CPM Metrics and Analytics

Question 1

What is the primary purpose of a North Star Metric in product management?

Accepted Answer

To represent the single metric that best captures the core value delivered to customers

Answer

A North Star Metric captures the core value the product delivers to customers and aligns the entire team around a shared measure of long-term success.

Question 2

Which metric measures the percentage of users who return to a product within a defined time period after their initial visit?

Accepted Answer

Retention rate

Answer

Retention rate measures the percentage of users who come back to the product after their first experience, indicating ongoing value delivery.

Question 3

What does a high DAU/MAU ratio indicate about a product?

Accepted Answer

Users engage with the product frequently throughout the month

Answer

A high DAU/MAU ratio (closer to 1.0 or 100%) indicates that a large proportion of monthly users engage with the product daily, signaling strong habitual usage.

Question 4

What is 'churn rate' in the context of subscription-based products?

Accepted Answer

The rate at which existing customers cancel or stop using the product

Answer

Churn rate measures the percentage of customers who cancel or stop using the product over a given period, directly impacting revenue and growth.

Question 5

What does Net Promoter Score (NPS) primarily measure?

Accepted Answer

The likelihood that customers would recommend the product to others

Answer

NPS measures customer loyalty by asking how likely they are to recommend the product on a 0–10 scale, then categorizing respondents as Promoters, Passives, or Detractors.

CPM - Certified Product Manager Practice Test

CPM - Certified Product Manager Practice Test

CPM Metrics and Analytics