Product analytics is the collection and analysis of data to understand how end users engage with your product. Each interaction can help you understand who your audience is, how your service is resonating with them, and what you can do to improve.
Let's dive into 5 questions that product analytics can answer for your business.
Who is using your product?:
Sure, the marketing team might have created their target persona. However, if that doesn’t match who’s actually using your product, expect to waste some marketing or development dollars down the line.
When, how, and why are they using your service?:
If you can tell which features your users use and often they use them, you know exactly where to allocate resources.
When, how, and how much are they paying you?:
What segments of your customers pay monthly or yearly, pay once or repeatedly, bring in the lower 25% of revenue or the top 25% of revenue, …, etc.? Pay attention to how each of these segments use your product.
Why do they stay or come back?:
What’s your service’s “Aha!” moment that keeps your customers coming back to you? Also, how can you get trialing or at-risk users to this point faster before they churn?
Why do they leave?:
Is your product design, user experience, price, or onboarding causing people to leave and never return? Once you figure this out, you know exactly what to fix next.
You’re in a good place if you can answer these questions.
If you can’t answer them all, no worries. Start with one and slowly build from there.