The Essential Guide to SaaS Product Management
The following guide will enable you to ace your SaaS product management strategy and supercharge your customer success through product-driven intelligence.
Most companies use SaaS applications for various functions throughout their organizations. SaaS or “on-demand” software goes back to the 1970s. Offering software-as-a-service products became necessary to make it affordable for companies to bring certain systems onboard. With both time and the internet boom, it became much easier to get access to various software solutions. Managing these software solutions became extremely important. The explosion of SaaS companies in more recent years is proof of the dynamic technological landscape of the business world during the previous decades. The shift of many major companies to SaaS and cloud operations has made it more important to find ways to manage them…and manage them well. This has had a major impact on the product space.
A SaaS product is basically an online software that users with a license can access. Managing it encompasses a wide range of responsibilities. As a result, product management has come to mean different things for different organizations. Studies show that, through effective product management, it is possible to increase profit by 34.2 percent on effective implementation.
Product management is a process that enables successful completion of the product lifecycle. It essentially involves designing the product better for higher performance with the right planning. SaaS product management is necessary to offer better solutions to customers based on their needs.
SaaS product management is the process of driving the development, launch, marketing, and improvement of company’s products throughout the lifecycle. The tasks include a mix of tactical, professional, and strategic duties. Some of the key responsibilities in SaaS product management include:
Most product professionals’ conduct research to get expertise about the company’s product, market, target audience, user personas, statistics, and competitors.
Product management professionals also have to map out the product vision. Understand the objectives of the product, the vision the company has in store, and create a plan accordingly. The vision needs to include goals, objectives, high-level discussions, and more detailed info of the product.
By understanding market research and customer feedback, product managers need to define requirements and features of the product. This needs to be chalked into a plan and communicated with higher-level teams for internal planning.
Once the vision is cemented by the teams at all levels, it is important for product managers to develop a plan. A strong plan including goals, objectives and more needs to be created to be presented to key stakeholders. Product management is a process that essentially involves many teams and people.
With the plan in place, the next step is to create a roadmap to maintain product plan. Having necessary teams combine to make a stellar roadmap leading to product success is what this role is about.
After coordinating development and meeting team needs per the product strategic plan, it is time to introduce the product. Acting on feedback and data analysis helps product managers understand what works and what doesn’t. Working with the right teams will help fine-tune improvements to the product. At this stage, fixing any development bugs will immensely help product managers.
Product management requires a separate function because there are so many responsibilities. Just like sales or marketing teams, it is essential to get a separate product management expert. Product management is a highly strategic function and are expected to answer key questions, such as the who, what, when, where, and why about the product.
Product manager responsibilities in SaaS organizations include ensuring that the entire company is working towards shared goals in the organization. Theyy are also responsible for communicating product objectives and updates with the rest of the company. SaaS product manager functions are vastly different from project manager functions. There is a certain level of product-focused strategic thinking involved in product management requiring a separate skillset.
Whether you have someone with this title or not, you probably have a product manager on staff. A product manager is the person in a company who is responsible for the internal and external product vision and leads the product development from start to finish. The product manager is someone who charts customer needs, understands customer requirements, teams with stakeholders, coordinates across required teams, and manages the creation of the requested product. So, the one person or team responsible for carrying out the overall product from start to finish is the product manager. Author Marty Cagan defines the purpose of product managers in his book, Inspired: How to Create Products Customers Love as the person “to discover a product that is valuable, usable and feasible.”
As a result, a product manager has to be proficient and well-versed in three main aspects to succeed:
The functions of a product manager are broad. While they may assist at various tasks in the company, their key focus is essentially around the product.
The first activity or function of a SaaS product manager involves determining an opportunity for a product. It can be developing a new product or improving an existing one. New features or upgrades can be involved as part of the customer feedback process. The product manager needs to know trends, the most recent data, and more to have a deep understanding of the market. When a company decides to launch a product to solve a particular need, a strategy needs to be developed to make it happen.
A product manager first needs to have a long-term plan and overall mission regarding the scope of the project. There needs to be a clear plan on how to reach that crux of what customers want. To do so, product managers need to develop a product plan. Nearly 84 percent of SaaS product managers agree that setting up a product strategy is key to product success.
A product manager role has involves many other teams. Product managers need to make sure that all stakeholders and team members work together to achieve the product as desired, which is often their most important function. They need to communicate requirements clearly to the team and organize a plan that works best for everyone. A product manager also needs to manage and handle urgent requests with stakeholders, meet their expectations, and balance overall team needs.
Another responsibility of SaaS product managers includes undertaking marketing activities. Since marketing activities are the base of product success after launch, this is a key function. Market research, collecting competitor information, checking industry trends, analyzing customer feedback, making it UX friendly, determining a price and more are essential to this role.
It is also known that a product manager has to constantly improve the product before during and after launch. Everything becomes obsolete over a period of time. Product management requires managers to work on the product, analyze it, test it, check for improvements, bugs, manage defects, incorporate customer feedback and more. A SaaS product manager is required to constantly keep themselves updated about the product and work on the strategy.
The SaaS product management process lifecycle is a mix of strategic and tactical actions. There are multiple stages that involve strategic thought, such as marketing.
On a deeper dive, the product management activities can be classified into two categories:
1. Inbound activities
2. Outbound activities
The key steps in a product management process include the following:
Product vision is an important part of product management. It defines the final product and shows how it is possible to create the product. The product vision defines the product, how to achieve it and more. It starts with idea management where the team brainstorms the new product based on the idea. A product manager sets the goals for this phase to answer key questions like:
Customer understanding is another key to product success. Market research is the way to collect information about the product keeping customers in mind. It’s based on comparing similar products, studying competition, and checking target groups. Nearly 80 percent of customers expect companies to know and understand their needs completely. 84 percent of companies who are aligning to customer experience showed a higher revenue increase. A product manager needs to understand customers to create user personas, identify customer needs as per quality, choice, price and convenience. Studying customer behavior is another aspect of this product management lifecycle to understand motivation, campaigns and more.
Once the vision and market are understood, it is necessary to have a product strategy in place. A specific product strategy defines the goals, milestones and plan for the product. It defines the main features of the product with their users and key performance indicators (KPIs) mentioned. The strategy is a roadmap that involves:
Product strategy roadmap is one that allows the team to have actions matched with timelines and goals. It is a great visual guideline for product managers and companies to know the working timeline.
Product development begins with understanding technical specifications, making a mockup design, creating prototypes and more. In a product management process, it is necessary to identify what users want and communicate that to the technical development team. The product management process involves core responsibilities like defining the minimum viable product and making sure it is released. It is also important to have a feedback collection mechanism, update according to the feedback and get the product ready.
Nearly 60 percent of product managers feel that their best ideas came from customer feedback. A product manager also needs to test their product frequently to understand feature usage engagement. It is important to get the minimum viable product (MVP) out and analyze customer reaction and acceptance to the product.
At this stage in the product management lifecycle, it is important to start looking to launch the product. Sales and marketing teams need to build a launch plan based on the following:
Once the product has reached the launch stage, it is time to go ahead and release it into the market. Monitoring the progression and analyzing data is very important here. The key metrics for analyzing product performance are outlined below.
In SaaS product management, it is necessary to keep a note of the subscription revenues as a primary metric. Just choosing these metrics is not enough. It is necessary to follow up, analyze, and gain valuable insights from the data. These results will be helpful in understanding areas that need improvement, features that need to be upgraded and sales strategies that need to be fixed.
Once the metric-based information is available, the next step is to work on improving the product. Making the necessary changes will greatly help improve the prospects of the product.
To build a strong SaaS product management team, it is important to have a skilled SaaS Product manager. A product manager will be the one who influences every aspect of the business. This includes marketing requirements, customer needs, revenue streams and much more. For all these reasons, it is important to hire a successful B2B SaaS product manager who can handle everything related to products.
There are some essential qualities that every B2C and B2B SaaS product manager needs to be able to do, including:
A product manager should know the product and understand it deeply. Be it a start-up, small company, or large enterprise, product managers should thoroughly understand the product. They need to be able to create a sustainable vision of the product to satisfy customers’ needs now and in the future.
A product manager is expected to know customers’ needs and develop a plan that will keep their products profitable. A product manager needs to interact with sales, research and marketing teams to get better idea about customers. Understanding the customer journey and user experience is another important aspect a product manager should be able to shoulder. They also need to change their products to suit market requirements.
A SaaS product manager needs understand their responsibilities. They not only need to be able to create a vision for SaaS products in the foreseeable future, they also need to monitor and evaluate market trends to develop responsible plans and communicate effectively. Products attract customers to companies. Product managers control the design, scope, look, and pricing of the product, ultimately attracting attention towards the company.
Anticipating problems is another skill a product manager needs to have. Complex situations are bound to arise, and SaaS product managers need to have the analytical skills to make it simple and solve the issue. A SaaS product manager needs to possess the mental stamina to pursue a situation until it gets resolved.
Successful product managers are those who have a mix of soft and hard skills. Hard skills, such as education, experience, and time management, important. But soft skills are needed to create and encourage positive environment at work. They include compulsory skills such as communication, negotiation and mutual respect for co-workers and customers.
Product managers need to have leadership qualities. Transparency, honesty, trust and skills that involve delegation are necessary. They need to be able to notice the innate strength in people and inspire enthusiasm for products. A good product manager is one who responds to the core issues of the product team and solves them. Leadership is considered an essential quality.
SaaS product managers have a big impact on their companies due to the importance of their roles. They need to make tough decisions. If a product manager is not able to make good decisions when needed, it reflects poorly on the organization.
To build a strong SaaS product management team, there are other things to keep in mind, including:
For a SaaS product management team to improve customer success, it is important to build great products. Customer retention is critical for SaaS companies and, to minimize churn, a high-quality product is vital. As your product grows, so does the company. Making the team believe in the idea and vision of the product is important.
Customer success and product management need to be aligned to scale. Both product management teams and customer success teams are bound by ensuring customers receive value. Product teams need customer success teams to do so. Conversely, customer success teams need product teams to sell that value to customers. This is what drives value.
Product management coupled with customer success are data-driven. They are a means to make customers reach their desired outcomes through qualitatively and quantitatively assessing data and its implications.
Product management helps create customer personas. This can be helpful in matching it with existing customers to fit them in a specific role. This is also beneficial for driving outcomes and aligning revenue growth metrics based on persona behavior.
When you visualize how your SaaS product management team can contribute to growth, the right technology is imperative.
SmartKarrot has an array of features that facilitate the powerful mix of product experience and customer success. SmartKarrot’s product success feature seeks to leverage product interaction to understand levels of engagement and its impact on business. Informed product success decisions will improve interactions. The liaison helps:
To make the right product management decisions, it is important to have the right information and insights. This intelligence and data will enable the right decisions by SaaS product management. Improved analysis of user behavior is the key to finding the right vein for your product.
Ultimately, an improved product management strategy coupled with customer-centric behavior will lead to growth.
Originally Published January 21st, 2021, Updated February 9th, 2021