Product Management for Startups by Dan Olsen

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Information about Product Management for Startups by Dan Olsen

Published on November 14, 2009

Author: dan_o



My Product Management talk from the NextGen Conference at Stanford on Nov 14, 2009.

Product Management for Startups Dan Olsen CEO, YourVersion Nov 14, 2009 Copyright © 2009 YourVersion

My Background Education BS, Electrical Engineering, Northwestern MS, Industrial Engineering, Virginia Tech MBA, Stanford PHP, MySQL, JavaScript, XHTML, CSS, UI design 18 years of Product Management Experience Managed submarine design for 5 years 5 years at Intuit, led Quicken Product Management Led Product Management at Friendster Olsen Solutions LLC, PM consultant for startups CEO & Founder of YourVersion, real‐time discovery startup Will post slides to Copyright © 2009 YourVersion

What is Product Management? Copyright © 2009 YourVersion

Product Management is Critical Link in Value Creation Market Product  Development  • Current  Management Team customers • Prospective customers • Competitors Product Management’s Goals: •Best Product   •Happy Customers   •Profitable Business Copyright © 2009 YourVersion

What’s the Formula for a Winning Product? A product that: Meets customers’ needs Is better than other alternatives Is easy to use Has a good value/price Copyright © 2009 YourVersion

Problem Space vs. Solution Space Problem Space Solution Space A customer problem,  A specific  need, or benefit that the  implementation to  product should address address the need or  A product requirement product requirement Example: Ability to write in space  NASA: space pen (zero gravity) ($1 M R&D cost) Russians: pencil Copyright © 2009 YourVersion

Problem Space vs. Solution Space Product Level Problem Space Solution Space (user benefit) (product) Pen and Prepare paper my taxes TurboTax File my taxes TaxCut Copyright © 2009 YourVersion

Problem Space vs. Solution Space Feature Level Problem Space Solution Space (user benefit) (feature) Gmail Make it easy importer to share a link with my friends Design Design Design #1 #2 #3 Preview with  User can edit  Allow me to Design checkboxes before import reuse my email #1 No No contacts #2 Yes No #3 Yes Yes Copyright © 2009 YourVersion

How Do You Prioritize User Benefits  and Product Features? Need a framework for prioritization Which user benefits should you address? Which product features to build (or  improve)? Importance vs. Satisfaction Importance of user need (problem space) Satisfaction with how well a product meets  the user’s need (solution space) Copyright © 2009 YourVersion

High Importance + Low Satisfaction = Importance of User Need Opportunity High Competitive Opportunity Market Not Worth Going After Low Low High User Satisfaction with Current Alternatives Copyright © 2009 YourVersion

Kano Model: User Needs & Satisfaction User Satisfaction Delighter (wow) Performance  (more is better) Need Need not met fully met Must Have Needs & features  migrate over time User Dissatisfaction Copyright © 2009 YourVersion

Olsen’s Hierarchy of Web User Needs (adapted from Maslow) Customer’s Perspective What does it mean to us? How easy to use is it? Usability & Design Satisfaction Increasing Does the functionality Feature Set meet my needs? Does the functionality work? Absence of Bugs Dissatisfaction Decreasing Is the site fast enough? Page Load Time Is the site up when I want to use it? Uptime Copyright © 2009 YourVersion

Importance vs. Satisfaction Ask Users to Rate for Each Feature 100 98 Great 95 84 87 90 Bad 86 85 79 84 55 70 80 Importance 80 75 72 80 70 75 65 60 55 41 50 40 50 60 70 80 90 100 Satisfaction Recommended reading: “What Customers Want” by Anthony Ulwick Copyright © 2009 YourVersion

Prioritization and Scope Customer value is only half of the story How much engineering effort will it take? Need to consider Return on Investment (ROI): Return: customer value created Investment: development resources required Ruthlessly prioritize: rank order product ideas Be deliberate about scope & keep it small Easy to bite off too much Strategy = deciding what you’re NOT doing Break features down into smaller chunks Smaller scope → quicker releases → more iteration Copyright © 2009 YourVersion

Prioritizing Product Ideas by ROI ? Return (Value Created) 4 Idea D 3 Idea A Idea B 2 Idea C 1 Idea F 1 2 3 4 Investment (developer‐weeks) Copyright © 2009 YourVersion

Have to Prioritize Across Multiple  Dimensions At The Same Time Ease of Use Customer Value Quality Functionality Customer  Understanding Time Copyright © 2009 YourVersion

User Benefits vs. Ease of Use Q: If two products equally deliver the exact  same user benefits, which product is better? A: The product that’s easier to use ‘Ease of use’ provides benefits Saves time Reduces cognitive load Reduces frustration Not many companies excel at UI design ‘Ease of use’ can be differentiator Copyright © 2009 YourVersion

The UI Design Iceberg What most  people see and react to Visual Design What good  product mgrs,  designers &  developers  Interaction think about Design Information Architecture Conceptual Design Recommended reading: Jesse James Garrett’s “Elements of User Experience” chart, free at Copyright © 2009 YourVersion

Elements of User Interface Design Consists of Three Distinct Elements: Information Architecture Structure and layout at both site and page level How site is structured (sitemap) How site information is organized (site layout) How each page is organized (page layout) Interaction Design How user and product interact with one another User flows (e.g., navigation across multiple pages) User input (e.g., controls and form design) Visual Design “How it looks” vs. “What it is”, often called “chrome” Fonts, colors, graphical elements Copyright © 2009 YourVersion

“Ramen” Usability Testing for Startups Learning from 1‐on‐1 user feedback is invaluable Keep it real: have user bring their laptop, sit at desk Conduct test sitting next to user. Format: 5 ‐ 10 min: Discovery, ask questions to learn about user 30 ‐ 50 min: Usability test (as non‐directed as possible) 10 min: Wrap‐up: Answer user questions, point things out Usability Do’s Explain rationale, not to worry about hurting your feelings Explain “Think Aloud Protocol”, be fly on wall, take notes Usability Don’ts Ask leading questions “Help” the user or explain the UI (e.g., “click over here”) Get defensive or blame the user Copyright © 2009 YourVersion

Approaching Business as an  Optimization Exercise Given reality as it exists today, optimize our business results subject to our resource constraints. Copyright © 2009 YourVersion

Define the Equation of your Business “Peeling the Onion” Advertising Business Model: Profit = Revenue ‐ Cost Unique Visitors x  Ad Revenue per Visitor Impressions/Visitor x  Effective CPM / 1000 Visits/Visitor  x  Pageviews/Visit  x  Impressions/PV New Visitors + Returning Visitors Invited Visitors + Uninvited Visitors # of Users Sending Invites  x  Invites Sent/User  x  Invite Conversion Rate Copyright © 2009 YourVersion

Sample Signup Page Yield Data Daily Signup Page Yield vs. Time New Registered Users divided by Unique Visitors to Signup Page 100% 90% 80% Daily Signup Page Yield 70% 60% 50% 40% 30% Started requiring registration 20% Changed Added questions messaging to signup page 10% 0% 1/31 2/14 2/28 3/14 3/28 4/11 4/25 5/9 5/23 6/6 6/20 7/4 7/18 8/1 8/15 8/29 9/12 9/26 10/1 0 Copyright © 2009 YourVersion

Identifying the  “Critical Few” Metrics What are the metrics for your business? Where is current value for each metric?  How many resources to “move” each metric? Developer‐hours, time, money Which metrics have highest ROI opportunities? Metric A Metric B Metric C Good ROI Bad ROI Great ROI Return Return Return Investment Investment Investment Copyright © 2009 YourVersion

Optimization through Iteration: Continuous Improvement Measure the metric Analyze Learning the metric Gaining knowledge: • Market Identify top  • Customer opportunities to improve • Domain • Usability Design & develop   the enhancement Launch the enhancement Copyright © 2009 YourVersion

Early Stage Product Management  Cheat Sheet Understand your customers’ needs Use problem space thinking to ensure your  solution is addressing your customers’ needs Identify opportunities & prioritize by ROI Design and launch your v1 product Talk with users 1‐on‐1 and get feedback Define equation of your business Identify and track key metrics Launch, learn, and iterate Copyright © 2009 YourVersion

Great way to stay on top of your interests Real‐time discovery engine Discovers new, relevant content tailored to your  specific interests News, Blogs, Tweets, Webpages, Videos, Products Bookmark and share via email, Twitter, Facebook Launched at TechCrunch50, won People’s Choice Free iPhone app, optional Firefox toolbar Check it out at Copyright © 2009 YourVersion

Questions? @danolsen Copyright © 2009 YourVersion

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