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Lean Product Management for 
Web 2.0 Products
Dan Olsen, CEO, YourVersion
O’Reilly Web 2.0 Expo SF
May 6, 2010
Lean Product Management
Lean: iterating and improving quickly in a 
resource‐efficient manner
Product Management: role res...
What’s So Great about “Lean”?
What’s wrong with    Startups are at risk until 
being not‐so‐lean?   they’re profitable
My Background
  BS, Electrical Engineering, Northwestern
  MS, Industrial Engineering, Virginia Tech
  MBA, Stan...
What’s the Formula
       for Product‐Market Fit?
A product that:
  Meets customers’ needs
  Is better than other alternat...
Understanding Customer Needs

                    Copyright © 2010 YourVersion
Problem Space vs. Solution Space
 Problem Space                  Solution Space
   A customer problem,            A specif...
Problem Space vs. Solution Space
         Product Level
Problem Space       Solution Space
 (user benefit)       (product)...
Problem Space vs. Solution Space
           Feature Level
Problem Space              Solution Space
 (user benefit)       ...
How Do You Prioritize User Benefits 
     and Product Features?
Need a framework for prioritization
  Which user benefits ...
High Importance + Low Satisfaction =
Importance of User Need
Importance vs. Satisfaction
       Ask Users to Rate for Each Feature
              100                                   ...
Kano Model: User Needs & Satisfaction
              User Satisfaction
                                  Delighter (wow)

Olsen’s Hierarchy of Web User Needs
       (adapted from Maslow)
    Customer’s Perspective                               ...
What is Your Value Proposition?
 Which user benefits are you providing?
 How are you better than competitors?
Prioritization and Scope
Customer value is only half the equation
How much engineering effort will it take?
Need to consid...
Prioritizing Product Ideas by ROI

Return (Value Created)

UI Design and Ease of Use

                    Copyright © 2010 YourVersion
User Benefits vs. Ease of Use
Q: If two products equally deliver the exact 
same user benefits, which product is better?
The UI Design Iceberg
  What most
  people see
  and react to                       Visual
Elements of User Interface Design
Consists of Three Distinct Elements:
  Information Architecture
     Structure and layou...
Learning from Customer Feedback

                      Copyright © 2010 YourVersion
Iterating Your Product Vector Based on 
    User Feedback in Solution Space
      Problem Space                   Solution...
Persevere or Pivot?

Product-Market                        Product-Market Fit =
      Fit                    ...
What Are You Getting Feedback & 
       Learnings About?
 Problem Space            Solution Space
(your mental model)   (w...
What Can Solution Space Objects
  Can You Test with Customers?
Range of solution space options:
  Wireframe: low‐fidelity ...
The Value of User Feedback Sessions
Critical to talk with customers 1‐on‐1
Gain better understanding of
  Customer needs a...
“Ramen” User Feedback for Startups
Anyone can do it!
  Solution‐space product/mockup to test
  1 customer (wi...
Typical Format for Customer Session
5 ‐ 10 min: Ask questions to understand user 
needs and solutions they currently use
Dos & Don’ts of Conducting Usability
  Explain to the user:
     Their usability test will help improve the product
Case Study on Product‐Market Fit:

                        Copyright © 2010 YourVersion
Product‐Market Fit Case Study:
My consulting client, CEO of TrustedID, 
had an idea for a new pr...
Product‐Market Fit Case Study:
    Developing Product Concept
Product Concept was “marketing report” that let 
consumers c...
Copyright © 2010 YourVersion
Copyright © 2010 YourVersion
Clustering Potential User Benefits to 
        Create Product Concepts
“Shield” Concept                 “Saver” Concept

Product‐Market Fit Case Study: 
        Recruiting People
Telephone recruit of prospective customers
  Wrote phone‐screen ...
Product‐Market Fit Case Study:
  Findings on Concepts &User Benefits
“Shield” Concept                 “Saver” Concept

Product‐Market Fit Case Study:
      Learnings from Research
Learned that “Shield” (anti‐junk mail) concept was 
stronger ...
Copyright © 2010 YourVersion
Product‐Market Fit Case Study:
4 weeks from 1st meeting to validated 
product concept
Cost $1,500 to ta...
Getting Quantitative:
Optimization Using Metrics

                    Copyright © 2010 YourVersion
Approaching Your Business as an 
     Optimization Exercise

Given reality as it exists today,
optimize our business resu...
Define the Equation of your Business
          “Peeling the Onion”
Advertising Business Model:
Profit = Revenue ‐ Cost

Equation of your Business
          Subscription Business Model
Profit = Revenue ‐ Cost

   Paying Users x  Revenue per Pa...
How to Track Your Metrics
Track each metric as daily time series
           Unique     Page       Ad      New User 
Sample Signup Page Yield Data
                                                Daily Signup Page Yield vs. Time
Identifying the  “Critical Few” Metrics
  What are the metrics for your business?
  Where is current value for each metric...
Metrics to Validate Product‐Market Fit
 Survey results
   Importance & Satisfaction
   Net Promoter Score

          Copyright © 2010 YourVersion
Adding Metrics and Optimization to 
             your Product Process
Optimization through Iteration:
  Continuous Improvement
                  the metric

Lean Product Management
            Cheat Sheet
Clarify problem space by iterating in the 
solution space & getting user f...
‐“Pandora for your real‐time web 
                      ‐Aggregates latest news, blogs, 
                             Copyright © 2010 YourVersion
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Elements of User Interface Design Consists of Three Distinct Elements: Information Architecture Structure and layout at both site and page level How site is structured (sitemap) Lean Product Management for Web 2.0 Products

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Elements of User Interface Design
Consists of Three Distinct Elements:
Information Architecture
Structure and layout at both site and page level
How site is structured (sitemap)
How site information is organized (site layout)
How each page is organized (page layout)
Interaction Design
How user and product interact with one another
User flows (e.g., navigation across multiple pages)
User input (e.g., controls and form design)
Visual Design
“How it looks” vs. “What it is”, often called “chrome”
Fonts, colors, graphical elements
Copyright © 2010 YourVersion

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