Everything I Know About Product Experience [+ 4 Key Product Elements]

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As a marketer, I've had to use products that cut across CRM, instant messaging, scheduling, project management, and many others.

These software products caught my attention through various forms of marketing. But marketing is insufficient to keep anyone as a customer, no matter how brilliant it is. The core element that makes me continue using software is my product experience (PX).

In this article, I will explore what product experience means, why it matters, and the key elements that help brands make their products stand out.

In this article:

• What is product experience?
• Product Experience vs. User Experience
• The Importance of Product Experience
• The 4 Key Elements of Product Experience
• Designing Product Experiences That Count

A great product experience is prioritized by companies focused on customer-centric marketing, where customer feedback is at the forefront of product updates.

There's no perfect formula for a successful product experience. As David Pereira, CEO of Omoqo GmbH, explains, brands only need to focus on three key stages:

• Product strategy (deciding the direction)
• Discovery (building the product)
• Delivery (releasing it and gathering feedback)

Product Experience vs. User Experience

While product experience covers the entire customer journey within a product, user experience (UX) is much wider.

According to Don Norman, the co-founder of Nielsen Norman Group and one of the first persons who coined the term user experience, "User experience encompasses all aspects of the end-user's interaction with the company, its services, and its products."

While there can seem like a lot of overlap here, I like to differentiate the two by reminding myself that PX is the customer journey within a specific product, while UX looks at the user's broader interactions.

Product Experience vs. Customer Experience

Product experience and customer experience (CX) also differ.

I consider customer experience a broader term that describes every touchpoint a customer has with the brand beyond the product itself. As I mentioned, product experience covers the entire customer journey within a product. However, customer experience covers the whole picture - including product, marketing, customer service, and branding.

A great customer experience will quickly increase word of mouth for your product. For instance, a simple word from a fellow marketer I trust is sufficient to make me buy a product. That is what a great CX looks like. But what keeps me as a retained customer is a great PX.

For example, below is a Slack conversation I had with some colleagues - you can see how CX pulled me in, but the PX is what will keep me using the product (or have me abandon it).

Source

Improves Product Value and Revenue

An excellent product experience increases how quickly (time-to-value) new users see value in your product. The more effective your product experience is, the faster this happens, but this timeframe varies by industry.

In a recent product metrics survey of 547 SaaS companies across seven industries, the average time to value was 1 day 12 hours. I don't think this time is bad, but what's not good is what companies lose by resting on their oars. According to the same survey, a 25% increase in time-to-value brings a 34% increase in monthly recurring revenue in a year.

Pro tip: I recommend a simple onboarding process to help customers get more value through their product experience. By cutting unnecessary steps and using pre-built templates, in-app guides, or user manuals, new users can get on with what they want and derive value. Software products can also highlight key features with hotspots, banners, or tooltips to guide users effectively.

Raises Customer Retention

Customer retention is famous for being cheaper than customer acquisition in the product space. However, in an interesting article by Emanuele Porfiri, the senior data analyst at FT Strategies, only 24% of subscribers typically renew after the first month. While this raises a question about the worth of monthly subscribers, I prefer to focus on the solution, with one being to improve the product experience.

With a strong product experience, I believe businesses can increase this percentage to create consistent growth and a reliable revenue stream.

What this looks like in practice: When grammar checkers like ProWritingAid and Grammarly send me my weekly achievements with their products, it drives me to use the product the next week. Such a simple action creates a great impression and makes me continue as a customer.

Onboarding is another element that sets the tone for a user's journey. If it's seamless and engaging, it can build trust immediately. But beyond onboarding, your product must address real customer pain points.

One of the recent cautionary tales is that of Tupperware. They shifted their focus to branding and image, ignoring customers' need for affordable, high-quality products. This misstep led to bankruptcy, showing what happens when a brand loses touch with its audience.

Increases Referrals

I've lost count of how many times I've recommended a product I love. If I enjoy it and it works, I share it on my blog, in Slack groups when members ask, or on LinkedIn. (You saw it in practice in the Slack conversation I shared above!)

Turns out, I'm not alone. Studies show that 94% of customers are happy to recommend brands with great products and excellent service. In my experience, the product matters most. If it's exceptional, customers rarely need much support. A great product experience is the real test of your customers' satisfaction and loyalty. It speaks louder than any marketing campaign ever could.

A perfect example of referrals in action is the story of DANG, an international skincare brand. When I talked to the founder, Ifedayo Agoro, she said referrals have become their growth engine because their product works.

"We're a very tightly knit community of women, so it makes sense that when someone discovers that Dang skincare works for them, they tell their friends, family, and coworkers. Sure, we run other marketing campaigns, but honestly, most of our new customers and Instagram followers come from good old-fashioned recommendations," says Agoro.

Increases Trial-to-Paid Conversion Rate

Before SaaS products, companies gave out free samples of physical goods so potential customers could try them out. Whether someone became a paying customer depended entirely on the product experience and quality.

The same principle applies to software: a great product experience turns free users into paying customers.

Beyond making the product easy to use, there are several ways I've seen different software companies attempt to convert me as a user:

• Using welcome surveys to collect my information and personalize my experience.
• Including in-app product demos that show paid features.
• Providing virtual and interactive walkthroughs within the product.
• Presenting upgrade prompts to higher product tiers.

The 4 Key Elements of Product Experience

Feedback, analytics, prioritization, and clarity are the four key elements that can help you create a great product experience. Let's dive into each:

1. Feedback

In the 2024 State of Product Management report, 99% of product managers say customer feedback is vital and responsible for the biggest increase in product effectiveness. This feedback can come in structured (surveys, interviews) or unstructured (customer service conversations, sales interactions, community conversations) formats.

Agendor, which provides web and mobile solutions for sales professionals, is one brand that can testify to the impact of structured surveys.

When the CTO, Tulio Monte Azul noticed their mobile app wasn't as popular as the web version, he did a survey and found the complex onboarding process as the culprit. In response, his team shortened and gamified the onboarding process, resulting in a surge in mobile users and improved product value.

For new products, community conversations are one of the easiest ways I have seen early-stage founders get product feedback. This feedback could come from sites like Product Hunt, where founders generate buzz, or Appsumo, where they generate paid users and gather tons of useful feedback.

Pro tip: When using feedback, I'd recommend you tread carefully and handle it well. Don't over-rely on input from just a few power users. This can skew your product updates and alienate the desires of most users. And don't ignore negative feedback, too. While they are easy to dismiss as outliers, negative comments can highlight issues you must address to improve the overall product experience.

User research and feedback shouldn't be a one-off task. Make it a continuous part of your product development process. Regularly check in with users to ensure your product evolves with their changing needs and expectations.

2. Analytics

In the past, companies relied on anecdotal observations, gut instincts, and the opinions of the loudest stakeholders to determine product improvements. Today, companies use data analytics tools and AI forecasting to analyze data and gain insights to create a great product experience.

However, without these sophisticated tools, you can manually sift through data and feedback with different departments. While this is time-consuming, it offers a more human perspective on how each team member might solve user issues.

A common issue that delays product teams from moving beyond the analytics or discovery stage is the belief that they need more data or user feedback to gain accurate insights. In an episode of The Product Experience Podcast, Frances Ibe emphasized that no set amount of data is required to provide useful insights. She describes searching for user insights as "a goal that is progressively moving forward, which shouldn't stall the product team."

In his newsletter, The Product Pulse, Sandeep Singh Rajput also highlighted a key analytics pitfall: confirmation bias. This is when you search for data and insights that confirm pre-existing beliefs about the product, causing you to ignore valuable insights that challenge your assumptions.

To avoid this, Sandeep advises approaching user research with an open mind and asking questions that challenge your beliefs, allowing you to uncover the real needs of your users.

3. Prioritization

All product development requires prioritization to decide what to build and when. In terms of product experience, prioritization should be driven by analytics and user feedback and not by what the company wants to achieve, which may only sometimes align with user needs.

The impact of doing the latter has resulted in 80% of SaaS features going unused.

The cost? An estimated $30 billion in wasted research and development - a clear sign of a sub-optimal product experience.

One way to prioritize product tasks is by assessing the risks involved in delaying or advancing each task. These risks can be measured against user experience impact, technical feasibility, and alignment with business goals.

Another approach is to have open-ended conversations with customers to gain deeper insights into pain points. This method comes after gathering and analyzing initial feedback, providing the product team with a comprehensive understanding of customer needs.

Unfortunately, stakeholder influence often plays a significant role in prioritizing product tasks. According to the 2024 State of Product Management Report from Product Plan, 31% of prioritization decisions are influenced by stakeholders.

In The Product Experience Podcast, David Pereira advised product teams to avoid falling into this trap. He suggested that teams highlight the potential consequences of prioritizing stakeholder-driven tasks versus team-driven tasks and assess how each option impacts the bottom line.

Pro tip: To prioritize correctly, I recommend that product teams concentrate on their north star metric (NSM), the single outcome that delivers the most value to users. By focusing on the NSM, the team can identify tasks that need immediate attention while pushing less critical tasks forward.

4. Clarity

Imagine creating a product experience without understanding the users' needs or the intended outcome. This process is bound to fail, as conflicting priorities and disorganized efforts often lead to poor results.

When Arne Kittler appeared in The Product Experience Podcast, he highlighted time pressure, misconceptions, and personal discomfort as barriers to product clarity.

I agree with him because product managers, in a rush to meet deadlines, might skip essential steps to gain clarity. Product managers can also sometimes avoid pushing for clarity to maintain relationships with colleagues, which leads to poor product outcomes.

While clarity is critical, product teams shouldn't mistake it for certainty. Clarity means understanding the direction and purpose of the product experience process. Certainty assumes that every decision or outcome is guaranteed and unchangeable. Clarity is fixed, while certainty can shift according to the product strategy.

To gain clarity, the product team must foster a collaborative environment at the start of designing the product experience process.

While this is a mix of strategic and tactical planning, the key is to invest time upfront to get all stakeholders on the same page. Everyone needs to get involved through interactive exercises, such as discussing expected outcomes. This provides the clarity necessary for execution.

Designing Product Experiences That Count

When it comes to the direction of your product, everyone has an opinion. Sales might want one feature, customer success another, and the tech team could prefer a more complicated solution - each offering solid reasons for their choices.

However, having the right feedback and insights can outweigh the validity of their opinions, allowing you to focus on product tasks that your customers will love. Demonstrating the impact of your product experience on the company's success shouldn't be hard.

As a user of different products, I'd recommend you focus on an agreed-upon North Star metric - this will make it easy to demonstrate the effects of product investments.

Remember, you don't need every tool or resource to start creating good product experiences. Without customer feedback, you can use hypotheses, test them, and identify high-risk assumptions. If you lack a clear prioritization of tasks, use lightweight data prototypes to test options on a small user group to gauge their response and adjust accordingly.

Editor's note: This post was originally published in January 2024 and has been updated for comprehensiveness.

Topics: Customer Experience

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