Can you lose product-market fit? Balancing data and customer stories

Highlights

How did you start your journey into product management?

Ramli: My journey actually started in marketing. I was leading marketing for a VC- backed company before. My role was to get free signups.

And before that, it wasn't called product-led growth. It was just “Ramli, get us more sign-ups!” I was like, okay– I'm getting signups. I'm hitting the sign up goals that they have for us. And I started asking them, “one second... are the people who are signing up for our product actually using it? Are they experiencing the value? Are they sticking around?”

Once I got access to their backend, I noticed there were a lot of people signing up. But a lot of them are getting stuck somewhere. And that's what really caught me into the deep end with product growth. It really helped me to start understanding how our product can really drive growth for our business and help our customers experience the value.

And after that, I got connected with Wes Bush who wrote the book on product led growth. Now I've been helping different product teams really understand that if your product is not optimized for growth you’re just wasting marketing resources. You need to think about how to drive growth across the whole journey and not just try to get more signups.

Can you talk about how you define product sense? When you’re working with an organization, how do you assess whether a PM has product sense?

Ramli: A lot of people think product sense is like a sixth sense. But it really isn't. Product sense is a skill built upon one thing– empathy. And I know product managers are like, “ah, man... Ramli, we've heard this before.” But how can we really define empathy?

I look at it as somebody who understands their customer holistically. Meaning, they understand what their customer is trying to do. That's the first piece of empathy, the functional piece. The second is the emotional piece. Our customers are emotional beings. So PMs need to understand what those customers are feeling when they first use your product. Or, what you don’t want them to feel. This might feel a little weird to consider.

But when I think about the very first time I used Calendly to book a meeting, six years ago, there's a feeling of excitement. There's a feeling of joy. There's a feeling of, “Goodness, I didn't have to go back and forth by email! There's that emotional piece to every product, which is a big part.

And then the third piece of us as human beings– we're social creatures. We care about our boss, our colleagues, our friends and family. What do they think about us? This is true even in a B2B sense.

For example, when you send a Calendly link to your guests, you think to yourself, “what are they going to think about me? Am I going to look stupid If this fails?”

Here’s another example. With a lot of reporting tools, when you create a beautiful report, You want to look professional to your boss so that they eventually give you a promotion, right? So even B2B products, I would argue, have an emotional and a social piece to it because no human is an island.
And whenever we use products, it often requires us to interact with other people. So I think product sense is built upon that empathy where you fully understand the functional, the emotional, and the social piece to your customers who are using your product.

Latif: I really like that. One of the words that I try to often use that may sometimes be a little bit more broad is “perspective.”

Although empathy does have a certain ring to it these days, perspective allows you to see your product from the lens of multiple customers. I don't have to just empathize with one point of view. I can see the whole broader picture.

There’s big tech companies out there like Facebook that only make decisions based on data. In those cases, product sense isn’t something that’s nourished. Is it necessary in all companies?

Ramli:I love what you call it– perspective, a holistic perspective of what their customers’ uses are. Both sides of the coin. When you're data driven, you're looking at purely numbers. What is the conversion from inactive to active? Active to power user? That's only one piece of the picture. But to really have a deeper understanding of how your customers are doing, you really need to be plugged into that product sense.

You really need to understand those customers. And there are studies shown by CoSchedule and ProfitWell that the ones that continually talk to their customers and ingrain product sense– their perspective of their customer, the voice of the customer or whatever you want to call it– they can grow two to three times faster than ones that don't.

That can be outliers like Facebook. But when you understand that you can lose product market fit, you really start to prioritize speaking to your customers. You can lose product market fit once you've gained it because the market can be moving.

And now, if you're not talking to your customer, you're not getting a sense of the market. You can get your lunch eaten. An example I can think of is Airbnb. Airbnb- they had product market fit. Then guess what something happened? A pandemic.

We need to shift with the market or else we're not going to survive as Airbnb with all the things that are happening. They really had to shift the way that they deliver and communicate the message. It’s been said that the fastest company wins.

It's not the biggest. You really need to have a sense of that product sense throughout your organization, because you might be left behind if the market moves without you.

Latif: That's a really great point. Five to seven years ago, the average SaaS company had three competitors.

Now it has nine. I know everyone likes to tout “ignore what your competitors are doing and watch what your customers are doing.” That only goes so far. When we talk about these markets changing, people are trying to find a way to get their intuitions more honed.

Can you give us an example of someone who has honed that product sense to be able to handle a black swan event like a pandemic?

Ramli: I can think of many stories where the central question was, “how do we engrain our customer's stories? How do we engrain that, that perspective in our organization?” And that needs to really start from the top. The leadership,

I had a chat with Yulia. She leads the growth at Miro, the collaboration tool. She said that at some quarterly meetings, they would actually fly their customers in to tell stories of how they're using the product.

And that does a few things. The first is it gets your team excited and pumped up that you're not just building a product. We're here to upgrade people. We're here to help people be better than they were before they touched our product. There’s a quote on this I really like from Kathy Sierra.

She wrote this book called “Badass: Making Users Awesome.” She said, “don't upgrade your camera. Upgrade your photographers.” That’s the reason why when you’re building products you need to think about how your users will be upgraded by using it. That's one example of how you systematize that empathy and perspective for your organization.

One way could be like, “Hey, let's add more stories in our meetings.” How do you share those stories across your organization? So it's not just the product team or the user research team that is really ingrained in that. This builds that sense throughout the whole organization so that they are truly aware of what your customers are feeling.

What does my customer think? What is their social setting? It's like starting by sharing stories because stories are great. We love stories. It's the earliest form of entertainment, right? Before movies, before Netflix, before Spotify, all of that, the way that we entertain ourselves is by telling stories.

And that's very rooted in us. Those stories really do connect us.

Latif: I think back to the times that we've had customers come and present to the company. Those have been the most impactful moments.

I think people hang on their words and quote those customers because we're not necessarily all customer success or salespeople interacting everyday. I remember we had a really famous bank in Canada as a customer. They came in and they said something that I had never expected. They said, “our culture of product management was really closed and we didn't share. But using Roadmunk changed our culture to be more open and transparent.”

Up until that point, we had never heard it from that cultural perspective. Everyone in the room truly, emotionally connected with that customer and got that perspective. And a lot of people who may work behind the scenes in the business were hit by that. It was a real motivator and is a real motivator continuously.

So, I think that's such a great point when people are bringing those customer stories. Not just written in Slack or shared on an email. Those are great, but bring them to present to those quarterly meetings. I think that's so powerful to start and open with that. And to challenge people to think in those terms when setting up their next offsites.

Ramli: Sometimes product folks get caught up with it with the data and the design and pushing people to do stuff and they don't realize that they don't see the impact.

And I guess when this happened it just got everybody excited around your product even more. Is that what you found?

Latif: Oh, absolutely. They were politely interrogated for the next hour with questions about how they use certain features and what they wish they could see in the product.

It’s all the questions you want to hear asked, but being asked by people that you wouldn't necessarily expect to ask. And I think that's a really powerful thing because of that engagement with the organization. And you can just see those social connection points to further create a relationship between the user and the people building the product. I can't think of anything that could be more powerful than that. This is a big part of nourishing product sense in an organization.

Building a new product versus improving an existing one presents different challenges to product managers. What kind of product sense does a PM need in each of those scenarios?

Ramli: With a new product, PMs need to understand the functional, emotional, and social pieces I mentioned earlier. They might need to work with product marketing to figure out messaging and positioning here.

That's for new products. But if you’re trying to improve an existing product, you’re lucky in that you already have an existing customer base. Leverage them. Try to find your best customers. Ideally the ones that bought without having to talk to sales.

What kind of things do they care about? Look for the friction points in the product that you can make easier for them. How can you make their life better? Remember, upgrade your user.

How do you handle situations where a PM you’re working with is leaning towards a direction that doesn’t align with the product sense path you think is best for them?

Ramli: We work with this company that helps people create designs easily very much like what Canva does.

And one thing that the product team was really stuck on was 2-step email verification. Their data was showing that 30-50% of new users were not verifying their emails and going through the extra steps. Their users were stuck and were not continuing onboarding.

So we did some usability testing where we walked through onboarding with users. Getting to hear first-hand from users how annoyed they were at the current process gave us the data that we needed to iterate.

When we finally got the company to change their onboarding process, we saw an immediate increase in terms of their people activating, creating that first value point, and finally experiencing the product.

Are there situations where it can be harmful to have or rely too much on product sense?

Ramli: That goes back to when the market is shifting. In those situations I would be very wary when instinct is fully trusted. I would marry that with quantitative data as much as possible. Don’t base your decisions all on one person’s instinct. That person can’t be right all the time.

For those who are listening and are trying to come up in the profession of product management, how would you coach them?

Ramli: Personally, I'm a natural introvert. So my natural instinct is just just data, data, data– and I'm fighting that. I'm finding that I'm coaching myself to just talk to customers. The closer you are to the customer, the greater the product that you can build.

You're building a product to serve people, to make their lives better. So, that's one thing that I'm continually coaching product folks on. There’s a really fascinating stat from CoSchedule that says 65% of product teams don't actually talk to their customers.

This is what the reality is. People are pressed for time. Talking to customers does take more time and effort, but I’m always surprised when I do get around to talking to customers.

It can’t just be sales or customer success that talks to customers. Then you don’t get to bring in those stories. You can’t rely on just secondhand information.

So please, build that habit into your team. It’ll help you build a much better product.

I see you’ve got a PLG hat on. What are some of the fundamentals that companies need to understand when going down the product-led growth path?

Ramli: For a lot of sales-led companies, this is what the traditional flow would look like; a prospect requests a demo, you have to give them a great first product experience, and then its on the salesperson to close them. What I’m finding is that a lot of larger sales-led companies are starting to make the move to product-led growth.

But when doing so, there's this whole change management piece that a lot of product-led product leaders need to have. And that often means having diplomatic skills and really sharing how the product can help the sales team.

This is all about listening to how the sales team works to understand what is valuable to them.

A company I chatted with recently told me their sales cycle was usually six months long. After helping them take more of a PLG approach, they saw a customer convert within 3 days at a $10k/mo price point. And the team was blown away.

When the sales team saw this, they knew they needed to get on board. That's one example. I’m picking on sales teams a little bit because they usually freak out and worry that they’ll be replaced if PLG is implemented in an organization. But really, it’s about those two working together for the whole company.

So, why would a company need a dozen sales reps then?

Ramli: I actually don't think product led growth pure by itself is, is the best. Often the best organizations are ones that are hybrid. For example, look at Slack. We often think they’re just product-led.

But in the last 2009 stock filing, they have 60% of their sales come from salespeople. So sales is super important in a product led organization. That example that I gave you, there are people who sign up that they don't want to talk to sales. They just want to sign up. There are some who want to try it first and they actually want to talk to sales after, but there are other people they're just way too busy and they, they just want to talk to sales from the beginning.

This hybrid approach actually actually gives power back to all the different customers you might have.

You wrote a book on product-led onboarding! What were the insights you gleaned that the audience can take away from?

Ramli: My past life as a marketer is what inspired that initial idea. Remember how I was pressured to just get sign-ups? Chasing sign-ups is really like throwing a party.

They shell out cash for the ads. They put up the poster on the college campus. But when people come to the party, no one’s friendly. The party host doesn’t even welcome the guest or show them around.

It just is not a great experience. The chance of that guest coming back is not going to be high.

But when you create a great party where everyone is vibing and connecting, people can’t wait to come back to the next one. They’ll even invite their friends to the next one. Happy party guests want to personally thank the host– you might call this person an account executive of a customer success manager.

This will help you create sticky customers with high customer lifetime value.

About Our Guest – Ramli John

Big thank you to our guest, Ramli John, for joining us on this episode of Product to Product! To learn more about his product thinking, check out him at the links below:

Twitter: @RamliJohn
LinkedIn: /RamliJohn
Learn About Product-Led Onboarding: onboardingbook.com
Buy Ramli's Book: Amazon