In the ever-evolving world of product management, a new breed of professionals has emerged: growth product managers. These specialists are reshaping the landscape of product development and strategy, focusing on driving rapid expansion and user acquisition. As companies increasingly prioritize growth, the demand for product managers with a keen understanding of growth strategies has seen a significant uptick.
The distinction between growth product managers and traditional product managers is crucial to comprehend. While both roles share a foundation in product development, their approaches, objectives, and key performance indicators differ substantially. This article delves into the key differences between these two roles, exploring their unique focuses, skill sets, and metrics. By understanding these distinctions, organizations can better align their product management strategies with their growth goals and market positioning.
Focus and Objectives
Traditional PM Focus
Traditional product managers primarily concentrate on driving value for the customer. Their approach assumes that by solving customer problems, they will simultaneously create value for the business 1. These product managers focus on the overall product strategy, roadmap, and general direction of the product, balancing near-term customer and business needs with a longer-term perspective 2.
The traditional product manager's role involves owning the product vision and roadmap, with a broader scope that encompasses the entire product lifecycle 3. They are responsible for defining and executing the product strategy, ensuring it aligns with the company's overall objectives while meeting customer needs.
Growth PM Focus
Growth product managers, on the other hand, have a distinct focus that sets them apart from their traditional counterparts. Their primary stakeholder is the business itself, and their goal is to align customer value with business value 1. Growth PMs aim to improve specific business metrics and optimize products to help organizations achieve particular goals, such as revenue growth, customer acquisition, retention, increased web traffic, or expanding market share 1.
A growth product manager's role revolves around identifying and executing product-led growth opportunities in acquisition, engagement, and retention 3. They focus on removing barriers to value and prioritize initiatives that drive the most significant business outcomes 4. This approach often involves working on short-term improvements and running rapid experiments to drive incremental growth 2.
Comparing Objectives
To better understand the differences between traditional and growth product managers, let's compare their objectives:
Traditional PMGrowth PMFocuses on overall product vision and strategyConcentrates on specific business metrics or goalsBalances long-term and short-term needsPrioritizes short-term improvements for rapid growthAssumes customer value drives business valueActively aligns customer value with business objectivesOwns the entire product lifecycleFocuses on specific parts of the conversion funnelDevelops comprehensive product roadmapsRuns rapid experiments for incremental improvements
Growth product managers are often found in companies that deploy a product-led growth strategy 2. Their role involves leading experimentation and data-driven decision-making to drive products to reach the next level of scale, impact, and profitability 2. They use experimentation to find solutions that give disproportional results in regards to a product's growth 2.
To be effective, growth product managers must possess several core attributes:
- Genuine curiosity to experiment and measure impact
- Strong analytical skills and a data-driven approach
- The ability to identify and reduce friction in the user experience
- Excellent communication skills to make compelling business cases
- A deep understanding of customer needs and behaviors 4
Growth product managers are responsible for defining the company's growth goals, identifying experience gaps, measuring progress, and analyzing customer behavior 3. They build and execute experiments, often in collaboration with marketing, development, and design teams, to understand what customers engage with better 3.
While traditional product managers and growth product managers have distinct focuses, it's essential to recognize that they need to work closely together in organizations 2. The partnership between these roles ensures a balanced approach to product development, combining long-term vision with data-driven growth strategies.
In conclusion, the focus and objectives of traditional and growth product managers differ significantly. Traditional PMs concentrate on overall product strategy and customer value, while growth PMs prioritize specific business metrics and align customer value with business goals. Understanding these differences allows organizations to leverage both roles effectively, driving product success and sustainable growth.
Skill Set and Expertise
Traditional PM Skills
Traditional product managers possess a diverse skill set that forms the foundation of effective product development and management. These skills include strategic thinking, which allows them to set long-term goals, understand market trends, and align product vision with business objectives 5. Technical expertise is also crucial, enabling effective communication with engineering teams and informed decision-making 5.
A user-centric approach is vital for traditional PMs, involving the ability to understand user needs, empathize with customer experiences, and translate these insights into product features 5. This skill set is complemented by strong analytical capabilities, as PMs must interpret user data, market research, and performance metrics to understand trends, measure product success, and identify areas for improvement 5.
Leadership skills are essential for traditional product managers, going beyond team management to inspire, guide, and motivate cross-functional teams towards a common goal 5. Effective communication remains a cornerstone skill, with the ability to articulate ideas clearly, negotiate with stakeholders, and convey the product vision to diverse audiences 5.
Growth PM Skills
Growth product managers share many skills with their traditional counterparts but have a specialized focus on driving rapid expansion and user acquisition. A fundamental skill for growth PMs is a strong data-driven mindset 6. They must be adept at digging deeper into analytics, testing possibilities, and obtaining clear, measurable results 6.
Growth PMs need a fluent understanding of pirate metrics: Acquisition, Activation, Retention, Referral, and Revenue 6. This focus on numbers requires mastery over experimental design, including the ability to craft experiments, run them in parallel, isolate their impact, and determine how long it takes for test groups to reset to baseline behavior 6.
Creativity is crucial for growth PMs to discover novel ways to improve key metrics 6. They must also possess a deep understanding of user success factors and current pain points, driving a customer-centric approach to help users understand the product's value and increase retention 6.
Collaboration is essential for growth PMs, as they often work on features owned by other teams. This requires strong negotiation skills to convince stakeholders of the positive impact of their initiatives 6. Additionally, growth PMs need to demonstrate strong marketing and research knowledge to solve problems and deliver satisfaction to existing and potential users 6.
Key Skill Differences
While traditional and growth product managers share a foundation in product development, their approaches and focus areas differ significantly. The primary distinction lies in their stakeholder focus and mindset. Traditional PMs consider the end user as their primary stakeholder, while growth PMs view the business as their primary stakeholder 1.
Growth PMs must align customer value with business value, solving business problems by addressing customer needs 1. This shift in mindset can be challenging for those transitioning from traditional to growth product management roles 1.
Data-driven decision-making and quantitative skills are particularly critical for growth PMs. They are often tasked with improving specific business metrics such as revenue, customer acquisition, retention, web traffic, or market share 1. This requires a deep dive into product data to understand which actions move the needle on the company's commercial goals 1.
Experimentation is at the heart of a growth PM's role, with a high appetite for ambiguity and comfort with failure 1. Growth PMs must be prepared to be wrong a significant portion of the time, as they engage in "trial-and-error" initiatives to see what works 1.
Communication skills, particularly storytelling techniques, are crucial for growth PMs. They must constantly rally support for their initiatives, selling their product vision to teammates and leaders 1. This requires strong verbal and written communication skills, as well as the ability to use visual media effectively 7.
In conclusion, while both traditional and growth product managers share foundational skills, growth PMs require a more specialized skill set focused on data analysis, experimentation, and aligning business goals with customer value. As the product management landscape evolves, adaptability and continuous learning remain essential for success in both roles.
Metrics and KPIs
Traditional PM Metrics
Traditional product managers rely on a set of key performance indicators (KPIs) to measure the success of their products and strategies. These metrics provide valuable insights into product performance, helping PMs make informed decisions and drive continuous improvement 8.
One crucial KPI for traditional PMs is the Customer Acquisition Cost (CAC), which measures the total cost of acquiring a new customer. This metric includes expenses related to marketing, sales, and other customer acquisition activities. By tracking CAC, product managers can evaluate the efficiency of their acquisition strategies and optimize them for better results 8.
Another essential metric is the churn rate, which measures the percentage of customers who stop using a product over a specific period. A high churn rate indicates that customers are not finding sufficient value in the product, highlighting the need for improvements or additional features 8.
Customer satisfaction and loyalty are often measured using the Net Promoter Score (NPS). This metric is calculated based on responses to a single question: "How likely is it that you would recommend our product to a friend or colleague?" NPS provides valuable insights into customer sentiment and helps product managers identify areas for improvement 8.
For subscription-based products, Monthly Recurring Revenue (MRR) is a critical financial KPI. It measures the predictable and repeatable revenue generated from subscriptions or recurring billing, giving product managers a clear understanding of revenue trends and the impact of customer retention on financial performance 8.
Growth PM Metrics
Growth product managers focus on metrics that directly impact rapid expansion and user acquisition. These PMs often use the "pirate metrics" framework, which includes Acquisition, Activation, Retention, Referral, and Revenue (AARRR) 6.
One key metric for growth PMs is the user activation rate, which measures the percentage of users who have adopted a new feature or functionality within the product. This metric helps assess the success of feature launches and understand user behavior and preferences 8.
User engagement metrics, such as Daily Active Users (DAU), Weekly Active Users (WAU), and Monthly Active Users (MAU), are crucial for growth PMs. These metrics provide insights into how actively users are interacting with the product, helping PMs understand user behavior, identify patterns, and make data-driven decisions to improve the overall user experience 8.
Growth PMs also pay close attention to conversion rates, which measure the percentage of users who take a desired action, such as signing up for a product, making a purchase, or upgrading to a premium plan 9.
The stickiness ratio, calculated as DAU/MAU, is another important metric for growth PMs. It reflects the product's ability to retain users over time and encourage frequent usage 9.
Comparing Performance Indicators
While traditional and growth PMs share some common metrics, their focus and priorities differ. Traditional PMs tend to concentrate on overall product health and long-term success, while growth PMs prioritize metrics that drive rapid expansion and user acquisition.
Here's a comparison of key performance indicators for traditional and growth PMs:
Traditional PM MetricsGrowth PM MetricsCustomer Acquisition Cost (CAC)User Activation RateChurn RateConversion RateNet Promoter Score (NPS)Stickiness RatioMonthly Recurring Revenue (MRR)Daily/Monthly Active Users (DAU/MAU)Feature Adoption RateReferral Rate
It's important to note that while these metrics are often associated with specific PM roles, both traditional and growth PMs may use a combination of these indicators depending on their product's goals and stage of development.
Both types of PMs should focus on metrics that are specific, measurable, achievable, relevant, and time-bound (SMART) 10. By carefully selecting and tracking the right KPIs, product managers can ensure they have a holistic approach to measuring and managing their product's success, aligning their efforts with both short-term growth and long-term sustainability.
Conclusion
The distinction between growth product managers and traditional product managers has a significant impact on product development strategies and organizational success. Growth PMs focus on driving rapid expansion and aligning customer value with business objectives, while traditional PMs concentrate on overall product vision and long-term strategy. This difference in approach leads to varied skill sets, metrics, and priorities, enabling companies to tailor their product management roles to specific goals and market positioning.
As the product management landscape continues to evolve, the roles of both traditional and growth PMs remain crucial to product success. The partnership between these roles ensures a balanced approach, combining long-term vision with data-driven growth strategies. To stay ahead in the competitive market, companies need to understand these distinctions and leverage the unique strengths of both roles to drive innovation, user acquisition, and sustainable growth.
FAQs
1. How do growth product managers differ from traditional product managers?
A growth product manager (GPM) specifically aims to enhance certain aspects of the conversion funnel that directly impact business metrics such as sales or retention. In contrast, a traditional product manager oversees the entire product, focusing on broader responsibilities. Additionally, the time horizons they focus on tend to differ, with growth PMs often concentrating on immediate, metric-driven outcomes.
2. What distinguishes a core product manager from a growth product manager?
Core product managers primarily address customer needs and pain points, concentrating on developing new features. Growth product managers, however, focus on optimizing the customer journey to improve specific business metrics. This role is distinct from platform product managers, who aim to scale business operations efficiently.
3. What is the role of a growth product manager?
A growth product manager (GPM) is dedicated to enhancing a particular business metric or goal, such as acquisition, activation, retention, referral, or revenue. They achieve this by identifying and removing barriers that prevent customers from realizing value from the product.
4. What is the difference between product marketing management (PMM) and growth product management?
While both roles aim to improve product performance, their focus areas differ significantly. Growth product marketing concentrates on driving feature adoption, activation, and retention post-launch. In contrast, product marketing management focuses primarily on the initial launch and the go-to-market strategy of the product.
References
[1] - https://theproductmanager.com/topics/growth-product-management-vs-traditional-product-management/
[2] - https://www.antmurphy.me/newsletter/product-manager-vs-product-marketing-manager-vs-growth-pm-whats-the-difference
[3] - https://userpilot.com/blog/what-is-a-growth-product-manager/
[4] - https://www.productplan.com/glossary/growth-product-manager/
[5] - https://www.tealhq.com/skills/product-manager
[6] - https://www.productledalliance.com/the-essential-skills-you-need-to-be-a-successful-growth-pm/
[7] - https://www.hotjar.com/growth-product-management/growth-product-manager/
[8] - https://www.linkedin.com/pulse/key-performance-indicators-kpis-product-management-ankita-panpatil--tj9jf
[9] - https://www.altexsoft.com/blog/15-key-product-management-metrics-and-kpis/
[10] - https://www.linkedin.com/pulse/power-metrics-okrs-kpis-action-product-managers-naman-raval