There’s not a perfect answer, but there are some principles.
- There’s a singular person (a CPO, VP of Product, CEO, Head of Product) leading the organization responsible for setting direction, vision, customer focus, and metric focus
- Each of the product owners should have tightly focused areas of interconnected responsibility. In the majority of cases, it’s easiest if each PM has 1 or 2 key metrics that they are focused on.
- When combined together, moving these metrics advances the company towards the product vision and increases the success of the company. If you move all your metrics up and the right and you aren’t improving as a business, it’s time to pick new metrics
- It should be obvious and apparent what area each product owner runs, what metrics they are responsible for, and how it impacts the business. If you have a PM working on special projects that don’t advance your startup, it’s time to question the purpose of the role (and you might need to fire the person if they can’t be repurposed)
- Product organizations are adaptable. As the business evolves, they need to grow and evolve with it, either to tackle new areas of the business or to fix problems in existing areas.
What follows are different examples of how you can think about structuring your product organization.
There are a number of key components to this business (and I’m intentionally leaving out fulfillment and shipping for simplicity):
- Acquisition of new customers through offsite channels like SEM, SEO, social, blogs, and other
- Getting the user acquainted with the site and trying to get them to register or at least search for or click on a product
- Helping the user find their first product
- Getting the user to make a purchase through the cart and checkout experience
- Bringing a user back through retention and re-engagement tactics
- Getting a user to become a repeat purchaser
Let’s pretend we are tasked with building the product team for this company. At a most basic level, it might look something like:
- A PM focusing on bringing new users to the site by focusing on SEO, social, SEM optimization with a key metric of new users brought to site
- A PM focused on funnel conversion from top to bottom of the funnel. Once a user visits a site for a first time or a repeat time, this product manager is deep in thinking through how to recommend the right products for the person, driving adds to cart, and then endless optimization of the cart and checkout funnel to ensure minimal dropoff along the way.
- A PM that is focused on retention and re-engagement. They will be focused on optimizing retention channels such as email, push notifications, loyalty programs, offers and offers. Their goal will be to drive users back to site who eventually convert through the funnel. Most of the time, they will be focused on measuring areas like email performance (measured through visits, OR, CTR), Push Performance (measured through push views and app opens from push), effectiveness of loyalty programs, and other areas
This structure provides a clear way for the entire company to understand the structure of the product team, what the different teams are focusing on, where resources are being deployed, and what metrics each team is accountable for.
Oftentimes, the real challenge with a P2P marketplace model is about being able to shift from one side of your market to the other as supply and demand ebbs and flows to make sure that each side can get what they need. If you have an incredibly strong amount of interested buyers coming to your site with no actual supply of product, then you need to adjust the structure and metrics that your product organization is focused on.
Let’s think about Airbnb as a case study (used here as an illustrative example, no one from Airbnb actually was involved in this post). The reason that much of their focus has been on growing the number of hosts (or at least it was for quite a while) is that they have a lot of inbound demand for rooms, but need to grow inventory in both existing and new cities to satisfy that demand.
Therefore, the challenge for their growth is not about bringing in more demand, but instead about how to create the supply side of their market. If you were to take this as a case study for how to structure product management or growth, you’d likely have a variety of PMs and teams focused on metrics like:
- Organic growth of new hosts (through both marketing channels and viral channels)
- Getting new hosts successfully through the process of setting up their home for listing on Airbnb (including adding house rules, getting the photographer to your home, and making the listing look successful)
- Getting a new host through the process of hosting their first guest (finding them a good guest, getting them their payment, setting them up for success)
- Getting the host to be a repeat host and retaining them and training them to have regular guests (lots of email, push, sending more users their way if they are a good host, getting them to keep their calendar up to date, etc)
- Creation of new guests who want to use Airbnb from offsite channels
- Getting a guest to find and book their first Airbnb
- Ensure that the guest has a great experience
- Getting the guest to come back and re-book with Airbnb for their next trip
How to Organize Your Product Team
Product as it’s own organization
Product Structured as a Growth Organization