The Rise of the SaaS

Product Manager Why Product Management Is More Important Than Ever!

Tom Evans

Lûcrum Marketing

@compellingpm

Discussion Agenda

• What Product Management Isn’t

• What Is Product Management?

• Product Management Practices in Saas Companies

This Isn’t Product Management

http://www.luminomagazine.com/mw/storyimages/1021_wide.jpg

• So what you do is you take the

specifications from the

customers and you bring them

down to the software

engineers?

• That, that's right.

• Well, then I gotta ask, then

why can't the customers just

take the specifications directly

to the software people, huh?

• Well, uh, uh, uh, because, uh,

engineers are not good at

dealing with customers.

These Aren’t Product Management Either

• PM sits in office and determines what they think the

customer wants.

• PM creates thick requirements document and expects that

engineering has all of the information they need.

• PM collects all requirements and gets cross-functional team

to prioritize.

• PM only writes technical specs and tries to tell engineering

how to do their job.

What is Product Management?

“Product Management ensures the

company delivers products that are

valuable for the customer, company and

partners throughout the entire product

lifecycle”

Managing Throughout the Product Lifecycle

What Does Product Management Do?

• Conduct market & competitive research

• Solicit, validate and clarify requirements from stakeholders

• Develop business case for major product investments

• Create product strategy and communicate requirements

• Define and defend the product positioning

• Prioritize/order requirements (User Stories)

• Validate resulting product with market

• Support marketing, sales team, channel (sales tools)

• Communicate clear & consistent market messages.

• Help achieve key business metrics

Most Important Aspect of Product Management

The aim of marketing is to know and understand the

customer so well that the product or service fits him and

sells itself.

Peter Drucker

Discover Market Needs That are Worthy of Solving!

Discovering/Understanding Market/User Needs

• User communities /

user groups

• Usage analytics

• A/B testing

• Feature requests

• Product advisory

committees

• Customer calls/visits

• Win/Loss analysis

• Social media

• Competitive analysis

• Support issues

• Industry analysts

• Potential customers

• RFPs

• Etc.

Balancing Needs of Multiple Constituents

The role of a product

manager is to serve as a

communications "hub" for

a publisher's software,

coordinating the different

and frequently conflicting

wishes, needs and

priorities of development,

sales, marketing and

customers. – Merrill R.

(Rick) Chapman (2004)

http://www.amazon.com/review/R3SJS38JIQMU8L

Creating a Profitable Product Strategy!

Product Management Practices for SaaS

• Define and improve key product metrics

• Create dynamic interactions with customer community

• Align customer feedback with product strategy

• Represent customers with development

• Apply usage analytics appropriately

• Create buzz around new capabilities

Improve Key Product Metrics

• Metrics that drive your business model (e.g.)

– Conversion ratios/times

– Usage statistics

– Net Promoter Score®

– Support issues

– Implementation time

– Time to usage

– Cost of Acquisition

– Etc.

Dynamic Interactions with Community

• Participate in the conversation

• Actively solicit feedback

• Present new ideas for feedback

• Develop consensus

• Identify customers for working groups

• Build buzz about new features, capabilities, etc.

Represent Customers with Development

• User Stories are a start of a conversation around a need to

be met.

– Elaborate via a grooming process

– Engage customer working groups to elaborate

requirements

• Regularly demonstrate working software to customer

working groups (after each iteration)

• Give customer working group first access to final version

Align Customer Feedback with Strategy

• Case Study - Mint.com

• Many users requesting Quicken/MS Money type features.

• Not their value proposition, not their target market

• Clearly understood their key user persona & thus their

product strategy.

• What if they had responded to customer requests (not

their target market, would have changed their positioning,

etc.)

Apply Usage Analytics

• Application of analytics depends on user interaction

– How often and how complex of interaction

• Simple workflows

– Analytics provide valuable insight

– Easy to do A/B testing

• Complex interactions

– Analytics is an important indicator, but in and of itself is

not usually sufficient

– Must understand context via customer discovery

Create Buzz Around New Capabilities

• Challenge: no major launch events to build buzz

• Active participation in online community and other

online/social media

• Plan schedule of new capabilities to create bundles that

synergistically increase customer value

• Make major announcements around bundle of new

capabilities

Characteristics of a Successful Product Manager

• Passionate about understanding market needs

• Engages well with customers & non-customers at all levels

• Provides leadership (vision, strategy) for their products

• Works well with and develops respect with all parts of the

organization

• Understands how their product supports corporate

strategy, goals, objectives

• Delivers requirements to development supported by

market evidence

Acknowledgements

• Tom Hale, Chief Product Office, HomeAway

• Erik Huddleston, Executive VP, Products and CTO, Dachis

Group

• Audrey Montgomery, Senior PM – SaaS Products,

Blackbaud (Convio)

• Denny Lecompte, VP – Products, SolarWinds

Copyright 2012 - LÛCRUM MARKETING

Thank You!

Tom Evans

Lûcrum Marketing

tevans@lucrum-marketing.com

+1.512.961.5267

@compellingpm