Product marketing’s a complex role that requires a lot of different skills and knowledge to get right. It’s establishing itself as an integral part of businesses and if it's done poorly, this can lead to an increase in customer churn, lost sales, missed opportunities, and a decrease in profit.
To ensure that your product marketing efforts are successful, you should create a strong set of goals and objectives that you want to achieve. This is where OKRs and metrics come in handy.
In this article, we’ll provide answers to fundamental questions, such as:
- What are OKRs & metrics and why are they important?
- Essential product marketing OKRs and metrics.
- How to optimize your use of objectives and analytics.
- Challenges with using OKRs and metrics, and how to overcome them.
What are OKRs?
OKR stands for Objectives and Key Results. They’re an effective tool for both personal and professional development, used to measure product success, set specific project goals, and track progress towards those goals.
Why should you use them?
OKRs are incredibly important within the PMM community. There’s an entire principle dedicated to the importance of setting OKRs in the Product Marketing Manifesto. There are many reasons why you should be using OKRs within your product marketing strategy. For instance, they:
Bring clarity to your goals
Ideally, an organization should have an overarching objective that everyone within the business should be working towards. Then, individual teams should be setting their objectives in terms of achieving that overall goal.
So, establishing strong OKRs for both the organization and your team will give you a clearer vision as to what you’re aiming to achieve and simplify the product marketing process.
Inspire motivation within your team
Giving your team OKRs provides them with a sense of purpose and an actual goal to work towards. This’ll increase in-house collaboration and overall motivation to achieve success.
Help align purpose and strategy with execution
OKRs help you establish a solid foundation for the product marketing process. With them, you can identify the purpose of your product, the strategies you’ll use to achieve success, and then how they’ll work together to simplify the actual execution of your project.
What are metrics?
Product marketing metrics are a quantifiable way of tracking product performance and a great way of identifying the right ways of measuring your success. There are five main metric categories that you should be using:
Leads: Used to measure how the organization is performing in the market, and are very helpful for sourcing opportunities for potential customers.
Revenue: Helps you to analyze your sales and product revenue, and how to increase them.
Conversion: Examines how effectively and how often your online audience converts into paying customers.
Engagement: Analyzes how often your customers are interacting with your product, and essentially how effective your brand campaigns are.
Traffic: Measures your website and how often customers are visiting, leaving, bouncing, etc. Links within your website help to see which areas of your site are performing better than others.
Why are metrics and analytics important?
Product marketing requires knowledge of technical details, design processes, marketing strategies, customer service, and much more; there are a variety of hard and soft skills deemed requisite to the profession, including the ability to decipher metrics and analytics.
A PMM has to juggle multiple tasks at once while keeping an eye on the future, whilst keeping their team motivated and productive throughout the entire project lifecycle. Without proper metrics and analytics, it can be hard to stay on track with your projects. But with them, you can:
- Provide clarity on what you want to achieve,
- Drive accountability by measuring which areas are most successful,
- Identify what changes and goals you need to set for success,
- Measure how well different product marketing strategies are working (e.g. messaging),
- Correct existing projects,
- Increase/secure budget for current and future projects, and
- Improve quality and productivity of product, then increasing UX, customer satisfaction, and retention rates.
Essential product marketing OKRs and metrics
We have compiled a list of what we consider the most essential product marketing OKRs and metrics within product marketing that’ll boost your projects, help to prevent customer churn, and increase sales.
Remember, there isn’t a blanket approach that can be applied to the world of OKRs and metrics; you need to choose metrics to suit your sellers.
Click-through rates: This is the ratio between the number of clicks on a specific Call-to-Action (CTA) and the number of times people were exposed to the link. Click-through rates are important because they help you understand what works with your product when it comes to reaching your target audience.
Cost per Lead (CPL): This metric measures how cost-effective your product marketing campaigns are in terms of producing new leads (people interested in your product) for your sales team. Calculating the CPL helps to establish a solid budget to spend on acquiring new customers. This’ll then, in turn, help improve the rate at which you gain new customers.
ARR/MRR: These stand for Annual Recurring Revenue and Monthly Recurring Revenue, respectively. They measure the recurring amount of money your company expects on a yearly (ARR) or monthly (MRR) basis. These metrics are perfect for when you have a subscription-based product and provide an insight into the efficiency of your business and product marketing techniques.
ARPU/ARPA: Average Revenue Per User or Average Revenue Per Account helps you to measure your company’s revenue based on how many users or accounts you have. They’re often used synonymously, but sometimes this isn’t helpful, as one person could have multiple accounts. Either way, these metrics are important in helping you identify profitability, and which of your products generate the most revenue.
Win rate: This measures the number of successful sales that your organization has throughout its sales cycle. This is, of course, extremely important in identifying areas of improvement with your product, understanding your current finances, and also helping to predict future sales.
Bailey Haslam, Marketing Director at Clozd, wrote an interesting article on how win-loss analysis can be used to improve company performance and revenue.
Conversion rates: This is calculated through the number of conversions -or the number of times your CTA’s responded to - divided by the total number of visitors. Conversion rates are important to measure because this metric highlights how many prospects you’re successfully turning to fully-fledged customers.
You get to see who’s genuinely interested in your product, and how many go through with the sale vs how many don’t. You can improve this rate through a process called conversion rate optimization (CRO).
Cost per acquisition (CPA): This financial metric measures how much it takes for a business to acquire a single customer. CPA’s essential if you’re running an online business because it determines your return on investment (ROI) and creates a direct link between revenue and how your product marketing campaigns impact it.
Churn/retention rates: Churn and retention rates are arguably the most popular metrics to measure within product marketing. They refer to the rate at which a customer either discontinues (churn) or continues (retention) business with you. These are incredibly important for your business to know because lost customers mean lost revenue/sales.
A churn rate will tell you that you need to identify why customers are leaving, and try to fix it. Conversely, in the case of a retention rate, you’d need to find what’s so good about your product/business that’s prompting customers to remain loyal to your brand.
Time on Page: This metric measures the amount of time a customer spends on pages within your website. You can analyze how interested your customer is in your content by comparing how long they’re on the page, with how long it would on average take to actually read the information.
Traffic sources: This helps to track where your traffic’s coming from. For example, via organic search, direct links, social media, etc. Measuring where the visits are occurring most helps you to optimize an effective strategy to continue improving your traffic rates.
Bounce rate: This metric measures how quickly visitors leave your website after arriving. Though it won’t tell you why they’re leaving so quickly, it’ll give you a better indication of what’s working with how you market your product.
Integrations such as online heat maps can be integrated into your website to give you an impression of how people are using your site.
How to optimize your use of OKRs and metrics.
So how do you know if you’re achieving your OKRs or if you’re using metrics effectively?
We have a checklist that’ll help you to ensure you’re using both methods as you possibly can.
- Identify the methods you’re already using. This’ll help you see which areas you’re lacking in, and motivate you to find ones to compensate.
- Find a metric - or OKR- that’ll fill in the gap you’ve found. By doing this, you’re ensuring that you’re covering as many bases as you can, which gives you a greater chance of discovering many potential areas that need improvement.
- Continually and consistently track and review them. It’s okay to put these metrics in place, but you need to truly analyze the data you’re receiving from them consistently to continue improving your product. The same goes for your OKRs. Are you on track to meeting your goals?
- Include your team in the process. Collaboration on the data side of your project will ensure its importance is spread throughout your company, and adopt it into the standard procedure for your organization.
Challenges with using them and how to overcome them
Here are a few common mistakes that people make when using OKRs and metrics to measure their product performance.
Focusing on vanity metrics
Vanity metrics are numbers that don’t measure your performance in a way that’ll help future product success. Instead, they’re metrics that just make you look good.
For example, social media metrics- such as post likes and comments- are handy for making your brand look popular, and can be useful due to increased engagement and outreach.
But, if they’re not accumulating in actual sales and customers, they don’t mean much for your business. So, don’t focus solely on these metrics. Combine them with other, particularly important ones that’ll help understand the actual performance of your product (like the ones we’ve listed above!)
Expecting immediate results
Analyzing OKRs and metrics takes time. They’re things that you’ll need to be using consistently to see benefits within your business and may take months to see improvements. Be patient. Stick with it. Thank us later.
Creating too many OKRs or metrics
Overusing these methods is incredibly time-consuming. OKRs should only be used for top-priority targets - not as your to-do list. Ensure that you’re focusing on only the most important and beneficial metrics and OKRs to build a solid foundation for identifying the best product marketing process for your company.
Setting unrealistic targets
It’s so easy to get lost in the excitement of what you’d like to achieve. And sometimes the objectives that you end up aiming for are unrealistic when compared to your company size, budget, or workload. Ensure that you’re consistently checking how practical your OKRs are, and setting yourself time frames of when you’d like to be seeing these achievable targets come into fruition.
Want to learn more?
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