Day 11: Define your KPIs

[Day 11/30: Product Manager to CEO 30 Day Challenge] When you're developing a new product, it's easy to get caught up in the excitement of building something new. But if you're not careful, that excitement can lead you down a rabbit hole without any clear direction—and then your product may never see the light of day.

To make sure that doesn't happen, it's important to focus on what matters most: your KPIs (key performance indicators).

A KPI is the metric that matters most to your business right now. It's what will help you make decisions about how to move forward with your product, how much money to spend on it, and which features are working best.

The best KPIs should be simple and specific. For example: "How many people have signed up for our service?" or "How many people have clicked on this ad?" It doesn't matter if no one has signed up yet—what matters is that we know exactly how many people have done so by this date next week.

The KPIs that matter are going to be different for every product in your portfolio.

Here are some commonly used Product KPIs -

1. Customer retention rate: This is a measure of how many customers keep using your product after the first month or so (usually 30 days). You can also use this KPI for new users—how many come back after their first week?

2. Customer lifetime value: How much money does each customer spend over their lifetime with your company?

3. Conversion rate: How many people click on an ad, sign up for a trial, or convert into paying customers?

4. Growth rate: How much has revenue grown since last year? Five years ago? Ten years ago? If a company doesn't have growth in revenue, it probably won't survive long-term.

Operational KPIs – These KPIs typically measure how well your business is operating on an operational level and include:

1. Customer acquisition cost (CAC) and lifetime value (LTV) per customer acquired

2. Number of customers who use your product or service every month

Customer satisfaction – Customer satisfaction KPIs show how happy customers are with your product or service. They can be used to improve customer retention rates and ensure that more customers continue using your products or services over time.