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The Product Manager Glossary

Useful terms for product mangers and product people to learn, know and impress your friends with.

Customer Feedback

Customer feedback is crucial for businesses, offering insights directly from customers. This valuable input includes thoughts, feelings, and opinions on products, services, and brand experience. Whether positive or constructive, feedback shapes strategies, improves service, and drives innovation. It’s not just data; it fuels excellence and customer satisfaction.

Read more on Customer Feedback

User Segmentation

User segmentation in SaaS involves dividing users into groups based on behavior, demographics, and needs. This enables companies to customize offerings and enhance user satisfaction. By leveraging insights, businesses can create personalized experiences, drive loyalty, and boost success.

Customer Churn

Customer churn, or customer attrition, is a crucial metric that tracks how many customers end their relationship with a business in a specific period. Monitoring and reducing churn is vital for improving customer retention and business growth. Low churn rates show effective retention efforts, while high rates signal areas needing improvement like product satisfaction and engagement. Analyzing churn helps companies enhance customer satisfaction, loyalty, and sustainable growth.

User Feedback

User and customer feedback are valuable sources of insights from platform users. Integrating feedback into development cycles helps sculpt products that exceed expectations, enhancing usability and engagement for a loyal user base.

Product Operations

Product Operations empowers product teams to work efficiently by structuring systems and processes. It aligns product strategy with customer needs, enhancing product quality and team agility. Through data-driven decision-making, it drives product enhancements, ensuring sustainable business success.

Net Promoter Score (NPS)

The Net Promoter Score (NPS) measures customer loyalty based on likelihood to recommend. Scores range from 0-10, with Promoters (9-10) being loyal advocates, Passives (7-8) satisfied but unenthusiastic, and Detractors (0-6) unhappy customers. NPS helps identify areas for improvement to turn all customers into promoters.

Learn more about Net Promoter Score (NPS)

Customer Effort Score (CES)

The Customer Effort Score (CES) evaluates how easy it is for customers to interact with a company’s services. Low CES indicates ease, high CES signals areas needing improvement. Minimizing customer effort enhances satisfaction and loyalty, attracting new users.

Customer Satisfaction Score (CSAT)

CSAT reflects customer satisfaction levels based on experiences with a company. It’s measured through a survey question on satisfaction, calculating the percentage of top-tier responses. Tracking CSAT helps companies address concerns, enhance offerings, and boost customer happiness for lasting relationships and business success.

Product-Led Growth (PLG)

Product-Led Growth (PLG) places the product at the forefront of customer acquisition, engagement, and retention. By emphasizing the product’s value and user experience, PLG cultivates organic growth through high-quality solutions. Features like freemium models and in-product onboarding drive user value, fostering scalable business success.

Product Experience (PX)

Product Experience (PX) is the sum of interactions users have with a product, from discovery to daily use. A stellar PX surpasses expectations, driving adoption and loyalty. Companies that prioritize exceptional PX fuel product-led growth, setting the stage for lasting success in a competitive market.

Product-Qualified Leads (PQLs)

Product-qualified leads (PQLs) show strong interest in a product through interactions, hinting at future customers. Unlike traditional leads, PQLs engage with the product directly, like using a trial or key features. Identifying and prioritizing PQLs helps companies focus on potential conversions and revenue growth. Data-driven insights and real-time monitoring aid in timely engagement for business success.

Time to Value (TTV)

Time to Value (TTV) is a crucial metric for SaaS products, measuring how quickly customers can benefit. A shorter TTV leads to higher satisfaction and product value. SaaS companies focus on optimizing TTV through efficient onboarding, user-friendly design, and great support. Reducing TTV boosts customer satisfaction, retention, and loyalty, giving a competitive edge in delivering impactful solutions promptly.

Feature Adoption Rate (FAR)

Feature Adoption Rate (FAR) is a vital metric that gauges user interaction with new software features. It indicates how many users start using a feature shortly after its release. FAR reflects a feature’s relevance and value, with a high FAR showing user satisfaction and value addition. Monitoring FAR helps in data-driven decision-making for feature development and product roadmap alignment, ensuring competitive growth.

Monthly Active Users (MAU)

Account that have any activity inside your product on a daily(DAU), weekly(WAU) or monthly basis.

Signup Intent Rate

The rate of visitors performing any signup intent actions.

First Week Retention Rate

The percentage of new onboarded accounts that were still active in the first week after signup.

Viral Coefficient

Number of active users per account (for products that allow multiple users per account).

Annual Run Rate Revenue (ARRR)

ARRR is ARR plus income that isn’t assigned to a recurring subscription. Professional services or implementation costs may be included.

Average Customer Life (ACL)

The duration of the relationship between a customer and the company. Basically, the average number of days (or months) between the second a prospect becomes a customer and when the customer stops purchasing a service.

Annual Contract Value (ACV)

An average annual value from each contract. It’s basically your revenue per contract.

App Integration

App integration or just integration refers to the connection between different systems/software/platforms, allowing users to connect their existing data with multiple systems.

Average Selling Price (ASP)

The amount of revenue per customer provides.

Average Revenue Per User (ARPU)

ARPU stands for average monthly revenue recognized per user.

Break-even

It happens when the revenue generated by the customer is equal to all the money the company spent to acquire that customer.

Bookings

Bookings are the total contract worth, which is especially useful for providers offering lead generating apps and provides a fair idea of how the service is working for its clients.

Burn Rate

The burn rate is the monthly pace at which a firm burns its cash (typically venture money) before turning a profit.

BYOC

Like Bring Your Own Device (employees use their own devices), Bring Your Own Cloud refers to using 3rd party cloud apps for specific purposes instead of solely relying on a company’s IT resources.

Expansion revenue

Revenue generated from upgrades or buying more of your product.

Net Revenue Churn

Revenue lost after accounting for new and expansion revenue.

Lifetime Value (LTV)

The total net profit that a company makes from any given customer.

Product Analytics

The process of gathering and analyzing data related to how users engage with a product, aiming to understand user behavior, improve user experience, and inform product decisions and development strategies.

Customer Health Score

A metric that combines various indicators of customer engagement and satisfaction with a product or service. It aims to predict the likelihood of customer retention, identify potential churn, and highlight opportunities for improving customer relationships and business growth.

Digital Adoption Platform

A digital adoption platform (DAP) is a software layer integrated with other digital tools to guide users through the functionalities and features of these applications.

The main objective of a DAP is to facilitate seamless adoption of software applications by simplifying user onboarding, providing real-time assistance, and enhancing overall user experience with interactive guidance.

Voice of the Customer

Voice of the Customer (VoC) is a research method used by businesses to capture customers’ expectations, preferences, and aversions. This method involves gathering both qualitative and quantitative data through various channels such as surveys, interviews, feedback forms, and social media monitoring.

The primary goal of VoC is to gain a deep understanding of the customer’s experience and to use these insights to enhance product development, marketing strategies, and overall customer service.

Product Benchmarking

A process in which a company compares its product against competitors’ offerings to identify performance gaps, opportunities for enhancement, and best practices within the industry. This method enables businesses to measure their product’s features, quality, and functionalities against the highest standards in the market to inform strategic improvements and innovation.

Feature Request

A feature request is a suggestion made by users or stakeholders for new features or improvements to existing functionalities within a product or service. It represents direct feedback aimed at enhancing the user experience, addressing current limitations, or introducing innovative capabilities that meet evolving user needs.

Product Research

Product research is a systematic approach used by companies to gather insights about the market demand, competitor products, and customer preferences before developing or optimizing a product. This research helps in identifying market gaps, understanding industry trends, and assessing potential risks, thereby guiding the product development process towards creating solutions that truly meet customer needs and stand out in the marketplace.