Did you know you can improve user retention but make a product worse?
Product metrics don’t always reflect how effectively a product solves a user’s problem.
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Let me illustrate why with this shovel example:
- You have a product—a shovel.
- People rent the shovel to dig a pit.
- With the current version of your shovel, the process takes 10 consecutive days of work. After that, people stop using it. The ‘retention rate’ of the shovel rapidly declines after 10 days.
- The team uses ‘retention’ to measure the success and value of their product. After all, the longer people use the shovel—the more value it’s creating.
- At some point, the team launches a new version of the shovel with a reduced blade size.
- The retention rate for users of this new version of the shovel is significantly better. The team is happy.
- However, the only reason why retention is up—is that it now takes 15 days to dig the pit.
The example may seem absurd, but product teams often do the same with their products. They optimize for some metric losing sight of the fact that along the way they have made their product worse (less effective).
So don’t forget about the goal of PMs—to create value by solving customers’ JTBD in a more effective way.