Product Metrics

Product Foundations

What is a product engagement score? — The Guide

There is one conundrum that dictates the life of every Product Manager and Product Lead: no feature release goes exactly the way you’d like it to. Users are incredibly nuanced and opinionated, and no matter ) success depends on one singular thing — and that is user engagement.

User engagement is the analysis of how users engage with different features and elementhow much you like a feature, your features’ (and products's of your product. It is incredibly important to track and stay on top of what users want, what kinds of flows and experiences they prefer, what features they consider important, and what they consider friction.

To help with this, industry experts have created what is called “product engagement score”.

Product engagement score is a mathematical score that helps product teams discover how engaged users/customers are. Tracking this metric enables you to drive product-led growth, increase revenue, enhance the product's design, and introduce features that are in demand.

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What is a Product Engagement Score?

Product engagement score (PES) is a metric that offers insights into how your users engage or interact with your product. It’s a composite metric that combines three aspects of user engagement:

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Adoption rate: This is the average number of core events that active visitors, users, or accounts use or adopt. For eg: let's say you are building an e-learning platform. In this case, the adoption rat essential learning offerings.
Product stickiness rate: This is the average ratio of weekly active users who return daily or the percentage of monthly active users who return daily or weekly. Put simply, it's either DAU/WAU, DAU/MAU, or WAU/e would track how often users engage with theMAU. In the same example, stickiness measures how frequently users return to the platform to access new content.‍
Growth rate: This is the ratio of new (and renewed) accounts to the number of churned accounts, within a given period. For your e-learning platform, the growth rate evaluates the ratio of new sign-ups to users who churned or stopped using your service/product.

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These three metrics work together to offer you a holistic view of your product’s performance. You can get a clear picture of product engagement and identify areas for improvement by tracking these product metrics.

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How to Measure Product Engagement Score?

There are several ways to measure PES. Let’s discuss the main ones below.

1. Product Engagement Score » Formula #1

Product Engagement Score (Q1) = (Number of Events in Q1 / Total Users) * 100

This is a simple and common way to measure engagement based on user interactions. However, it does not capture the depth or quality of engagement. It treats all interactions equally.

2. Product Engagement Score » Formula #2

Product Engagement Score = (Adoption + Stickiness + Growth) / 3

This formula provides a more comprehensive and holistic view of user engagement. Besides, the formula is flexible; you can customize it based on your unique goals and priorities. You can assign different weights to adoption, stickiness, and growth components.

Product Engagement Score Example

Let’s understand PES with the help of an example. Picture this: You’re building a fitness app that tracks users’ daily fitness activities. You aim to calculate the PES for two quarters.

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Quarter 1:

100 new users signed up, and 80% completed onboarding (Adoption = 80%).
90% of users from the previous quarter continued using the app (Stickiness = 90%).
The total number of users increased by 10% compared to the last quarter (Growth = 10%).

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Quarter 2:

120 new users signed up, and 85% completed onboarding (Adoption = 85%).
92% of users from the previous quarter continued using the app (Stickiness = 92%).
The total number of users increased by 15% compared to the last quarter (Growth = 15%).

For Quarter 1:

Product Engagement Score (Q1) = 0.80+0.90+0.103 = 60%

‍For Quarter 2:

Product Engagement Score (Q2) = 0.85+0.92+0.15 = 64%

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The increase in the PES indicates a positive trend. The substantial increase suggests that the new features or enhancements resonate well with users. Hence leading to more interactions and engagement. PES is a simple yet effective way to showcase the product's growing popularity and user involvement.

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Why Measure Product Engagement Score?

As a PM, you aim to drive product usage and engagement with the right features and workflows. The product engagement score offers granular insights into how your users engage with your product every time they use it. It allows you to understand the reasons behind the changes in engagement. For instance, let’s say you observe a drop in your PES. You can further look at the three metrics that make up the score to see which one has decreased. Since the PES score tracks the quantitative elements, you must combine this analysis with customer feedback and surveys to make informed decisions.

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You should also uncover the nuances behind the drop in each metric. For instance, while measuring PES, you often find a lot of underutilized features. Now, what is the reason behind this? Are these features not liked by the customers? Or they might not know how to use the features properly. Or maybe they don’t even know the features exist. The answers to these questions can come only when you truly understand product engagement.

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With a composite analysis, you can create a cycle of measuring product usage and make improvements and iterations based on user feedback. All of these activities result in a better overall experience.

Best Strategies to Improve Product Engagement

Product engagement improves when consistently capturing, analyzing, and acting on customer feedback. Deep dive into what your data is trying to tell you, incorporate these insights with customer feedback and act upon it. You can also leverage the below ways to improve your product engagement score.

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1. Monitor the heart of PES: Adoption, stickiness, and growth

The three primary metrics that constitute the product engagement score are quintessential in tracking and improving PES. Are your product adoption and growth metrics where they need to be? Is your product sticky enough for your customers to feel they’re losing out when not using it?

2. Provide an excellent onboarding experience

A great onboarding experience is extremely important. About 55% of customers stop using a product or service they don't understand. You must ensure users aren’t confused and lost with your product during onboarding. They should be able to explore and understand all the essential features of your product at this time. Avoid overwhelming users with information. Instead, make the onboarding process short and try to cover all the basic features.

3. Engage customers and create usage habits

Once a user is onboarded, you can actively focus on keeping them engaged. Try to understand user preferences and behaviors. You can then use different channels like email, in-app messages, social media, and push notifications to personalize experiences.

Leverage segmentation to understand users' engagement levels. Win back inactive users with re-engagement marketing strategies.

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4. Gamification and rewards

Your customers often need a kick/push to use your product completely. Introduce point systems or badges to reward users for completing specific actions. You can also offer exclusive access to features or content for users who achieve particular milestones.

5. Segment and identify passive users,

If you have passive users, try to convert them. Passive users are close to becoming promoters and champion users of your product. However, they need encouragement to take that next step. When you re-engage your inactive users, they start seeing value in your product.

6. Learn from detractors and improve

Detractors are users who are not likely to recommend your product to anyone. Identify why they did not like your product and what can be improved. Leverage user surveys to gather specific feedback on features, usability, and overall satisfaction. Try incorporating this feedback in product development and improving the weak areas.

Enhance customer engagement with Houseware: Your go-to product engagement score calculator

Tracking product engagement is a quintessential need for today’s businesses. This is not to say instinct doesn’t play a big part in product management. It definitely does. But sharpening your instincts with an insight-driven framework can lead to more hits and fewer misses.

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Thankfully, multiple tools are available in the market now – such as Houseware, that can provide robust insights based on various product engagement metrics. These metrics include retention, growth, time-in-product, active user count, feature adoption rate, and stickiness.

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Unlike other analytics tools, houseware insights are easily consumable by non-product functions, like marketing or sales. Houseware eliminates ETL pipelines, opaque storage, and compute costs and uses your data warehouse to leverage data. With profound clarity to product-usage metrics, each business function can perform effectively and make better decisions.

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Houseware in action:

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Quizizz, a US-based ed-tech platform for classroom education, leveraged Houseware to replace their manual analytical processes with reliable insights. Houseware helped Quizizz get clear visibility into its customers’ behavior patterns. The Quizziz team learned to analyze key metrics to take informed initiatives and drive a significant uptick in product engagement.

Like Quizziz, you can also drive experimentation and see what features are being liked by your users and improvise on the ones that are not. Houseware empowers PMs to slice, dice, and visualize product data to enhance product experience (PX), keeping users engaged at every stage.

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Drive engagement with the right features and workflows. Book a call with us today to learn how to understand your users and discover what they want from your product.