Is Product Analytics the natural evolution of Digital/Web Analytics?

Product Analytics has seen a major surge in interest ever since the acceleration of digital transformation took hold during the Covid-19 pandemic. Deep interest in understanding how customers are using digital products, their navigation through it, understanding what drives user engagement and more are central tenets of Product Analytics and inform improvement in digital products.

In some circles, Product Analytics is seen as the natural maturation of the field of Digital Analytics, but now going well beyond the traditional website into all forms of Digital Products. Many of the concepts of Digital analytics -ranging from understanding user navigation, time on page, return visits, to visitor engagement patterns, transfer directly to the broader notion of Product Analytics.

One significant objective of Product Analytics is to get the customer to expand their engagement with the product, apply it to multiple use cases, and eventually renew product purchase. Traditional web analytics may have many different objectives, depending on the nature of the website, though one part of it is definitely devoted to conversion paths, fall-out analysis and purchase.

At its core level, the notion of visits, visitors, # of sessions, as well as Path Analysis through the product are fairly easily transferable notions between the fields. Running A/B tests on a Digital Product is quite well-understood, and the many useful learnings from this work in Web Analytics carry over directly as well. Product Analytics does rely a bit much on the concept of "events", though it is not a new concept at all.

But Product Analytics does cover more channels than just the website - it touches upon connected devices, mobile apps and other endpoints that are part of the portfolio offered by the brand. Thus, customer behavior for Product Analytics must be understood across all relevant channels to know the experience the customer is having. And of course, consumers of Product Analytics are Product Managers, not necessarily traditional Digital Marketing managers - with correspondingly different goals.

A recent Harvard Business Review survey indicated Product Analytics as the #1 (with 58% of respondents saying this) field that companies are paying attention to for improving their Offerings, exceeding even BI and in-house analytics. And as one might expect, predictive analytics is playing a role within Product analytics to identify features that may drive increased engagement, better experience and renewal.

As we move forward, Product Analytics will continue to separate itself as a complete discipline unto itself, with more vendors coming into this space, and more Product Analytic Specialists getting trained to help drive product adoption, experience and purchase. And in due course, something that makes this field very unique will develop as well.