Looking for some product management KPIs and metrics?
Product management KPIs and metrics help product managers monitor their performance to ensure that the company is improving and working towards a successful product strategy.
But what are product management KPIs and metrics, and how can they help you?
And more importantly, which metrics should you be tracking?
In this article, we’ll discuss everything you need to know about product management KPIs and take a look at the fifteen best product management metrics you need to track today. We’ll also cover the best way to track product management metrics in 2023.
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Let’s get going!
Summarize this article for me pleaseWhat’s The Difference Between KPIs And Product Metrics?
KPI stands for key performance indicator.
KPIs determine if your business is achieving its core business targets and objectives.
What about metrics?
Metrics can also serve as a performance indicator that helps you determine if your business is achieving its goals.
Can’t tell them apart?
Here’s the difference between the two:
Unlike KPIs, metrics deal with a larger scope of business goals and not only key objectives.
Here’s what we mean:
- If a metric targets a key business objective, it’s a KPI
- If a metric covers any sort of business goal that isn’t a core objective, then it’s just called a metric
Here’s an example of a KPI:
Increase new customer trials by 23% in 2021, representing a growth of 18 trials per week to 21 trials per week.
Here’s an example of a metric:
Organic inbound website traffic
What’s different between the two is that the first example is specific and has a desired outcome. The second example also contributes to your overall strategy, but it’s not as clearly defined or related to a particular outcome.
Remember, every KPI is a metric, but not every metric is a KPI.
However, we’re not done yet…
There are two types of metrics:
- An actionable metric is specific and has repeatable actions that lead to results
- Vanity metrics make your product look good, but offer no insight into how you got there and what you should do next (the number of Instagram likes)
For a more detailed look, check out KPIs vs metrics: what they are and how to track them.
Summarize this article for me please15 Key Product Management KPIs And Metrics You Need To Track
To help you achieve all your goals as a product manager, we’ve compiled a list of product management metrics that you need to track:
Customer KPIs
Customer KPIs are all about your customers.
These product metrics keep track of how satisfied your customers are and how much value they bring to your company.
1. Customer satisfaction
If you want to find out if your customers are happy, then customer satisfaction is the right metric for you. You can find this out by sending out surveys that target specific areas you think need improvement.
The responses let you know which customers are unhappy, and need some extra attention from your product management teams.
Here’s a simple way you can calculate it:
Customer satisfaction = the number of positive responses ÷ the number of total responses x 100
If you’re using the Customer Satisfaction Score (CSAT), customers rank a specific product or service on a scale of 1-5, with 5 being “very satisfied” and 1 being “very unsatisfied.” If the product meets customer expectations, then you’ll get a higher score.
The composite Customer Satisfaction Score is calculated by summing the score and dividing it by the number of respondents.
However if you’re looking to visualize the CSAT as a percentage of “satisfied” customers, you will divide the total number of 4s and 5s (the “satisfied” and “very satisfied” respondents) by the total number of respondents.
Unlike the Net Promoter Score, Customer Satisfaction Score evaluates satisfaction with a particular feature rather than the company as a whole.
Bonus: Learn how AI can help you reach your product management goals!
2. Retention rate
Customer retention rate is a key metric for any customer success manager to monitor.
Why?
Retention rate measures how many customers stayed with your product over a specific period of time. For example, you can base your calculations on a number of annual membership extensions or product purchases.
While the retention rate focuses on loyal customers, churn rate takes a look at those who may have moved on to a competitor’s product.
Here’s you can calculate both of them:
Retention rate = Customers at the end of the specific period – new customers ÷ customers at the start of the specific period x 100
Churn rate: Customer churn rate = customers lost ÷ total customers
3. Conversion rate
Conversion rate is a sales and marketing metric, right?
Not necessarily.
You know those apps that give you a free trial for a few days?
Once that trial is over, you may decide to leave the app behind or start paying for it because it was actually incredibly life-changing.
That’s what your conversion rate could measure.
It can track how long it takes free trial users or sample users to convert into paying customers.
This will help you predict how many paying customers you’ll get from a specific number of free trial users.
Here’s how you can calculate it:
Conversion rate = the number of paying customers ÷ the number of trial users
4. Customer lifetime value
This KPI calculates how much revenue your company can expect from your customers in the long run.
Sometimes, it can include the average revenue provided by one user before they decide to cancel their subscription.
To determine customer lifetime value, you need to determine how long a customer uses your product and the average revenue that the user brings.
Here’s how you can calculate it:
Customer lifetime value = average revenue per user x average customer lifetime
5. Customer acquisition cost
This is one of the most important SaaS metrics a product manager needs to look at.
Why?
It takes a look at all the costs your SaaS company incurred while trying to secure a new customer in a specific period of time.
What kind of costs are we talking about here?
This can include:
- Salaries
- Marketing campaigns
- Sales team expenses
- Advertising costs
It takes some to get some, right?
Here’s how you can calculate it:
Customer acquisition cost = sales and marketing spendings for a period of time ÷ total number of customers acquired over a period of time
You can use this marketing metric to determine how much you should spend during customer acquisition. You can also use customer acquisition costs to decide whether or not it’s time to change customer acquisition channels or reconsider your product marketing strategy and pricing model.
Use this Customer Sales KPI template by ClickUp to track your customer KPIs.
User Engagement KPIs
User engagement metrics measure whether users find value in your product.
Engagement can be measured by logins, downloads, and how long users stay on your website.
6. Daily active user and monthly active user count
How many active daily and monthly users you have is a crucial product usage metric.
Why?
It shows you if your product is engaging enough.
When defining active users, you need to choose a duration and interaction. If a user performs that interaction within the given time period, they are active. If they don’t, you can consider them inactive users.
The Daily active user and monthly active user count keep track of unique users who visit your digital product on a daily or monthly basis. 📱
Let’s take a look at both:
- Daily active user: the number of active users per day
- Monthly active user: the number of active users per month
Compare your active users (daily/monthly) against the total users you have for an accurate view of how engaging your product is!
Here’s how you can calculate it:
Daily active user/monthly active user = the number of daily/monthly active users ÷ total number of daily/ monthly active users
7. Session duration
This KPI tracks how long users spend on digital products like games, apps and online shopping sites.
For example, our session duration for watching this little guy is forever. 🥺
This metric is essential since it shows you the value of your product’s content. Ultimately, it will affect customer retention rate and customer loyalty.
For example, if you have a website, session duration can’t be improved through keyword stuffing or more clickbait headlines.
It can only be improved by including more videos, links and improving the overall look and feel of your website.
After all, time is money, right?
Here’s how you can calculate it:
Session duration = (take the average of the answer): the total time users spend on your product ÷ the number of users
Note: You can also use Google Analytics to calculate this number.
8. Number of user actions per session
This KPI tracks what users do when they’re on your website and app. This includes any action they take and the features they use.
This is a powerful KPI that can guide you in your feature adoption strategy.
Remember when we discussed customer satisfaction?
Throwing in questions about favorite features and feature suggestions will also give you some insight into which features your users would like on your product roadmap so that you could say to them…
Product Quality KPIs
Product quality metrics will create a foundation to establish goals for your product development team. Product managers should pay attention to these management metrics and KPIs to ensure product success.
Tracking product quality KPIs will result in continuous improvement, reduction in testing and defects, and fewer customer issues.
Learn how to use AI tools for product management!
9. Testing and Velocity KPI
Testing is at the heart of product releases. Product managers can track a number of KPIs such as the number of tests completed successfully and the percent of automated tests.
By working with the QA and testing team, the product team can validate the features and systems of the product increment and create goals around continuous improvement.
One metric is the Velocity KPI, which keeps track of the total number of tests executed.
Here’s how you calculate the Velocity KPI:
Velocity KPI = automated tests + manual tests
10. Defects and Detection Effectiveness
As a product manager, you can focus on testing and defects in a number of ways. For example, you can track the number of failed tests, which is the defect rate KPI. Within the broad category of defects, you can also track active defects, rejected defects or severe defects.
It’s also important to keep track of how well your team identifies and uncovers defects. The Defect Detection Effectiveness (DDE) is a metric that gauges the percentage of defects your team catches against the overall defects of the product.
If the DDE increases over time, this is good news as it indicates the team is catching more bugs and defects before releasing the product.
Here’s how you can calculate Defect Detection Effectiveness:
DDE = the number of defects identified by team ÷ the sum of all defects (identified by team and end users) X 100
11. Support Ticket Escalations
This critical set of product management metrics will help you keep a pulse on product quality after release. Tickets are generally escalated in situations where the first line of support was not able to resolve an issue.
Customer chats and calls, Twitter posts, and blog comments can count toward this number, but are much harder to track.
When the escalation rate is high, you as the product manager should investigate if there is an ongoing problem with your current feature or product.
You can keep track of the support escalation rate with this formula:
Support escalation rate = the number of tickets escalated from first tier ÷ the total number of support tickets.
Business Performance KPIs
Business performance metrics measure the profitability of your business.
To put it simply, it deals mostly with money.
12. Monthly recurring revenue
Monthly recurring revenue is a metric commonly used by SaaS companies to track the profitability of their company. 💸
It calculates the money your product brings in on a monthly basis, so it’s the revenue your SaaS business can expect every month.
Here’s how you can calculate it:
Monthly recurring revenue = average revenue per user on a monthly basis x the total number of users in a given month
13. Percentage of revenue from new products
This is a product development KPI that tracks the total revenue brought in by selling new products.
This way, you can see how well your new products are contributing to the overall performance of the business.
If your new product isn’t contributing much, you could try launching a product update 🚀 or conducting more market research.
Here’s how you can calculate it:
Percentage of revenue from new products = total revenue ÷ revenue from the new products
14. Average revenue per user
The average revenue per user is a KPI commonly used by SaaS businesses. It tracks how much money a company can expect to receive from an individual user.
This KPI tells you whether or not you’re targeting the right audience and if you’ve priced your product correctly.
Here’s how you can calculate it:
Average revenue per user = total revenue generated during period ÷ the number of users during the same period
15. Net promoter score
Net promoter score is a KPI that measures the number of existing customers who are likely to promote your product to someone else. 👍
It also tracks the number of customers who just aren’t that into your product 🙅 (detractors).
A simple way to do this is by asking customers to rank your product from 0–10.
You can consider them a promoter if they rank your product from 7–10 and detractors if they rank it between 0–6.
In doing so, your product team can find the reason behind the lack of loyalty in your detractors and improve the overall product experience for all your customers.
Here’s how you can calculate it:
Net promoter score = % of promoters – % of detractors
Summarize this article for me pleaseHow to Track Product Management KPIs
Great, so you now know which product management KPIs to track.
To improve your performance and actually be successful, you need a tool that will help you track and measure those KPIs.
Product management KPI tools, like ClickUp, have features like built-in reporting, intuitive Dashboards and more!
Use this ClickUp KPI Template to track your team’s KPIs.
Here’s a closer look at why ClickUp has the perfect features for your product management KPIs:
1. Goals
You can’t improve your performance and reach your product vision without setting Goals and Targets, right?
Well, you could.
But we doubt you’ll open any doors of opportunity.
ClickUp Goals can be split into smaller Targets.
Targets are your objectives, and once you complete them, you reach your Goal. Your Target progress will also be automatically updated in ClickUp.
So how does this help you with managing product management KPIs?
You get to customize the metrics you use to track those objectives such as:
- Numbers: numerical figures such as churn rate or bounce rate
- True or false: to check if something has been done or not, for example, inventory management
- Currency: for product metrics like monthly recurring revenue or gross margin
- Tasks: to track performance based on product task completions
2. Dashboards
ClickUp Dashboards give you a high-level overview of all that’s happening in your workspace.
It’s the perfect solution for any product leader who needs to oversee their product portfolio.
Unlike Google Sheets or Excel dashboards, each KPI Dashboard contains tons of Custom Widgets so you can view your product metrics the way you want to.
Here’s a list of some of the widgets you can add to your product KPI dashboard:
- Bar Chart 📊
- Line Chart 📉
- Pie Chart 🥧
- Battery Chart🔋
- Calculations📝
3. Team Reports
You can also add Team Reports as Widgets to your Dashboards.
Here are some of the Table Widgets you’ll get:
- Completed Report: see the number of tasks each team member has completed
- Worked On: see how many tasks each member worked on a specific day, week, or month
- Workspace Points: gamify your product tasks so you can identify the top performers in your product team
- Who’s Behind: determine which team members need a little more motivation by seeing the number of uncleared notifications and overdue tasks
Bonus: Check out what a KPI report is & learn these common project management KPIs!
Summarize this article for me pleaseTime To Execute Your Product Strategy 🎯
Product management KPIs help you manage your product strategy with ease.
They’re the core success metrics that every company needs to execute its goals.
But simply choosing a few KPIs isn’t gonna cut it. 💇
You need to track them too!
Luckily, ClickUp lets you track your KPIs and more.
That’s right, ClickUp has everything you need to manage your product management KPIs and has features for product ideation and execution.
Whether it’s Task Automations or Project Templates, ClickUp has everything you need!
Get ClickUp for free today so your customers can feel like this about your product:
Everything you need to stay organized and get work done.
