Welcome to

Product School!
MODULE 4 - CREATE AN OPPORTUNITY HYPOTHESIS
Agenda

WEEK 1 WEEK 2 WEEK 3

Understand Customers & Problems

Course Introductions Competitiveness, primary & secondary activities, customer Validate an Opportunity Hypothesis
Instructor & trainee Intros journey maps Effort vs. user value, A/B testing & customer interviews

Introduction to Product Management Create an Opportunity Hypothesis

PM skills, goals & methodologies Qualitative & quantitative methods, setting goals Define Product Requirements
PRD, MVP & roadmaps

Set Product Objectives

User personas, metrics & use cases

WEEK 4 WEEK 5 WEEK 6

Start Building Develop Your Product II Get Hired

Design processes, product vs. design & sketching MVC, API design & team management Retrospectives, public speaking & resume reviewing

Develop Your Product I

Market Your Product Deliver and Present
Development methodologies, engineers & product, design
Channels, messaging & insights Capstone Project
patterns
 Agenda Accelerated

DAY 1 DAY 2 DAY 3 DAY 4 DAY 5

Strategy & Discovery Research & Define Design & Develop Launch Present

Create an Opportunity Hypothesis Start Building

Course Introductions Market your Product Deliver & Present
Qualitative & quantitative methods, Design processes, product vs. design
Instructor & trainee Intros Channels, messaging & insights Capstone Project
setting goals & sketching

Get Hired
Introduction to Product Validate an Opportunity Develop Your Product I Retrospectives, public speaking &
Management Hypothesis Development methodologies, resume reviewing
PM skills, goals & methodologies Effort vs. user value, A/B testing & engineers & product, design patterns
customer interviews

Develop Your Product II

Set Product Objectives Define Product Requirements MVC, API design & team
User personas, metrics & use cases PRD, MVP & roadmaps management

Understand Customers & Problems

Competitiveness, primary &
secondary activities, customer
journey maps
Index > Session

Agenda

1. Qualitative Methods

2. Quantitative Methods

3. Setting and Approaching Goals

4. Product Market Fit

Module 4 > Section 1 > Qualitative Methods

Qualitative Methods
Module 4 > Section 1 > Qualitative Methods

Intro: Bugs & Sugs

Sometimes you have known issues, bugs or

feature requests (sugs).

These can be semi-quantitative if many people Not every opportunity comes

ask for it or determine the impact on your from data...
product.
Module 4 > Section 1 > Qualitative Methods

Intro: Technical debt

1. Sometimes you reach a point where you have

to pay off tech debt

2. Frustrating b/c no visible user value

3. Useful to do this after a big release

a. You’re gathering data about how your

changes are received
Module 4 > Section 1 > Qualitative Methods
VISION

Roadmap steps
towards a vision

Your company might have a vision they’re

Context Users
working towards and a defined roadmap to get
there

Your next opportunity might just be “what’s

next on the roadmap” because your ultimate
goal is implementing the vision

User value once you’ve achieved the vision vs.

Metrics Imagination
making improvements to what you have right
now that customers can appreciate immediately

8
Module 4 > Section 1 > Qualitative Methods

Intuition + validation

As you gain experience and work with

customers, you might just clearly see
opportunities sometimes you can’t quantify.
The only real
Make sure to validate these because they’re valuable thing is
opinions, not facts!
intuition
Albert Einstein
Module 4 > Section 1 > Qualitative Methods

Teams

● Others on your team or on different

teams can have useful ideas.

● Other teams often have more contact

with customers, like support and sales.

● Listening to their ideas = soft

power/influence.

● Making them part of the ideation

process can help.
Module 4 > Section 1 > Qualitative Methods

R&D

● Sometimes your engineers just make

something new and cool.

● Can you find a way to productize the

invention that provides customer value?
Module 4 > Section 1 > Qualitative Methods

Competition

It’s worth knowing what the other guy is doing

and how the market reacts.

Sometimes you’ll want to copy their ideas.

● BUT… don’t only copy.

● You’ll never innovate

● Customers are better off using your

competitor’s product
Module 4 > Section 1 > Qualitative Methods

There are 2 great tools

by Alexander Osterwalder & Yves Pigneur

Created to help you strategically look at your

company and product.

1. Business Model Canvas

2. Value Proposition Canvas

Module 4 > Section 1 > Qualitative Methods

Business
model canvas

Business Model Canvas Template here

Module 4 > Section 1 > Qualitative Methods

Customer segments

1. Key personas the company/product will

serve

a. Most important personas that

you believe you’ll create the
most value for

2. Prioritize opportunities for them

a. The value proposition canvas

will dive more into this.
Module 4 > Section 1 > Qualitative Methods

Value propositions

1. What’s the benefit/value that a certain

group of your products or services
provide for a given persona?

2. What customer pain points are you

solving?
Module 4 > Section 1 > Qualitative Methods

Channels

● How does the company reach each

persona to deliver value, including
marketing, communication,
distribution, sales, and support?

● How are you reaching them now?

What works best? How are the
channels integrated; for example, are
sales only via your website?
Module 4 > Section 1 > Qualitative Methods

Customer relationships

What type of relationship, from personal to

automated, do you want to establish with each
persona?

Also consider:

1. What each segment expects

2. What you have now

3. How costly they are

4. How do you expect to maintain them

Module 4 > Section 1 > Qualitative Methods

Key resources

What are the most important physical,

financial, intellectual (patents, copyrights,
etc.), or human resources the company needs
to succeed?

1. It can be owned or leased.

2. For many companies making hardware,

human and intellectual resources are
key now whereas manufacturing is
outsourced to a partner.
Module 4 > Section 1 > Qualitative Methods

Key activities

● What are the tasks a company must do

well to deliver its value?
Module 4 > Section 1 > Qualitative Methods

Key partnerships

Who are the people outside the company, from

suppliers to contractors, who make the business
model work?

What key resources do we get from them and what

key activities do they perform?

Companies rarely do everything themselves, &

there are generally three types of partnerships:

● Alliances between non-competitors

● Strategic partnerships between competitors

● Joint ventures to build something new

Module 4 > Section 1 > Qualitative Methods

Cost structure

Where do your costs come from? There are 2

options:

1. Fixed costs (salaries, rents, utilities)

2. Variable costs (equipment purchases)

Module 4 > Section 1 > Qualitative Methods

Revenue streams

This represents the company’s incoming cash

(revenue - costs= company’s earnings).

A company might have multiple revenue streams

depending on its customer segments

To monetize each segment ask:

1. What value do you deliver that each will

pay for?
2. What do they currently pay?
3. How would they prefer to pay? (e.g., lower
recurring fee vs. higher one-time fee)
Module 4 > Section 1 > Qualitative Methods

Value proposition
canvas

Gain Creators
Gains

Products &
Jobs-To-Be-Done
Services

Pains
Pain Relievers

Value Proposition Canvas Template here

Module 4 > Section 1 > Qualitative Methods

Customer jobs

1. Things the customers are trying to get

done, in their own words.

2. The problem they’re trying to solve.

3. The need they want to satisfy

Customer jobs align nicely with product use cases.

Module 4 > Section 1 > Qualitative Methods

Gains

● Outcomes the customer wants to achieve,

in their own words.

● Gains aren’t just functional.

● They might be social like buying

something stylish to look cool.
Module 4 > Section 1 > Qualitative Methods

Pains

● Obstacles preventing the customer from

completing the jobs + possible bad
outcomes and risks.

● Make these concrete.

Module 4 > Section 1 > Qualitative Methods

Gain creators

● Refer to how your products and services

create benefits and outcomes the customer
wants.

● It’s required, desired, or surprising.

● Might also be functional, problem-solving,

or social (including cost savings).
Module 4 > Section 1 > Qualitative Methods

Pain relievers

● How your product addresses the

customer’s top pains.

● Don’t need to address every pain.

● Should be clear in the canvas how your

product addresses their key pains.
Module 4 > Section 1 > Qualitative Methods

Strategy tools Q&A

Can help you frame your thoughts.

● Trying to improve revenue?

● Need to understand your costs and

Use canvases to
revenue structure aid your thinking
● Trying to improve customer satisfaction?

● Need to understand their jobs, gains, gain

creators, and pain relievers
Module 4 > Section 1 > Qualitative Methods

Kano model
USER
SATISFACTION
DELIGHTE
R (WOW)
● A way to think about what features we’re
missing. PERFORMANCE
(MORE IS
BETTER)
● A way to start prioritizing what to do
next/where to spend time.
LESS INVESTMENT INVESTMEN
T
MUST
HAVE

USER
DISSATISFACTION
Module 4 > Section 1 > Qualitative Methods

Basic expectations
USER
SATISFACTION

1. Customers expect these

2. These are implicit

3. Spending time making these better doesn’t

significantly improve customer satisfaction
LESS INVESTMENT INVESTMEN
T
4. When building something new, these can MUST
be frustrating because you might HAVE

accidentally miss building one, they take

time to build, and they can prohibit
customer adoption

USER
DISSATISFACTION
Module 4 > Section 1 > Qualitative Methods

Satisfiers
USER
SATISFACTION

1. Things customers ask for/request

improvements to PERFORMANCE
(MORE IS
BETTER)
2. Usually direct correlation between the time
you spend on them and how happy
customers are LESS INVESTMENT INVESTMEN
T
3. Where a lot of your time goes

USER
DISSATISFACTION
Module 4 > Section 1 > Qualitative Methods

Delighters
USER
SATISFACTION
DELIGHTE
R (WOW)
1. Innovative “wow” features

2. Provide significant satisfaction often with

a lower investment, customers don’t expect
these
LESS INVESTMENT
Example: 1st time you used a Snapchat filter INVESTMEN
T
Over time, features move down in category

3. Delighters become satisfiers

4. Satisfiers become basic
5. Incentive to keep finding delighters
6. Need to be aware of when a satisfier has
become a basic feature not worth iterating USER
DISSATISFACTION
on
Module 4 > Section 1 > Qualitative Methods

Opportunity

What you’ve learned is…

1. Start with a company goal

2. Translate it into a specific product goal

3. Come up with an informed idea/approach

to achieve that goal
Module 4 > Section 1 > Qualitative Methods

Key takeaways

1. Understanding what is going on with your

users by using qualitative sources together
with your quantitative data.

2. Thinking how to solve these for your users.

3. Creating a mental model and build a

roadmap to continue delighting your users.
Deepen your
understanding of using
User Research to inform
your Roadmap and make
better decisions on the
Product Leader
Certification (PLC) ™

Live Module 10: Advanced Product

Analytics and Experimentation
Index > Session

Agenda

1. Qualitative Methods

2. Quantitative Methods

3. Setting and Approaching Goals

4. Product Market Fit

Module 4 > Section 2 > Quantitative Methods

Quantitative Methods
Module 4 > Section 2 > Quantitative Methods

Metrics are key!

● Primary way to find data-driven

opportunities.

● People are bad at self-reporting.

Metrics are objective
Module 4 > Section 2 > Quantitative Methods

Analytics

Look at all of your metrics

collectively to analyze customer
behavior.
Module 4 > Section 2 > Quantitative Methods

Metrics tell us what not why!

Finding an opportunity with “interesting” metrics.

EXAMPLE: Key metric whose value we want to change.

Data just tells us what’s happening, not why it’s occurring.

We’ll need to figure out why the metric is what it is later on.
Module 4 > Section 2 > Quantitative Methods

Make sure to sanity check your data!

● Ensure you’re tracking the right metrics.

● Ensure the labels are consistent.

● Ensure they’re being reported correctly across

all platforms/use cases.

● Make sure your tool is working as expected.

EXAMPLE: Google Analytics only samples a subset

of data, and this can cause a misrepresentation of user
behavior in high-traffic products.
Module 4 > Section 2 > Quantitative Methods

Segmentation

Easy to understand.

You’ve got lots of metrics.

When you group your customers into bins,

how does each bin compare for various
metrics, and how do those numbers compare to
your expectations.
Module 4 > Section 2 > Quantitative Methods

Cohort analysis

Cohort analysis is similar to segmentation, but

we factor time into it.

● How is your customer’s engagement

affected over time?

● How does customer behavior vary for

customers that sign up for your product
this week vs the ones who signed up a
month ago?
Module 4 > Section 2 > Quantitative Methods

Loops

Feedback loops are used in the iterative process

in a product’s lifecycle to:

● Set clear metrics

● Measure and gather data

● Analyze and learn

● Refine and iterate

Module 4 > Section 2 > Quantitative Methods

AARRR! - Clearly defined goals

Acquisition Activation Retention Referral Revenue

Goal 1st visit, ideally a “happy” Goal
User comes back to the site User tells friends User likes it
User comes
What toWant?
Do You the site What Do You Want?
experience (shows engagement) about it enough to pay
Module 4 > Section 2 > Quantitative Methods

Turning metrics into opportunities

Great, we’ve looked at our

data & maybe we’ve flagged
some potentially interesting
data points.

How do we turn this into an

opportunity?
Module 4 > Section 2 > Quantitative Methods

Metrics & asking WHY

If you flagged an interesting metric that you think improving

would help you hit your goal, start asking why.

Ask why until you get to something actionable.

Module 4 > Section 2 > Quantitative Methods

Intercom’s feature edit

The goal is to look at data to visualize adoption of key

feature areas

● Need to clearly define “adoption”

● Exclude administrative features

Graph how many people use it on the X-axis, how

frequently they use it on the Y-axis

TOP RIGHT = Core of product (things many people

use all the time)

TOP LEFT (a few people use it a lot) = niche feature

(such as for one specific customer) OR a poorly adapted
feature (which indicates an opportunity)
Module 4 > Section 2 > Quantitative Methods

Feature vs % of users who use it

Plot key features vs. percentage of customers

who use it

Lets you identify poorly-adapted features or

unexpectedly common ones.

If there’s only one commonly-used feature,

you’re easily replaceable by a competitor,
which is a bad place to be.
Module 4 > Section 2 > Quantitative Methods

Decisions

Generally, you’ll end up wanting to do 1 of these 3

things:

● Improve a feature to improve a key metric

● Get more people using a feature

● Get people to use a feature more often

Module 4 > Section 2 > Quantitative Methods

Adoption

Main Goal: Understand why they’re not using it

1. Getting more people using a feature requires

understanding the customers

2. Need to understand why people aren’t using it

3. Are people aware of the feature?

4. Do they understand the value?

Module 4 > Section 2 > Quantitative Methods

Interviews & surveys

Valuable to understand
what’s going on in a
customer’s brain.
Module 4 > Section 2 > Quantitative Methods

Measuring importance vs. satisfaction

framework

● Works well for adoption challenges.

● Survey customers for satisfaction level.

● Internally weigh each feature’s importance.

SATISFACTION
● Graph the results. Ideally, you want people to
be very happy with very important features

● Satisfaction matters less as the feature’s FEATURE X

importance drops

IMPORTANCE
Module 4 > Section 2 > Quantitative Methods

HOOK Canvas

Trigger Action Reward Investment

Reason to use the product You do something in You get the value from the What do you do to plant the
anticipation of the reward (e.g. action (see the # of seed for more triggers?
What internal trigger does the Go to LinkedIn to see an endorsements for skill growth, (endorse others, add new skills
product address? endorsement) feel that you’re being to your profile)
What external thing happened recognized professionally for
to get you to use the product to your skills)
get that value (e.g. LinkedIn
email about an endorsement)
Module 4 > Section 2 > Quantitative Methods

HOOK Canvas

1. What internal trigger is the

product addressing?
4. Is the reward fulfilling, yet
2. What external trigger gets the
leaves the user wanting more?
user to the product?

5. What "bit of work” is done to

increase the likelihood of 3. What is the simplest behavior
returning in anticipation of reward
Module 4 > Section 2 > Quantitative Methods

Looking at data

Segmentation Cohort Analysis Loops

Grouping by a common trait Adding time to segmentation Measuring, learning, and

refining the product
Module 4 > Section 2 > Quantitative Methods

Key takeaways

1. Use these tools the best way you want to.

2. Critical to think about how you use data.

3. How you serve your customers better.

Module 4 > Section 2 > Quantitative Methods

Time for a break

Stretch, breathe,
grab a drink

Estimated time: 5 minutes

Index > Session

Agenda

1. Qualitative Methods

2. Quantitative Methods

3. Setting and Approaching Goals

4. Product Market Fit

Module 4 > Section 3 > Setting & Approaching Goals

Setting and
Approaching Goals
Module 4 > Section 3 > Setting & Approaching Goals

Why is it important?

Goals help drive the team in a specific

direction. Brings clarity and accountability and
helps in showing progress.

Example: Working on the growth team for

Netflix.
Module 4 > Section 3 > Setting & Approaching Goals

Opportunity

PMs have opinions but, how do you know if

your customers will want it?

Use the scientific method.

Module 4 > Section 3 > Setting & Approaching Goals

How do you identify an opportunity?

1. Data analysis: Look at internal product

usage/trends

2. Customer Interviews: Hear an idea there and

that sparks things

3. Biz dev Teams/Sales: Can also come up with

an opportunity you can’t pass up > that defines
what you do next (pre-validated)

We’re teaching you one way to approach things, but a

lot of this is a circular/chicken-egg situation. You’ll
need to adapt to your specific situation.
Module 4 > Section 3 > Setting & Approaching Goals

Opportunity:
Connect with the company’s
mission/products mission
● What are the constraints we’re going to give
ourselves?

● Companies move their goals between growth,

engagement, or revenue.

● Every life cycle begins by saying “what are

we trying to do.”

● Important to establish a clear goal early on to

help guide and focus your decisions and to
let you pick (and measure) success metrics.
Module 4 > Section 3 > Setting & Approaching Goals

Some pointers while setting goals -

Iteration

Can be BIG. It doesn’t just

mean tiny tweaks.
Matters. It might be
fundamental
rewrites/overhauls of an app.
Module 4 > Section 3 > Setting & Approaching Goals

Some pointers while setting goals -

Blue Sky Opportunities

This is something totally new.

Address new possible global maxima

—maybe there’s a broader change.

Or maybe you want to expand into a new

market and need to build a new product to
address it.
Module 4 > Section 3 > Setting & Approaching Goals

Blue Sky Opportunities

Emerge by reframing what you’re doing.

EXAMPLE: Netflix and Blockbuster let you watch

movies at home.

1. Blockbuster = video store

2. Netflix = content delivery, no matter where
that content came from.
That made it natural for Netflix to move from mailing
DVDs to streaming content.

Blockbuster was slow to react and missed a big shift.

Module 4 > Section 3 > Setting & Approaching Goals

Measurable goals

Metric Launch Countdown Understand

Clear metric goal MAU, Brand new products, used as When you want to solve user When you need more insights
Revenue. Good for growth the first milestone. problems but are unsure but don’t have it, instead of
products or PMF product. about the metric impact but focusing on building take a
know from user research break and focus on
about the core user problem. understanding.
Module 4 > Section 3 > Setting & Approaching Goals

Key takeaways

1. Set a clear goal which ties back to the

company/product/org’s topline or
mission.

2. Communicate frequently to show

progress.

3. Have 1 goal for each instead of 5.

Index > Session

Agenda

1. Qualitative Methods

2. Quantitative Methods

3. Setting and Approaching Goals

4. Product Market Fit

Module 4 > Section 4 > Product Market Fit

Product Market Fit

Module 4 > Section 4 > Product Market Fit Unmute and Share Estimated time: 10 minutes

Instructor-Led Q&A:
Market Fit

1. Why is Product Market Fit (PMF) so

important?

2. How to build product features/roadmap

toward PMF?
Module 4 > Section 4 > Product Market Fit

Why is PMF so important?

Example: Music App

Healthy sustainable growth versus NEW USERS + 40% MoM

unhealthy growth.

Unhealthy growth means we should

stop growth work. WoW RETENTION 10%

ABANDON SEARCH 50%

Module 4 > Section 4 > Product Market Fit

Why is PMF so important? Example: Example:

Music App Scenario 1 Music App Scenario 2

With milestones, set the right expectations. LAUNCH LAUNCH

Set a clear frame of reference based on the

product milestones versus talking about big
numbers right after launch. PMF

GROWTH GROWTH

EXPANSION EXPANSION
Module 4 > Section 4 > Product Market Fit

Focus on strategy,
THEN execution
Module 4 > Section 4 > Product Market Fit

4 step PMF framework

Define core product value

Strategy Quantify core value

Create thresholds

Roadmap/
Execution Features to hit
thresholds

Hit Goals = Attain PMF

Module 4 > Section 4 > Product Market Fit

4 step PMF framework

Help users discover music Define core product value

Strategy
If users returning WoW then we are creating value for them
Quantify core value
(WoW retention)

40% WoW (market benchmark or internal golden cohort

data) retention is a good measure (we are at 10% today) Create thresholds

Execution
Roadmap/
Roadmap - New discovery tab, new artist notification, more
Features to hit
songs, new artists etc. thresholds

Hit Goals = Attain PMF

Module 4 > Section 4 > Product Market Fit

You start growing once you

hit PMF.
That’s healthy and
sustainable growth.
Module 4 > Section 4 > Product Market Fit Unmute and share Estimated time: 110 minutes

Breakout Group Discussion:

Business Model Canvas

Steps: Desired Outcomes:

1. Choose a product 1. Understand how to establish and align business

2. Fill out the business model canvas priorities using the Business Model Canvas.
2. Gain proficiency in formulating hypothesis
3. Use insights to create a hypothesis statement statements based on your findings from the
canvas.
4. Attach a success metric to your hypothesis
3. Learn how to tie a success metric to your
hypothesis statement.

Business Model Canvas Template here & Hypothesis Statement Template here.
Module 4 > Section 4 > Product Market Fit

Things to note

Product-market fit will evolve as you change

the scope of your product

You’ll always be improving your product,

tweaking your messaging, expanding to
another customer segment and so on (e.g.
Widen your target segment)

You have to go back and reevaluate your

framework
Module 4 > Section 4 > Product Market Fit

Key takeaways

1. PMF is critical for sustainable growth

& a strong foundation.

2. Hit PMF then focus on growth.

3. Use the 4 Step PMF Framework.

Q&A