How much attention do you pay to product usage data?
The benefits and best practices are common knowledge by now – we all likely know the potential wealth of information contained within software usage analytics – but how much time do you commit to reviewing and learning from the insights at your fingertips?
When hit with never-ending questions about feature development, roadmaps, and bug fixes, it’s easy to skip the routine of stepping back and studying customer behavior data. However, when all your energy is focused on emerging priorities and ‘shiny new things’, it’s almost inevitable to miss game-changing observations staring you in the face.
What is Product Usage Data?
Product usage data is the key to unlocking future pathways, allowing you to make informed decisions based on facts rather than feelings.
Ultimately, gaining clarity into user activity and environments enables you to establish trends that can lead to better products and happier customers.
Stakeholders from across your organization can use these insights to establish:
- Monetization models
- Feature prioritization/deprecation
- UI/UX design
- Piracy tracking
- Marketing campaigns
- Churn risk – allowing customer success teams to proactively reach out to address concerns and boost engagement.
Additionally, as suppliers increasingly move toward SaaS and hybrid deployment options, product usage data is integral to modern licensing strategies, such as consumption-based and metered pricing.
Usage Analytics Report
As part of the annual Monetization Monitor series, Revenera has published a new report exploring trends in usage analytics.
Based on a global survey, the results confirm product usage data has become increasingly important to software suppliers, with headlines including:
- 80% will collect product usage data by 2024
- Reliance on manual approaches is down from 44% to 35% year-over-year
- However, only 52% of those who collect usage data can tell if customers actually use their product
The full report covers more detail, but here are a few highlights:
Data Collection Confidence
While 80% are either collecting product usage data today or plan to by 2024, a further 11% confirm they intend to in the future but are unclear on customer acceptance or where they stand with regards to data privacy.
The remaining 9% with no plans to capture usage data are in the clear minority, but it’ll be interesting to see how this trend develops in the coming years as gathering usage intelligence has so many advantages that stragglers may find themselves moving in this direction.
Growth in Usage-based Monetization
As perpetual licensing gradually fades and suppliers embrace new monetization models, product usage data will be key to those adopting usage-based pricing, which is expected to grow by a healthy margin.
Naturally, usage analytics is recommended for all other licensing strategies as the insights can strengthen product development, positioning, and customer relationships, but it’s practically essential for usage-based monetization.
Approaches to Collecting Customer Insights
When asked about “highly effective” methods for collecting customer feedback, customer interviews are the top qualitative approach while advanced product usage analytics are the top quantitative approach:
While direct customer communication has clear benefits, this manual approach requires a significant time commitment and doesn’t scale with ease. Therefore, having automated quantitative product usage data is key to developing rounded insights that can corroborate or challenge anecdotal exchanges.
Managing Customer Lifecycles
Surprisingly, only 49% of respondents say they track customer renewal dates, indicating significant room for improvement on a vital data point for revenue optimization.
Those using purpose-built entitlement management systems over homegrown or manual approaches are best placed to track all customer entitlements/use rights, with 64% answering positively.
Being able to share product usage data and have open conversations with customers about entitlements/use rights and feature adoption facilitates healthy two-way communication, ensuring customers get the most value from their investment, which improves the likelihood they’ll renew.
To get the full picture on product usage data trends, please download the full Monetization Monitor report and see how your strategy compares to industry peers.