Measuring and Boosting Product Engagement - the PES framework

TL;DR

• PES is a data-based measurement that reveals how users engage with your product.
• A high PES can help identify conversion opportunities, reduce churn, and improve the product experience.
• To calculate PES, you need to track adoption, stickiness, and growth rates. Then, combine them and divide the result by three.
• To improve PES, focus on improving adoption, stickiness, and growth rates altogether and enhance each element.
• Keep in mind that a good product engagement rate falls between 70 to 80.

Looking how to keep your users' attention on the product to the maximum? Measuring product engagement can help you find ways to do it well.

That's why I would like to introduce you the PES framework—short for Product Engagement Score. This approach not only measures user engagement but also provides actionable insights to boost it.

Let's get started 👇🏼

What is PES (Product Engagement Score)?

PES shows how users engage with your product.

Let's elaborate a little: PES is a way to keep track of in-app user engagement. It allows you to see how your user base interacts with your product or service.

The PES overview chart has three legs: adoption, stickiness, and growth. After combining the data you get from these categories, you get to measure product engagement.

Don't let the name fool you, though. Unlike NPS (Net Promoter Score), product engagement is rather an objective measurement of user behavior.

Thanks to PES, product engagement managers can see

• the number of users who spend time with your product and
• exactly where they spend it—providing valuable insights into consumer behavior, preferences, and satisfaction levels.

Product engagement scores can also be employed for keeping an eye on the success of product updates or new feature releases.

By comparing engagement scores before and after a product change, you can assess the impact of these efforts and make data-driven decisions for future improvements.

In short, PES can give you indications of how your product is performing based on the data that active users provide.

What are the benefits of having a high product engagement score?

Now that you know what product engagement score is for, let's move on to the benefits that come with having a high PES.

1. Identify opportunity for the users who are likely to convert

If you measure your product engagement score regularly, you'll enable teams to see from the point of view that your users have—how they interact with your product, combining user activity and user engagement together.

With a high engagement score, you'll be able to focus on the users who are actively making use of the product, basically, those who are more likely to convert.

This can be an opportunity for expansion, such as upselling and cross-selling. Here, you can also take the initiative by promoting specific add-ons and free trials on premium features.

2. Pinpoint the possible product-qualified leads

A high engagement score can shorten the amount of time spent finding PQLs; PES helps you find product-qualified leads by monitoring which users have been benefiting from the product in a way that leads to an upgrade.

3. Reduce churn

A high PES displays a map of highly active and inactive users. You can skip the part where you focus on finding the inactive users and start discovering the problem area.

4. Improve the product experience.

Throughout the steps of PES, you'll notice the pros and cons of your core product. By attending to each area that needs improvement, you'll create a better SaaS product over time.

In other words, a high PES will guide you to what you lack and help you form an effective strategy that will enable high retention and a better customer experience.

Product Engagement Metrics

Knowing what PES is capable of, it's high time to discover the metrics we need to know to calculate it.

  Product Engagement Metrics

‎To discover the product engagement score, you'll need three other essential metrics: adoption rate, stickiness rate, and growth rate.

Keep in mind that your PES can vary according to user base.

A user who just went through the onboarding experience and a happy customer who actively makes use of your product are at two different points of their user journey. That's why you should segment users and measure PES accordingly.

1) Adoption Rate

The first of these three key metrics is related to product adoption, which shows how many of your product features your active users are using.

In other terms, it reveals how successful the features you've launched so far are, all based on product usage.

To measure the adoption rate, you'll need to find the number of new users.

Then, you need to divide that number by the total number of users and multiply the result by 100.

Do you prefer a formula? Here is how to calculate product adoption rate:

  How to calculate product adoption

‎2) Stickiness Rate

The second metric you'll need to track is product stickiness.

Stickiness puts forward the rate your users come back to your product on a regular basis, which reveals if your users perceive value in using your product.

There are two ways you can measure this metric: weekly and monthly.

For the former, you'll need to divide the number of daily active users (DAUs) by the number of weekly active users (WAUs).

The latter requires you to divide the number of weekly active users by the number of monthly active users (MAUs).

Here, I should remind you that the weekly-to-monthly ratio gives a more accurate view of engagement level, while the daily-to-weekly ratio is a better choice for everyday products.

3) Growth Rate

The last metric of the day is the growth rate, which indicates how fast a business grows.

To calculate it, you need to sum up the revenue you get from the number of new users with the revenue you earn from the recovered users—visitors can work as well if your application is free.

Then, you need to do the same for the churned customers and visitors in order to find your lost revenue.

Now, all there is left to do is divide these two numbers to find your growth.

How to Calculate Engagement Rate

  How to calculate engagement rate

Add adoption, stickiness, and growth rate together and divide the total amount by three; that is your product engagement score!

9 Tips for Improving the Product Engagement Score

Well, surely the answer to this question goes through improving all three legs of the PES:

• Adoption rate,
• Stickiness rate,
• Growth rate.

Improving the Adoption Rate

Onboarding does wonders when it comes to increasing the adoption rate.

This product metric is all about the value customer finds in your product, just like I mentioned above.

Thus, you have to make sure that customers understand your value proposition and meet their needs within the product to increase adoption.

To do so, you can try these effective strategies:

1. Create a Top-Notch Onboarding Experience for Your Users

👉 The initial onboarding flow always supports product adoption since it's the first time users get to explore the features you offer and understand the real value your product offers.

So, you should regularly get feedback on your user onboarding to update it from time to time with key feature improvements and new features.

  Get feedback from your users with UserGuiding's in-app surveys

‎Also, let me remind you that an onboarding process that users interact with allows them to have a better experience—so you should invest in an interactive walkthrough for users to turn into power users in no time.

Here are the three actionable tips for you to do so:

• create a frictionless one-click sign-up button,
• add onboarding checklists and tooltips to your onboarding process,
• provide extra help and support via resource centers with videos and articles at all times.

2. Elevate User Experience

👉 To drive adoption, you'll need to engage your user base better than ever, which you can easily accomplish by improving user experience.

It might sound odd, but doing this requires you to get to know your users. You can segment customers, look into their activities, and group their tendencies.

Ultimately, this will help you align your product with user needs, increasing adoption single-handedly.

Here are three tips for you to enhance your user experience:

• conduct user research and usability testing to understand user behavior,
• optimize your platform's performance and accessibility regularly,
• leverage user feedback analytics to stay aligned with user's needs.

3. Promote your (New) Features and Updates Effectively

👉 Don't forget to announce new features effectively because it's directly related to increasing feature adoption, affecting the overall product success.

You can also find the features that users aren't a fan of through analytics and understand why they haven't been utilizing these certain features.

To re-engage users via (new) features, you can:

• introduce these features in-product using announcement modals or changelog page,
• send short surveys to users to understand the reasons why they're not actively benefiting from these features,
• publish posts regarding these features through social media channels, such as your blog, LinkedIn, and email.

Improving the Stickiness Rate

Duolingo benefits from game-like elements to make users come back to it daily.

Moving onto the product stickiness, let me summarize what it is and why it's important: Stickiness refers to the pull your product has when it comes to users.

It plays a great role in user engagement as it's about your product's daily active users who come back to your product on a regular basis.

4. Benefit from Gamification

👉 To improve stickiness, you need to play your cards right.

And just having mentioned cards... games are a great means for you to accomplish this specific goal.

Adding game-like elements to your product will help users engage better with your product and motivate them more when it comes to using your services.

A gamification strategy can be implemented by:

• allowing users to create avatars for themselves,
• adding points, progress bars, badges, and levels to your product,
• preparing checklists for user-related processes, such as onboarding and feature discovery.

5. Enhance User Engagement

👉 User engagement and product stickiness go hand in hand; none can deny that.

That's why you should focus on retaining your users by making use of targeted and personalized notifications to remind them to return to your product.

These messages should be relevant, timely, and provide value, such as reminding users of incomplete tasks, new features, or content based on their interests.

Here are three ways you can boost user engagement:

• send notifications, such as emails and push notifications,
• make use of A/B testing to see which engagement method best fits your audience,
• prepare micro surveys to segment customers and offer personalized content.

6. Invest in Community Building

👉 Community building is actually a thing... thing that only a few know of its importance.

Psychologically, users are more likely to stick with a product if they feel a part of a community because of the unity it forms.

You can encourage interactions among users through forums, user groups, or social features within your product.

Like I said, a strong sense of community can lead to increased user engagement, loyalty, and product advocacy altogether.

To create one, you can make use of these three steps below:

• find users who are fans whom you can bring together as the early adopters who will most likely become the core of your community,
• engage with them through social media, email, and within your product to understand their needs, preferences, and feedback,
• encourage them to share their stories, experiences, and use cases—you might even offer some incentives to motivate them.

Improving the Growth Rate

You can implement partnership and collaboration strategies to boost growth rate just like UserGuiding and many popular tools do.

Growth is a rate that combines the efforts of marketing, sales, customer success, and product teams, which gives you an overview of how well your product is growing.

You can compare your ratio to other successful SaaS businesses in order to see how you're doing compared to the marketplace and analyze the ups and downs regularly.

7. Focus on Product-Market Fit

👉 You should be aware of the fact that starting as a good product won't get you to climb the ladder of the top three like that.

It might be a good starter, but it won't mean a thing if you don't refine your product.

Keepin' your eyes on your product to ensure that it meets your target market's needs and solves their problems effectively is a must these days.

So, let me provide you with three actionable tips for enhancing your product-market fit:

• act on user feedback to adjust the user experience based on the data your target audience provides,
• refine your value proposition with every important update to give the right message,
• test a new feature that you bring with a specific part of your customers to see if they'll engage with it, and then make it live for everyone.

8. Start a Referral Program

👉  To boost growth, you can also try out a new strategy, referral programs.

By encouraging your existing users to refer new users, you can create a well-structured referral program, ultimately boosting your user base by leveraging the networks of your current users.

Also, keep in mind that you should offer incentives for both the referrer and the referred.

Now, to make this happen, you should:

• simplify the referral process to maximize participation,
• design a compelling offer to attract users,
• promote the program through each marketing channel.

9. Expand Your Reach with Partnerships and Collaborations

👉 Sometimes, your business needs an external touch—which is the case for partnerships and collaborations.

You can form strategic partnerships with other businesses that can introduce your product to new audiences.

You should look for partners where your product adds value to their offering and vice versa, creating a win-win scenario for both parties and their customers.

To find partnership and collaboration opportunities and bring them to life, you should:

• identify potential partners,
• reach out and build relationships by attending events and engaging with potential partners via social media,
• sign up for partner collaboration tools to search for and communicate with partners.

In Short...

The product engagement score is a metric worth tracking for product managers as it displays the overview of in-app user interaction with your product.

It might even be classified as a product engagement essential for every SaaS business out there, with many competitors in the marketplace.

Keeping track of this product engagement metric comes with its benefits, such as improving the overall product experience, uncovering PQLs, and recognizing revenue opportunities.

In order to measure engagement for your product, you should also track three of the most important metrics, including adoption, stickiness, and growth rate.

Combining these three metrics and dividing the result into three will provide you with your PES.

This is all you have to do to calculate your PES, but if you're interested in improving it... then you can check the tips I prepared to enhance the PES triangle right above 😌