Data Sense for Product Managers
Think of Data sense for PMs as an understanding and knowledge that involves having to think about user actions (what is happening) and logically putting together a hypothesis (why it is happening) behind those actions.
Just the understanding of the user actions tells us only half the story. It is when several measurements are collected together that they become a complete story.
What does data sense for PMs include?
includes but not limited to —
- Have a basic understanding of the Key Performance Indicators (KPIs)
- Basic understanding of the key metrics that will allow you to accomplish your KPIs
- Aware of the funnels of your user journeys that impact the metrics
Some Example Data Concepts:
- Data Points
- Categorization
- Funnels
- Groups
Data Concepts explanation:
Why do product managers hesitate to dive into big data?
Ever heard of Analysis Paralysis? #1 reason is that we get bogged down my slicing and dissecting the data stuck in analysis paralysis, that we miss that chance to act. Don’t stay stuck.
PMs should always balance their time between ANALYZING DATA and TAKING ACTION.
DATA SENSE is a segment in PM interviews where you will be given questions and will be judged on how you segment or categorize your data and come up with meaningful metrics. ⠀
METRICS ARE WHAT YOU MEASURE!⠀
For Example — Conversion rate (% new visitors who register) or average value of checkout (total checkout value/number of checkouts).⠀
THE HARD PART IS DECIDING WHAT REALLY MATTERS WHEN MEASURING.
There is a concept of vanity metrics vs. meaningful metrics. ⠀
Example: To me, the number of Instagram followers on our Product Career Page (where I share bite-sized content on product management) does not indicate much but when my audience shares and saves my post….that is a metric I track. ⠀
It better indicates which posts are liked. ⠀
NOW that does not mean that increasing the number of followers is a vanity metric. ⠀
Let’s say your goal is to sell a product and hypothetically 10% of your followers convert then increasing your followers might mean increasing that 10% bucket and increasing revenue. ⠀
SO I’ll close with this — what you measure matter! ⠀
As a product manager, your goal is to align your team on meaningful metrics that align with business goals. ⠀
What metrics do you track in your product or business and why?
This post is a series on Product Manager Must-have Skills. Check other posts below also Check us out on Instagram and Linkedin
I have linked those posts below.
You will need these skills if you are looking to change your career to Product Management?
“Do I need to know coding to be a product manager?”
Why is it important to be a good communicator as a product manager?
