Tie user behavior to business value
1. List the 3 most important success drivers for your business.
A success driver is something that when increased/decreased, directly affects your bottom line and has a significant financial impact on your business. For example, a B2C SaaS offering a time-tracking app might identify that upgrades from free to paid plans have a significant impact on MRR.
2. Define the success formula for business value for product features.
Based on the 3 success drivers you listed, create a formula for determining business value of a particular product feature. For example, the B2C SaaS offering a time-tracking app might develop the formula: Business value = [how much this feature resulted in upgrades from free to paid plans (0-100%)] + [the overall usage of this feature compared to other features (0-100%)] + [the number of customer support requests produced by this feature compared to other features (0-100%)] / 3 And calculate an average score between 0 and 100%.
3. Map a feature-development process with your product team that includes experimentation for releases.
Require each feature or change release to include an experiment: in its most simple form, an A/B test where only part of the user base receives the new feature.
4. Check that your behavioral data collection can measure your success formula as well as experiment information.
Adapt your data collection, processing or reporting to include information about your success formula components and the experiments being run with feature releases.
5. Measure each feature release closely against the success formula to determine your next steps.
Uphold all rules about statistical certainties – such as sample sizes and duration of the experiment – to ensure that your analysis is clear. The result will be one of 3 options: the feature positively affected your success formula => release the feature for the entire user base. the feature negatively affected your success formula => gather more specific information about why. the feature had no significant impact against your success factors => discuss with relevant stakeholders if it should be adapted or released for other reasons.