This is a comprehensive guide to understand Digital Product management and the role of product manager understanding the demand of Cloud (SaaS based product development)

1. Digital Product
Management
By Swadesh Bhushan
(Certified Product leader and Product Owner)
https://www.linkedin.com/in/swadesh-bhushan/
swadeshbhushan@gmail.com

2. Digital Value Proposition
Digital Product Management Thinking & Digital Business Models
Day in life of Digital Product Manager
Prioritization in Digital Products
Data Driven Roadmaps
Portfolio of Metrics
Framework of Metrics that matter
Product Analytics and Analytics Platform
Experimentation and Hypothesis Testing
Pirate Metrics (AARRR)

3. Digital Value Proposition
In this presentation, only
mobile apps, and
Software (social media
application, digital
games, digital commerce,
digital bank app etc.) are
referred as Digital
Products
Digital Technologies

4. Digital Product Management Thinking
Digital product management
thinking involves a strategic and
holistic approach to
conceptualizing, developing,
launching, and maintaining digital
products or services.
It encompasses various
methodologies, principles, and
practices aimed at efficiently
creating and managing digital
products to meet user needs, drive
business value, and adapt to the
dynamic market landscape
Business Model
Hypothesis
Analytics
Coordination
Design
Develop
Analyze
Coordinate
Business Model
Hypothesis
Growth and Roadmap
Cross Functional teams

5. Digital Business Models – Understanding the Business Model Canvas (BMC)
A holistic framework to
understand, design and
test your assumptions in
the marketplace
This is also known as 1 Pager Business Model – Fast, Concise, and shareable with 9 building blocks

6. Digital Business Models
On
Demand
Market-
place
Open
Source
Software
as a
Service
• Consumption of the asset
is monetized. No longer
the possession of it
• “Use” instead of “Buy”
• Supply and Demand are
brought together
• Also referred as e-
commerce model
• Software is free to access
by users
• Source code is made
available to developers to
contribute to extension
• Variant of “On Demand”
model
• Hosted software is
licensed to customer via a
subscription plan
A Business model that
leverages digital product
technologies to create a
product or offering
Usage of digital technologies is
critical to its value proposition
Customer acquisition and
distribution are based on digital
channels
Revenue Models
Freemium Subscription Ad-Supported Pay Per Use

7. Day in life of Digital Product Manager
A day in life of Product
manager variates based
on the stages of product
life cycle
Proactive communication and
prioritization is the key !
Digital Product manager ensures
working with cross functional team
to develop the successful products
Live Features
In Dev
Features
Future Features
Data Analysis
Funnel Analysis
User Behavior
Analysis
High Involvement
AB Experiments
Finalizing Designs
Defining
Requirements
Roadmaps
Market Analysis
Identifying
Opportunities
BI &
Analytics
UX
Design UI
Design
Engineering
Team
Customer
Support
Stakeholders
Digital Product Manager

8. Day in life of Digital Product Manager – A different representation
The role of a Digital Product Manager involves orchestrating collaboration among
multiple cross-functional teams across various stages of product development,
including discovery, design, development, and delivery. Additionally, they play a
pivotal role in overseeing the performance monitoring.
A day in life of Product
manager variates based
on the stages of product
life cycle
Proactive communication and
prioritization is the key !
Digital Product manager ensures
working with cross functional team
to develop the successful products

9. Prioritization of Digital Products
A Business model that
leverages digital product
technologies to create a
product or offering
Usage of digital technologies is
critical to its value proposition
Customer acquisition and
distribution are based on digital
channels
RICE
(Reach,
Impact,
Confidence,
Effort)
MoSCoW
(Must, Should, Could and Will not have)

10. Data Driven Roadmaps
A high-level summary of
vision, direction, and
objectives of the product
Data-driven roadmaps are
crafted to attain precise
objectives by leveraging
timeline-based features for
deployment.
Goal
Features
Timeline
Examples:

11. Portfolio of Metrics
Metrics are the backbone
of Digital Product
Management
Metrics help in drawing insights to
• Improve the product
• Improve the experience
• Driving adoption and
engagement
• Increase overall health of
product resulting in revenue
increase
Product
Metrics
Business
Metrics
Customer
Metrics
Metrics that directly
represent the state of
various areas of the
product are called
product metrics
Metrics that directly
impacts the business
Metrics that indicates
customer satisfaction

12. Product Metrics
Metrics that directly
represent the state of
various areas of the
product are called
product metrics
Product
Metrics
Activation Rate Conversion Rate Retention Rate Churn Rate
Resurrection Rate Daily Active Users WAU, MAU
Activation
Rate
Example
Total Number of emails sent = 1000
Number of emails opened by user = 300
Activation Rate = (Number of emails opened / Total number of emails sent) * 100
Activation Rate = (300 / 1000) * 100 = 30%
Conversion
Rate
Total number of visitors to the product page: 1000
Number of visitors who made a purchase: 50
Conversion Rate = (Number of purchases / Total number of visitors) * 100
Conversion Rate = (50 / 1000) * 100 = 5%
Retention
Rate
Total number of customers at the start of the month: 500
Number of customers at the end of the month: 450
Number of new customers acquired during the month: 100
Retention Rate = ((450 - 100) / 500) * 100 Retention Rate = (350 / 500) * 100
Retention Rate = 70%
Churn Rate
Number of customers at the beginning of the month: 1000
Number of customers lost during the month: 50
Number of customers at the end of the month: 950
Churn Rate = (Number of customers lost during the period / Number of
customers at the start of the period) * 100
Churn Rate = (50 / 1000) * 100 Churn Rate = 5%

13. Product Metrics Continued…
Metrics that directly
represent the state of
various areas of the
product are called
product metrics
Product
Metrics
Activation Rate Conversion Rate Retention Rate Churn Rate
Resurrection Rate Daily Active Users WAU, MAU
Resurrection
Rate
Suppose an e-commerce platform identified 500 inactive customers (customers who
hadn't made a purchase in the last 6 months). Over the next quarter, they managed
to bring back 50 of these previously inactive customers to make a purchase.
Using the formula:
Resurrection Rate=(50500)×100Resurrection Rate=(50050​)×100
Resurrection Rate=10%Resurrection Rate=10%
Daily Active
Users (DAU)
=Number of unique users who engage with a product/service
within a 24-hour period
Suppose on a particular day:
User A logged in once.
User B logged in twice.
User C logged in once.
User D logged in three times.
Therefore, the Daily Active Users (DAU)
for that day would be 4 (User A + User B
+ User C + User D), as there were four
unique users who engaged with the app
on that specific day.
Weekly
Active Users
(WAU)
Number of unique users who engage with a product/service w
ithin a 7-day period
Same formula as DAU replacing day to week as measure duration
Monthly
Active user
(MAU)
Number of unique users who engage with a product/service w
ithin a 30-day period
Same formula as DAU replacing day to month as measure duration

14. Business Metrics
Metrics that directly
impacts the business
Business
Metrics
Customer Acquisition Cost (CAC)
Customer
Acquisition Cost
(CAC)
Suppose a company spent $10,000 on marketing and sales efforts (such as
advertising, campaigns, salaries, etc.) in a given month. In that same month, they
acquired 100 new customers.
Using the formula:
CAC=$10,000100CAC=100$10,000​ CAC=$100CAC=$100
Average
Revenue Per
user (ARPU)
Suppose a subscription-based company generated a total revenue of $50,000 in
a month from 500 subscribers.
Using the formula: ARPU=$50,000500ARPU=500$50,000​
ARPU=$100ARPU=$100
LifeTime Value
(LTV)
LTV=Average Purchase Value×Average Purchase Frequency×Customer Lifespan
Let's create an example to illustrate this:
Suppose a subscription-based streaming service has the following metrics:
Average monthly subscription fee: $20
Average customer lifespan (in months): 24 months
Average purchase frequency (how often a customer subscribes again): 1
subscription renewal every 2 months
Using the formula:
LTV=$20×12×24LTV=$20×21​×24 LTV=$240LTV=$240
In this scenario, the Customer Lifetime Value (LTV) for this streaming service is
$240. It means that, on average, each customer is expected to generate
approximately $240 in revenue over the course of their subscription lifespan.
Monthly
Recurring
Revenue (MRR)
Plan A: $50 per month with 100
subscribers
Plan B: $100 per month with 200
subscribers
Plan C: $150 per month with 150
subscribers
MRR=(50×100)+(100×200)+(150×150)
MRR=5000+20000+22500MRR=5000+20
000+22500 MRR=$47,500MRR=$47,500
Average Revenue Per user (ARPU)
LifeTime Value (LTV) Monthly Recurring Revenue (MRR)

15. Customer Metrics
Net Promoter Score (NPS)
Net Promoter
Score (NPS)
Suppose you surveyed 500 customers about their likelihood to recommend your
service:
Promoters (score 9-10): 200 customers
Passives (score 7-8): 150 customers
Detractors (score 0-6): 150 customers
Calculate the percentages:
Percentage of Promoters: 200500×100=40%500200​×100=40%
Percentage of Detractors: 150500×100=30%500150​×100=30%
Calculate NPS:
NPS=40%−30%=10%NPS=40%−30%=10%
In this scenario, the Net Promoter Score (NPS) is 10%. NPS can range from -100 (if all
respondents are detractors) to +100 (if all respondents are promoters).
App Store
Reviews
User rating between 1 to 5 (low to high)
Customer
Satisfaction
Score (CSAT)
Very Satisfied: 50 customers
Satisfied: 30 customers
Neutral: 10 customers
Dissatisfied: 5 customers
Very Dissatisfied: 5 customers
Number of positive responses (Very Satisfied +
Satisfied) = 50 + 30 = 80
Total number of responses = 50 + 30 + 10 + 5 +
5 = 100
Calculate CSAT:
CSAT=(80100)×100CSAT=(10080​)×100
CSAT=80%CSAT=80%
App Store reviews
Customer Satisfaction Score CSAT)
Customer
Metrics
Metrics that directly
represent the state of
various areas of the
product are called
product metrics

16. Framework (GAME) of metrics that matter
Product Life
Cycle Stages
Goal Actions
Metrics
(North Star)
Evaluation
Product
Discovery
and
Validation
Identify Problem
that is worth
solving
1. Large enough
market
2. Validated
Problem
End of this stage you should know
Problem
Solution Fit
Product that solves
the identified
problem for the
identified
customers
1. Paying
Customers
Product
Market Fit
Establishing a
repeatable and
scalable business
1. Daily Active
users
2. Conversion
Rate
3. Retention Rate
Business
Model Fit
and Scaling
Scaling the
business
1. ARPU
2. LTV
North Star metrics Example:

17. Product Analytics
All the analytics is based
on users and their
actions.
Actions of the users are
captured as event
Steps in performing product analytics:

18. Product Analytics platforms and capabilities
Usage of digital technologies is
critical to its value proposition
Customer acquisition and
distribution are based on digital
channels

19. Experimentation and Hypothesis Testing
Build-Measure-Feedback loop
framework was Introduced by
Eric Ries
Best way to continuously
improve the effectiveness of
products or features in cost
effective way
Hypothesis Testing
(based on Build-Measure-Feedback Loop)
Step Step Details
Step-1: Hypothesis
Creation
Example : UBER
if we make the booking flow
easier to use for senior citizens
Time Taken (for them) to make
bookings would reduce
They would book more, leading to increase
in revenue and retention
Step-2: Build
Minimum Viable product
Concierge MVP
• Make changes in booking flow
• Increase visibility
• Make location selector easier
Step-3: Measure
Define Success (Metrics to measure)
A/B test (Test Plan)
Step-4 : Learn
Identify which test path performed better
Which change brought the most significance and for which users

20. A/B Testing
A/B testing is also known as Split
testing that helps in testing the
impact of multiple changes
A/B testing indicates the impact
of changes, but it is not a
solution
12.5% is the equal
traffic % that will be
Redirected for testing
the plan
Path – 8 is indicates
that all three
changes C1,C2 and
C3 should be
deployed together to
have maximum
number of bookings
in minimum time and
maximum ARPU.

21. AARRR Framework – Pirate Metrics
The AARRR framework, also known as the Pirate Metrics, is a model used in the field of
growth marketing and product management to understand and optimize various stages
of the customer lifecycle. It was popularized by Dave McClure of 500 Startups and consists
of five key metrics that represent different stages of the user journey.
Acquisition
A
Activation
A
Retention
R
Referral
R
Revenue
R
How do customers find you?
How quickly can customer reach to Aha moment?
How many customers retain and why do we lose others?
How can we turn your customer into advo
How can you increase revenue?
The AARRR framework,
also known as Pirate
Metrics, is incredibly useful
in digital product
management for several
reasons like:
1.Comprehensive
Analysis
2.Identifying
Weaknesses
3.Metrics Tracking

22. AARRR Framework – Pirate Metrics - Acquisition
Acquisition
A
Activation
A
Retention
R
Referral
R
Revenue
R
The AARRR framework,
also known as Pirate
Metrics, is incredibly useful
in digital product
management for several
reasons like:
1.Comprehensive
Analysis
2.Identifying
Weaknesses
Acquisition
Funnel
Acquisition
Channels
• There are many different acquisition
channels that a product uses to acquire
users.
• Constantly look at all the funnels in
each acquisition channel and gauge
which channel works best
Acquisition
Metrics
• Number of Visits
• Number of registrations
• Customer acquisition cost (CAC)
• Conversion rate
Acquisition
A
Relevant for SaaS Business
Awareness
Consideration
Decision
Example

23. AARRR Framework – Pirate Metrics - Activation
Acquisition
A
Activation
A
Retention
R
Referral
R
Revenue
R
The AARRR framework,
also known as Pirate
Metrics, is incredibly useful
in digital product
management for several
reasons like:
1.Comprehensive
Analysis
2.Identifying
Weaknesses
Activation
Moment
Aha moment in different
products
Onboarding
Journey
• The first step by step journey where
user is being explained different areas
of product
• A good onboarding journey ensures that user
reaches to ‘Aha moment’ quicker
Activation
Metrics
• Activation rate = (number of user
crossing the activation or Aha moment
/ Number of registrations) X 100
• Daily active users
• Weekly active users
• Monthly active users
Activation
A
Example

24. AARRR Framework – Pirate Metrics - Retention
Acquisition
A
Activation
A
Retention
R
Referral
R
Revenue
R
Retention
• How many users retain on your product
• D0 = the day on which a user registered
• D7 = 7th day after the registration day
• D7 Retention = out of the total registered users
on D0, how many users returned and used the
product on D7
Retention
Indication
• Retention is an indicator of product’s growth
and success
Churn
• Acquisition rate > Churn Rate = Growth
• Acquisition rate < Churn Rate = Burning money
• New users + Retained users = Net growth
Retention
Metrics
• Retention Rate – D0, D7, D14, D28
• ARPU – D7 ARPU, D14 ARPU, D28 ARPU
• LTV (LifeTime Value) – D365 LTV, D180 LTV
• DAU, MAU
Retention
R
Example

25. AARRR Framework – Pirate Metrics - Retention
Acquisition
A
Activation
A
Retention
R
Referral
R
Revenue
R
Referral
• Making your current customers, your
advocates to drive more users to sigh up.
• Best way to drive growth because usually
acquisition cost is low
• Quality of customers coming from referral is
usually high
Referral
Metrics
• Who was referred and who referred them
• When was the user referred
• Referred user converted or not
• Viral Coefficient
Viral
Coefficient
• Viral coefficient is the number of users a
customer refers to you
• If K value = 2, one customer on avg. refers and
gets two new customer
Referral
R
Example
The AARRR framework,
also known as Pirate
Metrics, is incredibly useful
in digital product
management for several
reasons like:
1.Comprehensive
Analysis
2.Identifying
Weaknesses

26. AARRR Framework – Pirate Metrics - Retention
Acquisition
A
Activation
A
Retention
R
Referral
R
Revenue
R
Revenue
• Last but the most important for any product
• If AARR have optimized, Revenue should be the outcome
• Revenue is an indirect impact from each stage
Revenue
R
The AARRR framework,
also known as Pirate
Metrics, is incredibly useful
in digital product
management for several
reasons like:
1.Comprehensive
Analysis
2.Identifying
Weaknesses

27. https://www.linkedin.com/in/swadesh-bhushan/
swadeshbhushan@gmail.com
S
Thank you!
Feel free to reach out to Swadesh Bhushan , Product and Program Leader – having 20+ years of versatile experience in
IT industry.