Finest-5 Product reads #53
Misleading LTV:CAC, Retail dark patterns, Product led sales, and other reads…
Hi, Happy Sunday ,
This week, I came across an interesting concept called the “Apple Pie Position” from Shreyas. It’s a simple yet smart idea that highlights how we sometimes align ourselves with something foolish just because it’s widely accepted or for other reasons. Check it out!
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LTV:CAC is a misleading metric to measure performance — here’s what to track instead
LTV:CAC is calculated using three variables (Average Rev Per Customer, Churn, and CAC) based on a point in time, which doesn’t factor in customer behavior that changes over time and which variable drives that change.
Key Takeaways:
- At the early-stage, almost nothing is fixed and so quantifying “lifetime value of a customer” at a single point in time just makes little sense and can overestimate or underestimate what happens at scale.
- By simplifying these three variables into a single number, you lose visibility into which variable drives changes over time and, therefore, how to pinpoint which specific actions to take.
- Use Cohort Customer Acquisition Cost Payback (CCAC Payback) and Customer Value Analysis (CVA) to measure customer acquisition and revenue contribution.
Which Retail Websites Have the Most Dark Patterns?
Dark pattern — a tactic used by retailers to trick online shoppers into completing an action that benefits the brand more than the customer.
Key Takeaways:
- The best way to defend yourself against dark patterns is by getting to know them
- A subscription that’s easy to get into but difficult to get out of is an example of a dark pattern known as a roach motel.
- Bad user experiences, including problems with unsubscribing, can drive away customers and negatively impact a brand’s reputation.
Product Team / Enabling Team Collaboration
As a general observation, product teams and enabling teams both have trouble accepting that their discipline can’t solve every problem.
Key Takeaways:
- Prioritise long-term gains over superficial metrics and invest in training, education, and onboarding for engineers and designers.
- Balance meticulous process and documentation with a focus on the end-to-end experience.
- Collaborate closely with enabling teams from the outset of new project
Your guide to product-led sales
The data is increasingly clear: it’s not PLG versus sales, it’s PLG AND sales.
Key Takeaways:
- Product-led sales involve users finding value in the product first, followed by sales reaching out to the right accounts.
- Data analysis is critical in a product-led sales approach to identify growth opportunities and optimize the user experience.
- The product and sales approach should be constantly evolving in a product-led sales strategy, with ongoing experimentation and iteration.
The first 90 day plan for new product leaders
Product managers ask ‘why’ within a limited scope, while product leaders consider it broadly for the company’s long-term success.
Key Takeaways:
- Build trust in the first 30 days by asking great questions, conducting formal/informal 1–1s, defining your management style, and gaining sound knowledge.
- Drive output in the next 30 days by road mapping, prioritising, planning, and delivering.
- Demonstrate leadership in the last 30 days by embodying a growth mindset, promoting inclusivity, and cultivating awareness.
Product of the week: magician
Every little thing it does is magic. A magical design tool for Figma powered by AI.
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