Product Management Product Metrics and Analytics

Question 1

What does 'DAU/MAU ratio' measure in product analytics?

Accepted Answer

User engagement and stickiness of a product

Answer

The DAU/MAU ratio measures how often monthly active users return daily, indicating how sticky and engaging the product is.

Question 2

What is 'churn rate' in SaaS product management?

Accepted Answer

The percentage of customers who cancel or stop using the product in a given period

Answer

Churn rate measures customer attrition — the share of users or revenue lost in a time period — and is a critical retention metric.

Question 3

What is 'North Star Metric' (NSM)?

Accepted Answer

A single metric that best captures the core value a product delivers to users

Answer

The North Star Metric is the one key indicator that reflects the product's primary value delivery and aligns the entire team around a shared goal.

Question 4

What does 'conversion rate' measure in a product funnel?

Accepted Answer

The percentage of users who complete a desired action out of those who started

Answer

Conversion rate tracks how many users move from one stage of a funnel to the next, such as from trial to paid subscription.

Question 5

What is 'Customer Lifetime Value' (CLV or LTV)?

Accepted Answer

The total revenue a business can expect from a single customer over their entire relationship

Answer

CLV estimates the net profit attributable to a customer over the full duration of their relationship with the product or company.

Product Management Practice Test