Proving product marketing team value begins with measuring your success. The following product marketing metrics & KPIs influence how we make decisions at CoSchedule and communicate our success.
Read on to learn the fundamentals of measuring product marketing performance and see the types of metrics that work for us. You’ll learn the definitions of these metrics, how to calculate them, and what makes them essential in strategic decisions.
What Is Product Marketing?
Product marketing is all the processes that go into promoting a product, finding its position in the market, and communicating its value to customers. A comprehensive product marketing strategy intersects with the sales, marketing, and development that goes into the product.
You’ll see most product marketing efforts concentrated near the end of the marketing funnel. But it’s a practice that applies to all stages.
What Is The Goal Of Product Marketing?
While everyone has different goals behind their product marketing strategies, these objectives often relate to acquisition, activation, adoption, retention, and revenue metrics. In other words, they track how customers pick up a product and what works best to keep them around.
At CoSchedule, we’ve learned to take some of the deepest-funnel metrics with a grain of salt regarding product marketing.
Product marketing must make a product promise with positioning and help users live that promise. That means the product itself must follow through.
This is where there are so many decisions prospective customers make that are outside a product marketing team’s control. You must collaborate with sales, product, and customer success teammates to learn and iterate.
What Are Product Marketing Metrics?
A product marketing metric is a measurable variable you can track to understand your product marketing performance.
Many of these metrics overlap with other marketing fields, sales, and product development metrics.
What Are Product Marketing KPIs?
Product marketing KPIs are product marketing metrics that measure progress toward your marketing goals.
For the best results, stick to three to five highly focused KPIs to track. You’ll have an easier time defining your success with a concentrated approach.
The following metrics relate to the top of the funnel — the stage where customers figure out what problems they need to solve:
1. Product & Pricing Page Visitors
These traffic metrics count the people who visit your product and pricing pages.
The number of visitors you get on these strategic product messaging pages shows purchase intent and product-market fit. You’ll discover how many people want to learn more about your product and if they’re considering buying it.
You can track your visitors with a website analytics tool like Google Analytics.
Pay attention to your unique visitors and total visitors. The unique visitors metric shows how many distinct people viewed your page, while the total visitors metric covers all visits regardless of the person.
2. Lead Magnet Downloads
Lead magnets are resources you offer in exchange for a visitor’s email address. The most popular lead magnets are PDFs such as reports and ebooks. But they can also refer to online experiences like calculators and downloadable templates.
Your number of lead magnet downloads indicates how many people are interested in your brand-related topics. These people could make good marketing qualified leads (MQLs), meaning they’re ready to receive ongoing marketing from you.
Your ideal method for tracking lead magnet downloads depends on how and where you host the file. If you use a third-party file-sharing service, it may have download tracking built-in.
When you host your download on your website, you have a few ways to track its numbers in Google Analytics.
Now, we’ll look at metrics related to the middle of the marketing funnel. At this stage, customers know what problem they need to solve, but not all the available solutions.
3. Trials & Freemium Signups
When someone signs up for a free trial or plan for your product, they might also show interest in the paid version. Your total registration count relates to the number of people getting closer to becoming paid customers.
Every company’s lead qualification process varies, but trial and freemium signups tend to signify a move to MQL or sales qualified lead (SQL) status. If a prospect seems to be already an MQL according to other trends, a registration could get them ready for sales to start contacting them.
4. Discovery Calls Scheduled & Completed
Your total discovery calls have similar things to say about lead qualification as trial and freemium signups. When you see that number increase, you’ll know you have more prospects thinking of paying for your product.
Discovery calls aim to nurture a lead toward buying a product by introducing them to your product. Someone’s interest in one of these calls generally qualifies them as an MQL.
Using a preset or custom field, you can track your discovery calls in your customer relationship management (CRM) software. The same principle applies to the other types of calls we’ll cover in this blog post.
5. Lead Acquisition Cost
Also known as cost per lead (CPL), lead acquisition cost is the average cost of obtaining a new lead.
Since it’s difficult to determine this amount for your marketing overall, marketers calculate lead acquisition cost by campaign. Useproof calculates it with this formula:
Lead acquisition cost = Campaign’s total cost / Number of leads generated by that campaign
To get your total campaign costs, track all the labor and resources that go into it, including wages and overhead. A lead counts as someone whose contact information you received from the campaign.
After calculating lead acquisition costs for your campaigns, you’ll know which ones provide the most budget-effective solutions.
Let’s look at bottom-of-the-funnel metrics now. These measures relate to customers ready to buy a solution to their problem — a solution that could be your product.
6. Demo Calls Scheduled & Completed
Demo calls involve a live, video, or interactive demo your salesperson walks a prospect through over a call.
Someone who wants to take the time to demo your product has at least some interest in buying it. This connection makes demo call metrics important for gauging how many customers you have at the bottom of the funnel.
These bottom-of-funnel metrics show your sales and marketing effectiveness near the end of the lead nurturing process. If you have a lot of demo calls but not many sales, you might need to address your bottom-of-funnel sales processes.
7. Quote Calls Scheduled & Completed
When a prospect comes to you for a price quote, they’re as close to becoming a customer as they can get. They now want to get a number to influence their final decision.
Your quote calls metrics show how many people get to this final stage of consideration.
They can also help you understand how your pricing affects your product’s marketability. You might need to reconsider your price if you see many deals going cold at the quote stage.
8. Deals Won
This is a classic sales metric: the number of sales interactions that turn prospects into customers. A won deal means your sales team convinced someone to buy a product or open an account.
Monitor your deals won in your preferred CRM. These tools track this metric by default.
As your business scales, the number of deals won will also typically increase. It makes a great metric to watch to keep an eye on your sales team’s performance.
9. Sales Win Rates/Close Ratios
Since the deals won metric doesn’t give the context of the number of deals your team manages, many sales teams track sales win rates. This metric compares deals won to the total number of deals.
Sales win rates reveal your sales team’s performance while accounting for how many deals they handled.
As Zendesk explains, you calculate this metric by dividing your number of deals won by your number of total deals, like so:
Sales win rate = Deals won / (Deals won + deals lost)
You’ll find all these numbers in your CRM.
10. Customer Acquisition Cost (CAC)
Customer acquisition cost (CAC) is the total money it takes to turn a lead into a customer.
This metric shows the cost efficiency and effectiveness of your marketing and sales efforts. A high CAC could mean you could use your budget more effectively or need to improve your marketing efforts.
Calculate CAC with the following formula:
Customer acquisition cost = (Total marketing costs + total sales costs) / Number of paying customers gained
Track your costs in your preferred accounting software and find your number of new customers in your CRM or subscription management platform. You can break up your CAC calculations by campaign or month.
11. Lead To Paid Conversion Rates
The lead-to-paid conversion rate measures the number of customers a marketing effort converts from leads. You may also know it as the lead-to-sale conversion rate.
This metric demonstrates how effectively a bottom-of-the-funnel marketing campaign turns prospects into leads.
Here’s how Chili Piper calculates the lead-to-paid conversion rate:
Lead to paid conversion rate = Converted leads / Total leads
Since your existing leads roll over to the next month, consider analyzing your lead-to-paid conversion rate by monthly cohort.
Let’s say you created 1,000 leads in August. Within that cohort, you could calculate how many people converted to customers in August and how many converted in September.
12. Days From Lead To Paid
This metric tracks the number of days it takes, on average, for a lead to become a paying customer. It determines the length of your sales funnel.
CRMs tend to measure this metric for you or present related metrics. Look for data fields related to sales cycle length, time spent in stage, or deal velocity.
With this metric under your belt, you’ll know how long your sales pipeline usually takes. You can also use it to calculate pipeline velocity — how that speed relates to revenue.
Once a prospect makes it through the marketing funnel and becomes a customer, you’ll still need to manage your product’s ongoing use. These product marketing metrics handle product usage trends and their impact on your revenue.
13. Adoption Rates
An adoption rate refers to the number of users that take on a feature or product compared to the total number of users.
Consider calculating the adoption rate for a new product or feature when you want to see the exact proportion of your user base interested in it.
Here’s a basic formula for determining the adoption rate:
Adoption rate = Number of users adopting a feature or product / Number of total users
Track the number of people using a feature or product using your favorite product analytics app or an in-house solution.
You could also take a page out of Userpilot’s book and calculate the adoption rate by dividing the first figure by the number of users exposed to the product or feature.
14. Active Use
Active use covers three metrics — daily active use (DAU), weekly active use (WAU), and monthly active use (MAU). All three track how many people use a product within a specific period.
As Baremetrics points out, each company measures active users differently. You might count active use as a sign-in or a specific action.
Once you figure out how you want to define active use, track that action in your product analytics platform by day, week, and month.
15. Net Promoter Scores (NPS)
Net promoter score (NPS) is a standardized measure of how likely a customer is to recommend your product to a friend. It runs on a scale from one to 10, with 10 being the most likely recommended.
Your customers’ average NPS reveals their potential to act as brand advocates for your product.
Since it takes a single question to get an NPS, you can record it through in-app or email surveys.
16. Days To Break Even
Days to break even measures the time it takes to regain the costs of a new product or feature. Calculating the days to break even will help you gauge the effort needed to make your investment back.
You’ll need to do a few calculations to find the days needed to break even.
First, use Freshbooks’ formulas to find your break-even point by product units or dollars.
Then, look for your average revenue or units produced per day in your accounting software and sales records.
Finally, use this formula to get your days to break even:
Days to break even = Break-even point / Average revenue or units produced per day
Keep your measurements consistent in this formula — divide dollars by dollars or units by units only.
17. Expansion Revenue
Expansion revenue is the extra revenue that comes in addition to a customer’s initial purchase or plan. This money comes from upgraded plans, add-ons, and additional products.
Since you manually calculate expansion revenue per user, using a product analytics tool that tracks this metric automatically is the easiest.
What does expansion revenue say about your product? Profitwell explains that it helps you identify its value, test pricing, and understand how your users adopt it.
18. Customer Lifetime Value (CLV) & Retention Rates
CLV covers all the value customers generate during their relationship with your company. Meanwhile, customer retention rate tracks the number of customers who stay as customers.
You can calculate CLV with this formula:
CLV = Monthly customer value x Total months as a customer
Both of the metrics needed appear in CRM and product analytics tools. Many product and subscription analytics tools calculate CLV for you.
Start calculating customer retention rates by choosing a period and noting the number of customers you had at the start and end of that time. Find these metrics in your CRM or product analytics platform.
Then, use this formula:
(Customers at end of the period – Total new customers) / Customers at the start of the period