Product engagement

What is product engagement?

Product engagement focuses on how customers or users interact with a product. It aims to provide an in-depth understanding of customer behavior by analyzing interactions at a granular level, helping to maximize engagement with and usage of your products.

Product engagement is dependent on a number of aspects and, as such, tracks different metrics, including product usage frequency and depth of interaction.

Why is product engagement important?

Measuring product engagement gives you an idea of how people interact with your product and its overall value. Understanding your target audience, including how and when they use your product, will help you determine how to retain old customers and acquire new ones.

Product engagement also helps identify problem areas and product features that need improvement. Ultimately, the objective is to increase product or brand visibility and create more value for the customer.

How do you measure product engagement?

There’s no single metric that provides an accurate representation of product engagement. Instead, you’ll need to consider a combination of factors that can help provide insight into observable customer and user behavior. Product teams should decide at the onset how people should engage with certain products and then track actions and behaviors using set KPIs.

In the case of web and mobile apps, the most common metrics include daily app usage, visit duration, number of screens per session, time spent on each screen, and number of actions per user.

What are product engagement metrics?

Different organizations use unique metrics to measure product engagement. While some businesses might base product engagement on custom fields, most focus on frequency, depth, and breadth metrics.

CRM company Apptentive, for example, relies on mobile surveys to get qualitative information about their customers, which helps convey overall customer sentiment. In 2020, Apptentive found that the number of surveys sent through their platform increased by 50%.

The pandemic drastically increased mobile engagement and helped customer-facing teams become more comfortable communicating with customers on a regular basis.

What is a product engagement score (PES)?

A product engagement score (PES) combines various metrics to provide a holistic view of customer engagement, including average user stickiness, feature adoption, and customer retention. It’s a good indicator of how a product is performing and how it can be improved. 

To calculate your PES, determine your stickiness (daily/monthly active users), feature adoption (percentage of daily/weekly adopters of your product’s core features), and retention (percentage of retained customers after three months). Digital adoption platforms can assist in your calculations by providing the data and visibility needed to make data-driven decisions that help in creating a product strategy based on customer feedback and behavior.

SaaS product engagement metrics

Software engagement metrics are designed to measure user behavior and habits that are related to your products. These are not to be mistaken with business metrics, which are more general and encompass several aspects of the products and business. SaaS product engagement metrics include:

  • Active users
    When calculating the number of customers using your application, it might be useful to look at daily, weekly, or monthly active users, which can help provide insights into user adoption of a new feature. 
  • Usage and behavioral metrics
    Most companies look at feature adoption, time spent on application, and number of screens or pages displayed per use as indicators of how customers interact with an application. Usage metrics help in determining what to improve and whether or not the application is providing optimal customer value. 
  • Net promoter score (NPS)
    NPS is a vital metric that calculates loyalty to your application or product. NPS also helps segment users by location, use case, and other categories, and can help determine customer satisfaction and steps to address problems.

How do you increase product engagement?

Customer feedback is the backbone of improving product engagement and is vital in ensuring the success of a product or service. The following three steps can help greatly increase product engagement:

  1. Capture
    Ensure that you have an effective system in place that constantly captures customer data, which can help you make sound product and business decisions. 
  2. Analyze
    Dive deep into data to determine what is relevant to your business. Data is useless if you can’t find ways to comprehend it and transform it into actionable insights. 
  3. Act
    Once you find the data you need, start answering product questions and build features into your product roadmap. Ensure that whatever features you add provide value to your customers – adding unnecessary features often detracts from product value and usability.

How to build a product engagement strategy

Brand loyalty is something that should be built and maintained to ensure long-term success. It’s not always simple because customers expect brands to anticipate their needs. This can only be achieved through a strong product engagement strategy based on fresh data and innovative ideas. 

Below are a few key points that will help in the creation of an effective product engagement strategy:

  • Ensure real-time customer engagement using tools like live chat.
  • Deliver consistently great experiences across all channels.
  • Personalize conversations using video chat tools.
  • Increase customer engagement using in-app messaging.
  • Regularly collect customer feedback to continuously improve your offerings.
  • Increase brand loyalty through incentives and customer loyalty programs.
  • Constantly measure product engagement metrics and see where there’s room for improvement.

Examples of product engagement platforms

Because product engagement is measured differently by different organizations, the software used to measure it also varies. Below are common examples of systems used by companies to measure product engagement:

  • Messaging software
    Messaging tools designed for prospect engagement can also be used in external customer engagement. Customers using these tools to ask questions or get support present an excellent opportunity to communicate with them and build lasting relationships. They can also be used to get feedback and understand pain points. 
  • Video chat tools
    Taking the time to communicate with customers through video calls helps ensure that they remain engaged. Video chat tools can be used to create new bonds and strengthen existing ones, whether it’s through a one-on-one call or a scheduled learning session or webinar. 
  • Online community software
    An online community provides a branded and centralized space for customers to connect with you and each other. It’s a place where customers can ask questions, discuss product features, and share feedback and reviews, as well as a great venue for developing brand loyalty. 
  • Product adoption software
    Acquiring new customers leads to a more complex onboarding process, especially since onboarding should be a personalized experience. Digital adoption platforms help streamline the onboarding process so it can be scaled as the organization grows. 
  • Learning management software
    Providing learning opportunities is an excellent way of increasing customer engagement and enhancing the overall customer experience. Using online course systems allows customers to learn at their own pace and encourages them to participate in more learning programs. It also provides a platform where they can engage in asynchronous learning with other customers.

Product engagement vs product adoption

Although high product engagement leads to product adoption, these two concepts aren’t the same. Product engagement aims to influence customer behavior so that they continue using your product or service. It’s typically measured by social media interactions, content and media consumption by customers, product event attendance, and referrals. 

The objective of product adoption, on the other hand, is more direct. It refers to the actual consumption or usage of your product or service based on usage events. These usage events can be any type of action or series of actions that you want your customers to do with your product.

How product engagement can help digital transformation

Providing the best customer experience possible has always been the goal of every company, regardless of the products they offer. As such, new ways to keep customers engaged are being used to complement traditional ways of communication so that a seamless experience is provided and maintained. 

Making connections has never been so valuable in business; in today’s highly competitive landscape, connecting with customers via social media and other channels is a necessity. Companies should also ensure that internal systems are interconnected as part of an effective digital transformation strategy. Ultimately, product engagement ensures that companies know what customers need, how to give it to them, and where.

Published: March 30, 2022

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