There’s a lot of talk of metrics and KPIs in the world of SaaS, but how do you know which ones to focus on to build sustainable growth for your company?
At the SaaS Metrics Summit, we were lucky enough to be able to sit down with three leaders from the world of SaaS, who shared with us their insights on the metrics that matter most as you scale your organization.
You can catch the full, unedited talk right here on demand. But for now, we've put together some of the best bits for you. 👇
- Christian MacLean, Global Head of Product at Auctane,
- Mike Pilawski, Chief Product Officer at Smallpdf.
- Valentina Thörner, Empress of Remote and Support Quality at Klaus.
Dig in and learn which metrics you should be paying attention to as you take your company to the next level.
Key talking points:
- Meet the speakers
- The role of empathy in uncovering metrics that matter
- Finding alignment on the metrics that matter
Meet the speakers
Valentina Thörner: I'm Valentina Thörner. I’m based near Barcelona but I’m originally from Germany. Currently, I'm Empress of Remote and Support Quality at Klaus.
Klaus is a customer service quality management platform and, as you can imagine, it’s very very customer-focused. I helped grow the company from 10 to over 60 people, entirely remotely.
One of my favorite topics is how to make sure that customer support and product can align on their metrics because, having a background in both, I'm trying to always skip back and forth.
Mike Pilawski: I'm the Chief Product Officer at Smallpdf, a document creation management platform used by roughly 70 million users every month. Obviously, metrics are very close to our hearts.
In Barcelona, I was a COO of a company called Typeform. And prior to that, I had similar roles running product data and engineering in different start-ups in Silicon Valley.
I dealt mostly with mobile advertising, AB testing, and marketing automation in data-driven products.
Christian MacLean: I’m Christian Maclean, Global Head of Product at Auctane, primarily looking after our ShipStation product. We’re a multi-brand solution in shipping, e-commerce, and logistics.
When I joined two and a half years ago we were about 198 people. We are now 2100 people and a global company; we've gone through some pretty explosive growth so I have lots to share about what scaling up looks like. It's certainly been an exciting ride.
empathy and uncovering metrics that matter
Valentina: Empathy is interesting because it's very difficult to measure. You recognize it when you see it, but how do you define it? How do you measure it? Technically, it's the ability to understand another person's situation and feelings.
In a work environment, empathy means making the other person feel heard. It doesn't mean that you will always do what they want you to do, but that you give them the feeling that you have taken their point of view into account.
That’s important not only with your customers but also within the team because in the end, empathy is something that spreads through the entire organization.
The thing is, we can’t teach empathy. We can teach behavior that looks like empathy. And for our customers, it’s kind of the same thing. If you feel like you're being heard, it doesn't really matter whether you have been heard, as long as the outcome is good.
You need to structure the processes within your company in a way that enhances empathetic behavior. That means product managers need to be able to talk to customers and create this connection.
The company as a whole needs to have an opportunity to talk with not just the product people but also the customers. Everybody should know what the product is for, and everybody needs to understand the bigger picture because if you don't, you can’t be empathetic.
Obviously, the bigger your company is, the more you need processes to build in empathy. You can’t trust that people will just figure it out, as much as they might love to.
You might have people in your company who are just not empathetic, but if you give them the right tools and the right processes, they can still act empathetic.
Whether they then want to really get deep into empathy is a question for psychologists and not for product managers.
Christian: In some ways, we're all amateur psychologists in this job, at least in terms of honing our ability to listen and uncover problems.
Mike, what are your thoughts on that? Do you share that same point of view, or do you have a different one? How do you feel about the role of empathy in uncovering metrics that really matter in our customer problems?
Mike: I think there are two separate problems. One problem is, how do you create more empathy among, say, product managers, engineers, and product designers, so they can build products that match the customers’ emotional states?
And then the second question is, how do you even match customers’ emotional states in the first place?
For the first problem, Valentina gave a great answer. I would just add that the more face time we have with the customer, the more empathy there will naturally be.
PMs should talk to customers, ideally at least once a week. Preferably you should expose engineers, designers, and everyone else to customers too. For example, at Typeform we had an initiative where we brought in customer panels every Friday and we demoed different things to them.
We would broadcast these demos to everyone at the company, who could then get real-time feedback from the customers.
In the past, we’ve sent engineers to spend a week with customers observing how they behave. I must say, some of the best insights and the best features came from that direct interaction.
It's very motivating for people when they have the experience of solving real problems for real humans, versus solving problems shown by the data. On a personal level, it's much more rewarding.
But there is a second question: how can you make a product more empathetic? And it's a question I haven't dealt with in a while, but I did spend some time with it in mobile advertising. In advertising, you're looking for certain emotional states. You especially look for a space where emotions are high.
To give you an example, if someone is angry, that’s a good state for advertising. Disappointed or depressed, not so much.
You're looking for people who are oriented towards action, and people take action when they’re in high arousal states. When someone’s disappointed, they just walk away. When they’re angry, you can advertise a competitive product and they’ll download it and use it.
As you do usability tests with your customers and you look at how they are experiencing the product, it's also very important to see where those emotional moments happen.
One of the best metrics we use is customer effort score. After the customer takes action, we ask them whether it was more or less difficult than they expected; that way we get a sense of their emotional state.
We see it too when customers try an action and fail. We look at the completion rate for actions, and we know that whenever they fail, there is a negative reaction. So if you can figure out those moments in your product, you can build it to communicate better with the customer.
If you have a bug everyone’s disappointed, right? Acknowledge that in the product and say, “Yes, we have a bug, we are sorry, and we'll fix it.” People feel much better when you do that. They feel understood.
They feel like you're communicating with them. If you're hiding that bug, then they get angry because they feel that they are not heard. It's important to respond to those emotions when you find them in your product and build a bridge with your customers.
Christian: You raised some great points there. It's interesting because in my field, e-commerce, people never used to think of what happens during the shipping and delivery of an order as part of the customer experience, when in fact it is.
If you're not getting visibility into when your order’s coming, and it's a pair of shoes for a wedding, that can be super stressful for a shopper, and there are countless scenarios like this.
Finding alignment on the metrics that matter
Christian: I personally am a very big and vocal fan of Fred Rogers; for those of you that don't know, that’s Mr. Rogers from the kids’ show.
He's credited with saying “Anything that's human is mentionable, and anything that's mentionable can be more manageable.” Essentially he means that when we talk about our feelings, they become less overwhelming and less scary.
I've taken that to heart from a product person perspective. And I always say anything that's measurable is manageable as a product manager.
So when we talk about the metrics that matter to different parts of our business, we're better able to align our goals and the outcomes we’re trying to deliver for our merchants.
How important do you think it is to build common ground with the broader trends when you're thinking about metrics that matter? And how have you approached this common ground in the past?
Mike: For us, we try to build a metrics tree that goes from the top of the company to the bottom. We start with a North Star metric. You have to have that one metric, and it can be really helpful.
What can happen though, when you focus on just one metric, is that you end up missing key parts of your business. So you need to decide carefully what that metric is going to be, and ideally, it should be one that unifies value creation with value capture.
Smallpdf’s users process documents, so our North Star metric is the number of documents processed by our customers. We want to grow that metric because it shows that we’re creating value and the customers get that value and will keep coming back.
From the North Star metric, we build four levels of metrics down to the point where it lands with the individual teams. Then they have something that they can actually change, and not just change every six months but every two sprints.
They can see measurable progress and understand how that metric builds all the way up to the top metric that the entire company follows.
So you can build metrics top-down. I would also say that I was lucky in my last two roles: they were both in product-led companies, where it's much easier from the product position to bring in those metrics. Previously, I was in businesses that did enterprise sales, and it was a little bit harder.
Christian: Valentina, what do you think about that from a customer support perspective?
Valentina: The idea that there is one metric that trickles down into the different parts of the organization is super important because you want everybody to row in the same direction; otherwise, you're going in circles.
However, exactly how the metrics look will be different from team to team because of course, the customer support team will have very different metrics to the product team. And the thing is, they work at different velocities.
Customer support might have a customer waiting on the other side of a chat window, so when they’re looking for an answer, it can’t come soon enough.
Meanwhile, product teams tend to work in two-week cycles or six-week cycles so “I'm going to get this to you ASAP” for a product person might mean three months from now, while for the customer support person ASAP might mean yesterday.
By understanding which metrics are measured where and why, you can actually reduce friction within the organization. And the less friction you have between departments, the more information can flow between departments.
For the product team, it's super important to get the information that comes in through customer-facing teams like sales, customer success, and customer support.
The metrics need to tell a story too because that’s how we think. The example you gave of the shoes before the wedding – that's a story that shows me why the shipping notification is crucial.
It resonates way more than if you tell me that 27.6% of our most frustrated customers complained that they didn’t get an email. The bride was waiting for her shoes! That conjures up a whole story that's very relatable for everyone because we've all seen Bridezilla.
Ultimately, the question is how can we put metrics together with stories and make sure that everybody understands? Because in the end, it's customer stories that make the product grow.