The main thing is about the tools and rules of product analytics.

After the release of the product to the market, what the product was created for begins — development in order to maximize profits. The basis of this development is product analytics. It is often silent about it, and its results are presented as the expertise of individuals. 

Proper product analytics is the main driver of business performance growth. Nurlan Tokashev, a leading product analyst at tekmates*, talks about what it is and how to build it.

*tekmates is a technology business partner that helps companies realize their business missions through effective digital solutions. Until April 2024, the company operated under the brand red_mad_robot Central Asia.

Product analytics is an approach to product development based on data collection, analysis and interpretation. As part of product analytics, the company studies how users interact with the product and assesses how conveniently and effectively it solves their problems.

Product analytics began to be used more than 20 years ago. Google has become the pioneer and now the flagship of this approach. At the beginning of the century, the company analyzed data on small businesses in the field of marketing and realized that businesses needed a new advertising tool. Based on this data, Google launched a service to launch online advertising, AdWords, now called GoogleAds. 

Over the past 24 years, the service has been constantly being refined based on data received by product analysts. Today, Google Ads is the main "fuel" of the company. In 2023, Google's advertising revenue totaled $237.86 billion.

Product analytics consists of several pillars: a team, tools, and processes. And the result of this mechanism is insight — useful information for decision-making.

— Nurlan Tokashev, Leading Product Analyst at tekmates

The IT market of Kazakhstan is in a stage of rapid development. Despite this, not all companies still have product analytics. It happens that the company's management is not aware of product analysis, or underestimates its benefits, striving for quick results. Product analytics is a long—term game. It is important to understand that impressive results can be achieved only with a systematic approach.

The core of any product department is a professional team. There are several roles in it: product manager, analyst, data analyst, and development team. Everyone must follow their instructions clearly in order to lead the whole company to success.

Comparing the field of team play and the grocery department, the ideal distribution of roles will be as follows:

• The grocery manager. The captain, who determines the strategy of the game and coordinates the actions of all players. He is a leader who interacts directly with the "coach" — the management — and evaluates the "rivals" — the market. 
• A product analyst. The goalkeeper anticipates and hits back — covers the weaknesses of the product. He analyzes the growth points and makes a successful "pass" that sets the start of the next half.
• A data analyst. A defensive player. By confirming or refuting the data, it helps the attackers — that is, the development team — to create a new breakthrough solution.

Developers, including designers. Offensive players who actually embody the captain's strategy and instructions. They develop IT solutions, playing from the "pass" of a product analyst.

Another important pillar of product analytics is advanced tools. Here are examples of some of them.

A behavioral analytics system. It captures user actions and independently visualizes critical indicators. With the help of Amplitude, experts identify anomalies that affect the financial metrics of the product. 

A tool for analyzing the interface. It allows you to understand user behavior on pages, identify the most frequently used functions, button clicks, and interactions with elements. By using Hotjar, the development team can improve the product interface on an ongoing basis — this increases sales figures and reduces user outflows. 

It is important to understand that each tool is individual and differs from the product and product strategy. Therefore, it is necessary to have experienced specialists in the team. They will make the right choice based on the details and subtleties.

— Nurlan Tokashev, Leading Product Analyst at tekmates

Quite often, companies resort to the experience and knowledge of internal specialists to organize the work of the product department. Their ideas and developments play an important role, but it is important to follow modern practices. 

Processes at tekmates are a key element of the product analytics department. The following processes are present in each project of the company: 

• Monitoring. With the help of visualization tools and user feedback, the product analyst monitors the current state of the product and looks for growth points.

• Analysis. The found anomalies and growth points are taken into account. The analyst makes assumptions about the reasons for the drop in metrics and possible options for refining the product that will increase the indicators. 
• Testing. When there are several hypotheses, you need to confirm them through an A/B experiment. To do this, a modified version of the digital product is being created, which, according to the analyst, will increase performance. The new version is being tested on a certain number of users — for example, 10% of all current ones. After the experiment, the specialist analyzes the alternative and main product variants using mathematical algorithms. If it is clear that the new option is better, you need to decide whether to make this change to the main product.

• Release. After the experiment, the costs of the full development of the solution are considered, as well as the profit that the product will receive after the implementation of the solution. If calculations show that the solution will be beneficial, it is transferred to the main product in full.

This algorithmic approach protects against unnecessary development costs and possible deterioration of indicators. With the help of A/B experiments, it is possible to accurately assess the consequences of decisions made.

Now we are actively developing the direction of product analytics with our current partner: a product team has been assembled and the necessary tools have been implemented. Employees are aware of the current state of the product, and the management team adjusts its strategy in the market. Meanwhile, the product team is actively developing the competitiveness of the product, finding new points of contact with users and improving financial performance.

— Nurlan Tokashev, Leading Product Analyst at tekmates

To start implementing product analytics in your company, you need to do the following:

1. Assemble a team. Start the process of implementing the analytical infrastructure with a product analyst. Gradually expand the team and clearly divide it into roles to maximize efficiency.

2. Use advanced tools. For example, those that we described in the article. Or trust the experience of specialists who will select the tools for the specifics of your product.

3. Build the processes according to the scheme: monitoring → analysis → testing → release. Pay special attention to the testing stage. It will help to more accurately determine the effect of the introduction of new solutions.