By Felicia Anderson
SaaS provides a treasure trove of new user insights.
As customers adopt Software as a Service (SaaS) in record numbers, those software providers that effectively leverage SaaS’ unique advantages will move into industry-leading positions. Companies that fail to do so will lose competitive ground.
Here are 3 areas that every SaaS product team should consider to make the most of the SaaS opportunity.
Instrument your products to observe true user behavior
SaaS providers have unprecedented visibility into users’ activities. Product teams should add capabilities to track user behavior quantitatively and use that information to improve the product. This approach typically yields much better results than activities such as focus groups because it shows what users actually do, not what they say (which is often notably different than what they do).
Intuit, a company renowned for its practice of following customers home to monitor user behavior in a natural environment, got dramatically different results when talking with users about a solution versus silently observing their behavior from within the product. In one case, they were considering how to improve the onboarding process for new payroll customers.
Initially, they mocked up screens to show the option of running the first payroll prior to completing the full configuration. With screenshots in hand, they met with 20 prospects and asked if they would choose the option of running the first round of checks before completing the set up. Not a single prospect expressed interest in this option.
Then they changed the screen on the actual site to show this as an option. They didn’t have the backend functionality yet but wanted to test user behavior. Intuit founder, Scott Clark, recounts that “when they actually didn’t ask an opinion and just watched behavior, 58% clicked, “I want to cut the checks first.” 58%.”
That’s an eye-popping difference: zero percent interest when talking with the prospects versus 58% interest when presented with the option in the product. The product team proceeded to add the capability, which resulted in the fastest customer growth for that product in ten years.
Use SaaS’ superior customer feedback options
Great SaaS products enable users to provide feedback within the context of the user experience itself. With an easy-to-find, simple, in-application feedback capability, users will typically provide more accurate and more useful feedback. Well-designed in-app feedback can reduce customer service cost, increase issue resolution speed, and result in more actionable enhancement suggestions.
Tweet this: Great SaaS products enable users to provide feedback within the context of the user experience itself
EdX, the nonprofit that provides free online courses from MIT, Harvard and other leading colleges and universities, provides a great example of in-application feedback. The user goes to the same place for all types of feedback, and the form is very simple and short (just 2 questions, see below). But possibly the most important feature is that access to the help tab moves with the user so that it is always visible, even when the user scrolls down. When users have a suggestion or concern, they do not have to scramble to figure out where to go to share their feedback.
EdX Feedback Form: Simple, Short, and Easy to Find
SaaS industry leaders understand this simple truth:
“the single biggest driver of long term profitability for your cloud business…is the renewal rate of your customers.”
To minimize churn, mine the data from your SaaS user base to identify leading indicators of attrition. One useful practice is to monitor usage by account to identify accounts that have recently reduced either their log-in frequency or their transaction volume. These accounts are frequently at risk of churning, so coordinate with sales, professional services, or customer support to intervene prior to losing the customer.
Tweet this: To minimize churn, mine the data from your SaaS user base to identify leading indicators of attrition
SaaS provides exciting, new ways understand and stay close to customers. With on premise products, product managers could only speak with and get feedback from a limited number of customers each year.
With SaaS products, on the other hand, it’s possible to glean insights from the entire user base, whether that’s 100, 1,000 or 100,000 users. Armed with superior information across a broader set of users, product managers of SaaS products can deliver solutions with even greater customer value.
Tweet this: What’s different about managing SaaS products http://wp.me/pXBON-4rH #cloud #prodmgmt
About the Author
Felicia Anderson is Director of Program Management, Cloud Services at OpenText. She helps product teams improve product investment decisions and increase launch success of cloud-based products.
Why Intuit Founder Scott Cook Wants You To Stop Listening To Your Boss, Fast Company, http://www.fastcompany.com/3020699/bottom-line/why-intuit-founder-scott-cook-wants-you-to-stop-listening-to-your-boss
 Byron Deeter, Bessemer Venture Partners, http://www.bvp.com/blog/customer-success-company-success
As soon as somebody says you’re spending too much time on something, you’re on the right track.—Bob Lefsetz, American music industry author.
There are two approaches to delivering stories to your product team: pull and push. Typically, product managers and executives “push” more and more requests to the developers. Even though the team already has a bunch of things, we push another few and then another few and then some more until the team is paralyzed with unfinished work. In more practical terms, the product manager builds a long list of prioritized requirements, perhaps grouping them into themes or releases, and sends the developers a few hundred items at a time. This is probably the most common scenario and tends to have three negative effects.
First, a long list of stories is overwhelming to the team, which damages their spirit and hurts productivity. Second, this approach tends to give you a whole bunch of disconnected stories so you have 80% of everything but not 100% of anything. Finally, pushing a lot of work at one time means you can’t reasonably re-prioritize the work when business conditions change.
Rather than pushing a bunch of work to developers, I prefer to let them “pull” work when they’re available to take on new tasks. In this scenario, the product manager maintains a long list of prioritized work. Developers request more work when they have bandwidth and the product manager hands them the next thing on the prioritized list.
One of the chief ideas of Kanban is to limit the amount of work in progress. Each developer works on one item at a time. They work until they’re done and then ask for more work. The product manager maintains a steady queue of work in queue.
Since the product manager is constantly prioritizing the list, the most important items are always on the top of the queue, waiting for development bandwidth.
Task switching is a well-known detriment to productivity. You want to avoid changing the work that has begun. Never mess with work-in-progress. But since no work is being done on your story queue, you can always add items to the top, bottom or the middle based on their importance.
In one product management job, I was told the development team was terrible; they couldn’t seem to finish anything. Investigating further, I found the problem wasn’t with the developers but with the executives. They were changing the priorities constantly. They didn’t seem to realize that one sentence from the leadership team meant weeks (or months) of work for the product team. I found the developers to be quite competent but with an ever-changing priority list, they couldn’t complete anything before a new #1 priority interfered.
We switched the team from a push approach to a pull technique. We didn’t mess with anything that was in progress. All new ideas went into the product manager’s queue, was prioritized based on business value, and then delivered to development when they needed work. That meant that executive pet projects could be put on the stack and then delivered to the team when the item became a top priority.
It also meant that bugs and architectural stories could be delivered to development just like requests for new functionality.
And when you’re working in short cycles, new important items can be started every week or so. It’s not like we have to wait a month or a quarter to begin a new initiative.
Are you using a “pull” method with your team? Share what’s working in the comments.
Want to take your Product craft to the next level? Attend the Craftsman PM 2-day hands-on Product Management workshop.
- Think holistically about building and marketing The Whole Product
- Go beyond MVP/Lean Startup and dogmatic frameworks
- Raise your Product Management game
Details are here:
Tweet this: Product Management workshop – Chicago – August 22-23 2015 – http://wp.me/pXBON-4rm #prodmgmt
by Saeed Khan
If you work on a product that requires a training class, your product is way too complex!!!
OK, just kidding. 🙂
If you work in the B2B space, it’s almost guaranteed that there is a training requirement for your product. The training may be delivered face-to-face in a classroom setting, or over the web with a live instructor, or even possibly as a self-paced recorded course.
Regardless of the type of class, odds are you (PM, PMM, UX Lead etc.) didn’t create that class and almost certainly you don’t deliver that class to customers.
You may have attended the class (once) when you were hired or started working on the product — assuming the product already existed — or maybe never at all if you started early enough and learned it on your own.
Regardless of which situation you are in, you should make it a practice to REGULARLY sit in on your product’s training class.
What do I mean by ‘REGULARLY’? Well, it depends on a number of factors, but at least once per year, if not 2 or 3 times per year if possible.
If the class is a long class (say 2 or 3 or more days), and it’s difficult to commit those days completely (we’re always pulled into meetings etc) then at least sit in on the FIRST day of the class a couple of times a year. Try to pick classes where there are a good number of students attending.
But WHY? We’ll I’ll tell you.
1. It’s an easy way to meet customers face-to-face
OK, this assumes you have a classroom style training course. And if you do, that great!!! Take advantage of it. Meeting these users face-to-face is a great way to start building a relationship with them. Most classes I’ve seen start with some kind of self-introduction by the students. It’s a good way to learn about who is (will be) using your product and also to introduce yourself to them.
You don’t have to become their friend during the class, but when you introduce yourself as the PM for the product they are learning about, trust me, they’ll remember you. And later, if you reach out to them, they know who you are.
Even if the course is NOT a face-to-face classroom setting — i.e. it’s taught by a live instructor to the students over the internet — you can still introduce yourself and make the students aware of you. Better than nothing I say.
Tweet this: 5 Reasons why you should regularly attend your product’s training classes http://wp.me/pXBON-4qV #prodmgmt #prodmktg by @onpm
by John Mansour
A clever person once said that it’s product management’s job to put the products people want to buy on the shelf, and product marketing’s job to get buyers to take them off the shelf. For B2B companies, emptying those shelves requires a unique competency in your sales force that goes beyond the capabilities of a typical product marketing function. Is sales enablement the answer – and is there a real difference between product marketing and sales enablement?
Some might think that these two functions are really the same thing with a different label. There’s certainly some overlap, but these terms allude to the primary objective of each function. In very simplistic terms, I’d characterize them follows:
In the literal sense, the objective is to create marketing materials and sales tools for products, utilize all marketing mediums to communicate the value of those products, and teach sales people how to use the sales tools in day-to-day competitive sales situations. There’s an element of sales enablement involved here as salespeople learn how to position products.
Sales enablement is much broader than product marketing. To expand on the above, this is about helping salespeople become highly proficient at selling business value in day-to-day sales situations. Inherently, selling business value requires knowledge of how to position products.
Keep in mind, there’s a big difference between selling business value (sales enablement) and positioning the value of your products (product marketing). Selling business value is much more than selling the benefits of each product – it’s convincing prospective customers to do business with your company for reasons that go beyond the value of your products.
So how do you do that?
Understanding the buyer mindset
In a typical sales cycle, buyers form first impressions of your organization from salespeople. The goal of sales enablement is to make your salespeople so credible that prospects view your organization as a valuable resource that can help them meet their goals.
For example, let’s say construction companies are one of your target markets. Imagine your salespeople in an initial meeting discussing construction industry trends and the latest best practices that successful construction companies are implementing to address the dynamics of their market. Salespeople with that level of competency have instant credibility before the discussion goes anywhere near the products.
Here’s the thing: Buyers prefer to do business with companies that understand their industry and business dynamics best. That level of expertise creates a perception that your products and services are better than competitors who aren’t as knowledgeable.
Buyers also assume your organization is dealing with lots of companies just like theirs, and whether they come right out and ask or not, they want to know what everyone else is doing and what they should be thinking about. Salespeople who bring that type of information to the table will quickly move to the head of the pack. Without a strong sales enablement function, there’s no systematic way to ensure salespeople can communicate that type of information consistently.
Now for the disturbing part: A huge percentage of B2B companies don’t even have a formalized product marketing function. The most common reason I hear is, “Our senior leadership doesn’t want to make the financial commitment.” In other words, they don’t see the value. But in the next breath they’ll say, “Our salespeople need to get better at selling value/selling solutions instead of features.”
Has the time come to stop trying to justify product marketing and sell the value of a dedicated sales enablement function (that encompasses product marketing)?
Tweet this: Should Sales Enablement be the new Product Marketing? http://wp.me/pXBON-4qN #prodmgmt #productmanagement #prodmktg #sales
About the Author
John Mansour is a 20-year veteran in high technology product management, marketing and sales, and the Founder of Proficientz, Inc., a training and consulting firm that specializes in B2B product management & marketing.