What Is Product Analytics?
An overview of product analytics, why it's important, and what kinds of data analysis you can do with it.
Product analytics is absolutely essential if you sell any digital products or services. Using product analytics, product managers and teams are able to see in-depth performance metrics about their customer journeys and experiences. It shows them the information they need to optimize product performance, enhance the customer experience, find how customers are interacting with their sales pipeline, and more.
With product analytics, events can be analyzed and recorded, showing you how users behave. Even more important, it can show you why users behave the way they do. This is possible when product analytics are optimized. Without product analytics, your marketing, UX, advertisement, and data teams are in the dark. They don’t have the information and insights they need to personalize user interactions and create long-term value for your users.
Narrator is a platform that can help you optimize your product analytics and make the most of them. Learn more about product analytics below and how Narrator can help your analytics team.
Why Is Product Analytics Important?
Product analytics can enlighten and empower teams to learn more about their users, what they want out of your products, and how they come to select them. Your teams have many choices to make when they’re selling and marketing your products, but without analytics, they have little to inform those choices.
With product analytics, you can find the best way to reach users and make their customer experience ideal. You can find out how to optimize your products and make informed, data-driven decisions instead of just hoping that your strategy will work.
Product analytics allows you to measure successes, failures, and opportunities for growth in your product pipeline. Using product analytics is important because it saves you time and money, and this information turns your customers into long-term customers instead of one-time flukes.
Examples of Common Product Analytics Goals and Outcomes
When you use product analytics, you’ll set out several specific goals for what you expect to gain from your product analytics. By measuring outcomes, you can optimize your products and user journey to reach and even surpass your goals.
Gather and Integrate Product Data Sources
Product analytics can help you aggregate and integrate all of your disparate product data sources. It’s inefficient to have raw data siloed across different data warehouses, databases, BI tools, and other sources. It can also cause duplicates, inaccuracies, and related problems. Product analytics can provide you with a single source of truth for your product data, so you can trust your data is always updated and accurate.
Track and Analyze User Actions and Behaviors
Product analytics allows you to track and analyze the behaviors and actions of your users. In Narrator, these behaviors are tracked and recorded as activities, which are recorded in our activity scheme, providing you with in-depth information and insights about your products and how your users interact with them.
Tracking and analyzing user actions and behaviors is the key to understanding what is important to them and where your time is best spent when it comes to acquiring users and turning them into conversions.
Identify and Assess Customer Cohorts or Segments
One facet of product analytics is cohort analysis. Cohort analysis segments your users into groups with identifiable and separate characteristics. You can divide your users by behaviors, actions, and various other metrics. This allows you to more easily identify which customer groups are worth focusing on and which drop out of the sales pipeline before reaching a conversion stage.
Identify UX Pain Points and User Flow Trends
Product analytics give you a visualization of how your users go from discovery to conversion. When you have an in-depth view of all these different steps of the user journey, you can see their pain points and trends for user flow.
This allows you to find optimization opportunities, address the weak areas of your sales pipeline, and understand the most important touch points in your customer journey. When you have a top-down overview of the customer journey, you can better enhance and customize the user experience. You can remove any barriers to conversion and challenges they face throughout the user funnel. This leads to more conversions and higher levels of personalization.
Improve Acquisition and Retention, Reduce Churn
Converting customers successfully is a good initial goal, but this process needs to be repeatable. In other words, companies need to retain users and increase long-term value. You want them to come back again and again, so your acquisitions are more worthwhile.
With product analytics, you can learn how to retain users with the type of product or service you sell. You can see what users return, track their behaviors, and understand what makes them come back. You can look into metrics related to churn and find out why customers leave or why your product is returned. As you get these insights, you can improve the user experience for customers who stick around and find out how to retain more customers in the long term.
High retention and low churn are essential in today’s highly competitive business landscape. With product analytics, these important goals are much more achievable.
Make Projections to Guide Product Development Priorities
Product analytics does more than just enhance the process and journey of buying the product for your customer. It can teach you ways the design of your product can be enhanced for your users. You’ll learn what aspects of your product are important to users and what aspects can be dropped. As you learn more about what makes your users tick, you’ll learn how to design and create the best product possible for them, improving performance on all of your other KPIs in the process.
When you can guide product development through data, you can prioritize more easily what your development teams should focus on. That means much less wasted time developing features that don’t resonate with users. And you’ll only be improving your product for the end user instead of causing them to drop off from changes they didn’t want.
The Narrator Platform Enables Self-Service Product Analytics
We know that product analytics is essential if you want to create an optimized product and user journey, but how can your teams access this data easily when they need it?
Narrator is the answer. With Narrator, any member of your team can get self-service product analytics in minutes. All they need to do is query and click the Analyze button to get senior data scientist-level data analytics, along with recommendations on how to proceed.
Empower your business to be data driven with Narrator. Book your demo today to learn more.