and tracking in-product usage data. The process of analyzing this in-product data is called product usage analytics. Usage analytics will help you understand how users interact with your product and why they do the things they do.
Without real data from users, product teams are often flying blind as they try to deliver value to their users. For example, you may think that the ability to download pdfs is the key value-driver for your product. And when you ask about the Download feature in a survey, you get generally good reviews from users. But when you look at the usage data, you find that users are using the Share feature at 10x the rate of the Download. Clearly, Share is where the value is—but you never would have known that from surveys alone.
Ultimately, the success of any product is getting users to the “Aha!” moment when they experience value from the product. And product usage analytics is a tool that can help you identify that moment and guide your users toward it.
How usage data helps Product teams
Product usage analytics reveals important aspects of user behavior that help Product teams do their work.
Evaluate features. Usage analytics reveals which features users love, and which ones they don’t. It is very common for users to find value for your product in ways that you and your engineers did not anticipate. And that’s OK… as long as you have insights you can use to optimize the product experience to meet the needs of users.
Eliminate friction points. When users get confused or frustrated by a product, they usually don’t complain—they just quit. Product usage analytics will help you identify these friction points so that users can achieve value. This will also help you prevent churn and increase retention.
Segment the user base. Very often, product usage analytics will reveal that different types of users are using your product in different ways. Identifying these different groups is part of the process of segmentation. If you find different routes to value for different users, you can then target your training, onboarding, and in-product engagements accordingly to help each segment find value.
Increase stickiness. When product usage analytics show you who your power users are, in terms of both frequency and duration, you can then look for correlations within the product that are driving this stickiness. Armed with this knowledge, you can deploy tactics to steer other users toward these sticky features, which will increase retention and customer lifetime value (CLV).
Prioritize efforts. Perhaps the most obvious, but also the most important, benefit of product usage analytics is that it tells your Product team exactly where to focus their efforts. SaaS products can be very complex, so having clear, objective evidence of what users need can eliminate a lot of time-wasting, conjecture-based work.
Strategic role of usage analytics
While actions often speak louder than words, that doesn’t mean actions—or product usage analytics—should stand alone in your retention and revenue strategy. Ideally, product usage is one lens in the overall perspective that helps your organization visualize the customer journey. Customer feedback, business intelligence, and marketing analytics all have important roles to play in understanding the customer.
Business intelligence. Managing huge pools of data from a wide array of sources, including Finance, Sales, Marketing, and Finance, business intelligence can be a powerful analytical tool for answering specific questions about the larger business. This is great for broad, high-level questions, but it is not optimal for taking a deep dive, and it is not particularly nimble. For the rapid, exploratory process of product development, product usage analysis is a suitable tool.
Market analytics. Tools like Google Analytics tell you a lot about how customers find your product (acquisition) and what they do once they get there (attribution). This is valuable information for designing marketing campaigns and directing sales, but it doesn’t necessarily tell you whether customers are finding value and joy from your product; however, it does help you understand the customer journey, and it is important for Product teams to understand what the “ways in” are for new users.
How Gainsight PX powers product usage analytics
To successfully implement product usage analytics, you have to be able to manipulate data in an agile, intuitive manner. That means gathering accurate information on user behavior from within the product. Once you have the right data, you have to identify (or create) metrics that will reflect your product’s goals, ie, their effectiveness at achieving value for customers. Using these metrics, you can set benchmarks and begin tracking their performance over time. With this information, your Product team can start making the changes to the product as needed.
The Gainsight PX platform combines all these functionalities in one place. To learn more about how Gainsight can help you, check out our website and request a demo.
