How Feature Announcements Can Lead to Happier Customers, w/ Eric Boduch, Co-Founder of Pendo

Hello and welcome to another edition of Product Lunch. Really glad to be here. I'm filling in for Mike Belcedo, your usual host. I am the other half of Product Collective, the other founder, Paul MacEvinci. So I'm really excited to do this. I've been meaning to get on one of these before and have a great conversation with people like Eric Bodak, our guest for today. Before we get started, I just want to run through a few quick things. If most people, I think, will know of our conference coming up in 4 weeks' time, Industry: The Product Conference. It's been held in Cleveland, and we will likely have about 700 or 800 people come from all over the world. We've people come as far as Singapore and Australia. Maybe we have some of those folks here today. We'd really like to see you there. We have working sessions on as part of a half-day session with either Bob Messer, Dan Olson, or Cindy Alvarez. And I just wanted to give you a heads up that these are just about sold out. So go to indsum.com to see more information about the event and the working sessions. We also have another product launch coming up on September 6th, so look out for that too. Go to productlaunch.com. So today, I'll jump right into it. We are joined by Eric Boduc of Pendo. And I'll tell you a little bit about Pendo. This is from Eric's mouth. Pendo provides robust product analytics, feedback collection, in-app announcements, and personalized guides, all built upon a common infrastructure of product data. In short, it's a platform for product people to make better products. So I'm really excited to have you here, Eric.

Thank you. It's great to be here.

Awesome. So Eric is the founder, the co-founder, I believe, of Pendo. So I wonder, actually, let me just say one thing. If you have any questions, there's a little question feature box down there, the link, click on that. Ask your questions, vote up your favorite ones, or you can throw in your questions in the little message box to the right here. We also love to hear who you are and what you're working on and where you are, so type in there and we will be able to see where everybody's from. And if you have any questions, ask them and we'll try and get to them with Eric as well. So going back, Eric, excuse me, tell me a bit about how you came to find found Pendo, and what was your frustrations at the time too that kind of led you to that pursuit?

Sure, so there was 4 of us actually, 4 co-founders. We had all worked in product before. One of the frustrations we always had was how do you understand how users are using your product? Are they getting value out of it? Are they accomplishing tasks easily? All of this data was often really difficult to get. Best case, you know, we'd go to engineers, we'd beg, borrow, and steal, we'd instrument part of our applications to get that data. It was difficult. It wasn't real-time. It wasn't always there. We didn't have all the data we wanted. So we always thought there would be a great opportunity to build a company that made it easy for product managers to get data so they didn't have to rely on engineers to deliver the out of the hands of the product managers. So that was kind of the, the thought behind Pendo. That's, that's where it started. That's how it came about. From there, we quickly determined, well, wouldn't it be great with all this data if we can give product managers to act some way, to act on it right away? You know, there's frustration that, like, there's all these great things, we're going to move them into a new sprint, we're going to do this in the future, this is how we can fix how they, you know, create landing pages or set up servers or whatever the task happened to be. But then we started thinking, well, wouldn't it be great if we could do something right away? And the right away turned into, could we provide them in-app messaging guidance, contextual help? So instead of just understanding where they struggled, we could help them not struggle immediately. It didn't have to wait for a UX improvement or didn't have to wait for us to add a new feature or clean something up. We could help them through in-app messaging and guides right away. So that was the, the, the second piece of what became Pendo. Then we added things like NPS and other feedback collection surveys onto that. So really, Pendo is a platform that spans those areas you mentioned before, where we can help people understand how their users are using their software and guide them through that experience so they can accomplish tasks better. So that's— those were the ideas behind Pendo. It was born from 4 product managers Added a fifth early on, actually one of the, the Google product managers who used to work for Marissa. So we had done product management at companies like Cisco, Raleigh Software, Red Hat, Google, Vitria, all kinds of different companies, and really decided we wanted to build a company and a product for ourselves to some extent. So now we— our goal is to just build, help people create products that customers love.

Excellent, excellent. And so our conversation today is focused around feature announcements and how they can lead to happier customers. And we know that Pendo is a platform that allows you to do really effective feature announcements, but let's kind of look at a very kind of basic sense. What is a feature announcement and why does it matter?

Sure. So, I mean, I guess I'm, I'm showing how old I am right now, but I grew up in a world where there was manuals, right? So, you know, there'd be a new manual that came out and that was the earliest form of a feature announcement. It was like version 1.2 and here's a little list of the new features. But you can really— feature announcements, any mechanism you can use to communicate a feature. You could do it, you know, through manuals like back in the day. You could do it through emails. You can call your customers up on the phone and talk to them about, you know, new features you have. You might have a webinar. And then a lot of cases you see more and more people doing it in the product itself, where they— when the user's there, they can actually point out the new feature and teach the users how to use it. But you can announce features in lots of different ways. You know, you can have people show up at your customers' doors like those old feature-o-grams kind of thing, right?

And that would be interesting. That's a good— that's a part of your next product.

I don't recommend that one. It might be a little creepy. Yeah, you might freak people out.

And so for in an online sense, what goes into the perfect feature announcement?

Sure. So I mean, first, You know, thinking about why they really matter, you know, feature announcements in and of themselves are important because we live in a world now where the buying cycles are really driven by customers. So I like to say, you know, recurring revenue means you have to deliver recurring value. And the way customers look at new value is, have you created new features that help me do my job better, that help me accomplish tasks? So I think, you know, that's, that's really important for you to think about why features matter. It's all about delivering value to customers and helping them accomplish their tasks so they continue to pay more money. Then I guess going into the perfect feature announcement, right? If we think about the perfect feature announcement, there's two main components. One is relevancy. I think it's very important that you target feature announcements to the particular people that they're important to. You know, like we were talking before we started about, you know, admin roles, you know, and we— if you have a new feature that teaches someone how to set up a staging server, well, that, that might only be important to a particular role, say the admin, but it might be very important to them. So it's great that you announce that feature to them, but say maybe an everyday user isn't as concerned with setting up staging servers. So really, you don't want to overwhelm them with information that's not important to them. So if you're doing in-app announcement of features, it's very important that you understand and segment your users so you can announce things that are relevant to them. The second thing, you know, after you have that right target for the feature announcement is thinking about what the call to action is. It might be that it's a good idea to take them through how to work on that feature right there. It might be that you want to announce the feature but push them over to your blog of the announcement or additional documentation, or maybe a video you have on YouTube or Vimeo or something that teaches them why that announcement is important. So it could be all kinds of different things, but the two main components I think is relevancy. Is that feature announcement targeted to the right people? And then call to action. Is there a call to action that helps them adopt that feature? Because really when it comes down to it, it's really important that, you know, feature announcements aren't just for feature announcements. It's not just for the sake of saying, hey, we did this. You're doing it because you think it needs to be adopted by your customers. It's going to make your customers or some segment of your customers' value better or lives better. It has to deliver value to that segment. So really you're thinking about, you know, feature announcements, why they matter, and the perfect feature announcement with this idea of adoption. Right.

It's kind of funny as you're talking there, it almost seems like this is somewhat a marketing function. Why does this involve the product manager as opposed to the marketing person?

Yeah, you know, I think that's important. It goes back to, you know, my old career in the early days of gold disks and stuff and building software. You know, if you rely on marketing to educate, that's good, but you have a vested interest in making sure these features are actually adopted, right? You own this product, or at least, you know, you're the guardian of the product. So you want to make sure that not only do the announcements get out there, but the right customers are adopting and using it. It's very important that products takes ownership from that, doesn't just think about it purely as something someone else to do. You know, we used to think about the big finish line was when we announced the new product or a new version, and in this case maybe a new feature. But the finish line should not just be when it's announced. The finish line should be when it's adopted, when customers are using it, when they're getting value out of it, and even better, when they advocate to others about it. Like, oh, did you see, you know, Pendo has this great new NPS feature. It's helped me do this and this and this. That's Awesome. If people can do that, tweet about it, write LinkedIn posts about it, if it, you know, becomes part of one of the blogs they're writing, that's awesome stuff. So we want to think about it not just as a marketing, you know, project to announce something, but it's a goal for adoption, just like you want to have adoption in your product as a whole.

Interesting. So there are best practices, but where do product managers fall down when it comes to the task of doing feature announcements? What— where do most people get it wrong as opposed to right?

Yeah, so I think the first mistake that product teams make is not getting involved, just like we talked about. They don't get involved in feature announcements in the first place, and they hand it over to marketing and they don't follow up. That's what I would call the first mistake, because you really want to make sure that you're measuring and understanding adoption. It might be that the way you rolled it out or the way the feature works, you know, isn't what customers want to see. And if you're tracking that usage, you're tracking that adoption, and you're looking at it actively against what your goals for it were, you have that first early indicator to that. The second mistake, like we talked about before, is targeting, right? If you think about when they fall short, there's— you don't want to just blast features out to everyone. They get overwhelmed. So you want to make sure the announcements you push out there are relevant to the particular users you're pushing them out to. Some announcements are important to everybody, but in a lot of cases they're more important to particular people, so you want to highlight that. Another really cool thing you can do there is, is actually wait, you know, push a feature out there, do maybe some minor announcement, and then see what adoption's like, and then push out the announcement later just to people who haven't used that feature yet. Like, oh, did you know we announced this new spellcheck feature for our word processor? I see you haven't used it, you know, in the 30-day— in the last 30 days since it's been announced. Maybe you missed it. Let me walk you through right in application how it works. That's a really powerful way you can use to target announcements too. The third thing I think is using the right channel. You know, doing things inside application isn't always the way you want to do things. It could be Certain things are important to announce in-app, other things maybe you want to reach out via email, especially if you're reaching out to users that aren't actively there. So there's a combination of mechanisms you can use to announce new features. I highly recommend getting your CS organization involved too when they're, you know, talking to the customers, their customer success organization for those of you who don't know what CS is. All these acronyms, try to not use any of them. But, you know, get them involved. They might do webinars. Monthly or quarterly talking about product direction, you know, that's a perfect opportunity to deliver this message too. So that's kind of the third mistake we see is, are people using the right channels? Are they using enough of the right channels? Deciding what should be externally announced, what shouldn't, and just having that right mix based upon the segment that it's important to people. And then finally, probably most importantly, is it's great to do all these things, but you really need to measure. You need to test things, you need to measure, you might want to A/B test your messaging, you want to— might want to measure the adoption against the goals you put in place. All these things are really important, these measurements, you know, because that's what leads into process improvements for the future.

Excellent. And actually, we'll lead me to the next question, but I want to first say I am actually having a bit of trouble with the messaging system on the side, so if you want to ask a question, go into the question feature in the bottom left there and click on ask a question. Jill Manuel has asked a question and it kind of relates to what we were speaking about there. What are some effective follow-up action steps to a feature announcement?

Sure, I, I think first is looking at how well, uh, the features got adopted. So say you have customers that are in there every day, if you announce a feature 7 days later how many of those customers that you've targeted are actually using it. That gives you data on which to take next steps. So if you don't see a lot of adoption— if you do see a lot of adoption first, then that's great, you know, maybe you just push that along a little bit. You know, what you don't want to be is, uh, you don't want to keep pushing stuff out and overwhelm your customers inside your product. Like, I hate when I get announcements in a product I'm using that are things I've already used, things I already know. An announcement I just got 2 days ago, a feature I'm actively using So it goes to that site. Second thing, when you get this data out of there is that if they aren't using the product, maybe you wait a little period of time. They, hey, we see you haven't— you just target the people that haven't used that particular new feature. We see you haven't used this in this period of time. We know you are, you know, a sales user of salesforce.com, right? We think it's important to you because of this. Let me show you how it works. I think that time delay that's combined with data that shows, hey, it's been announced, it hasn't been used, let's target those customers, important. You might then want to follow up. You know, we do a newsletter digest which talks about key new features. You know, that's another way to announce it for those people that haven't adopted it yet. And then finally, if it's— if you're seeing in particular accounts, say across the board, they aren't using it, when the customer success people reach out, say, uh, to do a conversation or a check-in, uh, or quarterly business review, whatever you happen to call them, it might be good to bring it up and make sure they're aware of it. So use all the channels you can, but biggest thing is just manage adoption, because you know if it is getting used and is getting used by the right people, then you don't really have to continue pushing it through other channels. And then one other piece of that data You know, when you're looking at adoption, if it's a complicated feature, say there's 6 or 7 steps, say it might be something like, you know, launching a new landing page that creates a campaign that's integrated in Salesforce inside of, you know, your marketing automation tool. You might just want— if you're that marketing automation product manager, you might want to see how people progress through that series of tasks and then guide your, your feature follow-on feature announcements and follow-on help based upon the patterns you're seeing in those paths.

And Hannah asks, what specific metrics are you looking at to, I guess, measure the impact of your feature announcements? Are you looking at specific numbers or is it more qualitative stuff you're looking at?

We do both. So we'll look at specific numbers, like if we see So say we have a finance segment and we push out a new feature, particularly for finance, we'll look at that particular segment of our customer and see how well they've adopted it. If we have a feature that we think is probably going to be used by, say, 1 or 2 of the users at a particular customer, say we have a customer that are 30 users and we know that every customer, you know, 1 or 2 people are going to use this feature, we'll look at account by account and make sure there's 1 or 2 people that are actually using the feature. And then we'll do things like surveys for feedback. NPS, we'll get a lot of that, that feedback that is more qualitative than it's just usage patterns.

And let's talk a little bit how Pendo helps here.

What's—

you're probably working towards an ideal situation in which feature announcements can be perfectly pulled off. So how does Pendo help you get to that point, and what, what maybe is missing? What are you hoping to achieve in the coming years?

Sure. So I mean, I think regardless of whether you use Pendo or something else or just do this all by hand, you know, it comes down to are your customers getting value out of the product you provide? Are they getting value out of the product as a whole and then specifically segments of the product and maybe features? So the big thing there is measuring that, looking at that data, creating segments in advance, setting goals that you expect reporting to whoever management happens to be, whether you report as a VP of product to the CEO or whether you're a product manager reporting to a VP of product, but providing that information and that visibility to the rest of the organization and then adjusting based upon what happens, what data you get. It's very, it's very important that, you know, the data and the tools you have, you use to adjust where you're going, where you're headed. You know, we had one customer that moved around a search box and then noticed that people didn't know where it was, so they just did a little highlight, you know, that they just showed to everyone once when they first logged in and didn't show it again. So frequency is another thing. If you're, if you're able to build a system or have a system like Pendo that can say, okay, show this new feature announcement only once to all new users, or show that, you know, 3 times once a week but don't show it again after that, there's there's differences you can set up. But the thing is, right, as every product person, you want to build a product we really love that gives them value, that helps them accomplish tasks. And the reason you roll out features is because you think they'll do their job better. So you just need to make sure they're aware of those features, they know how to use them, and they adopt them so that it accomplishes those goals.

So Kelsey Flanner asks, If you have multiple feature releases, have you found in your experience it's better to announce these over a series of smaller campaigns, or has it been as effective doing fewer campaigns?

So I, I think it depends on the mechanism you're using. It's great if you're using email. I think you can put a lot of information in the email as opposed to multiple emails. I think if you're doing things inside the application itself, it's probably a good idea to stage those over time, you know, because you don't want to overwhelm the user because they probably come in there to accomplish a specific task. And if the announcements and the information, the help and the guidance you're giving them distracts them from that task, they might just dismiss all of them and then miss them. So I would look at, you know, developing it as a cadence and trying to tie them into the process they're working with. You know, I mentioned if you're a marketing automation user and you're setting up a landing page, well, that's a great time as you're going through the process to say, hey, we added this new step. Now you don't have to go back and create your own mailing list. You can actually create it with this button right here. Mailing list creation was always one of my frustrations with marketing automation systems. Seems like you always had to have them first. So, you know, those types of things would be great if you can make them in context in the flow, you know, announce things as they're doing things. Like, you know, you create a new flow for creating staging servers. As they're going through that, you might just even have an eye icon that lets them pull up information about the new feature on their own. So you just don't want to overwhelm users. It's a, it's a balance, and you kind of get a feel for it as you do it more. And seek with users, see what they like about the guidance you provided, see what they didn't like about the guidance you provided. See what they like about the announcements you've made and how you've targeted those. It's always great to interact with your users anyways, right? All the product managers are always told, you know, get out of the office, meet users. So get feedback on how well your education process from announcements to contextual help to guidance is actually working for your users and use that data to adjust. And you can do things in-app too to get that data. Things like surveys, things like NPS are great for that. But I recommend also getting data by talking to them, talking to your users, talking to your customers. Great, great.

We do have time for another question or two, so you've been great. I think we've got 4 or 5, so do throw in a question. Even better, vote up one of the ones that are already there, and so we can get to the most favorite. But I did want to ask, the promise of this conversation was that feature announcements leads to happier customers. So that's the promise. So is that true? How is this so?

Yeah, I do think that's true. I mean, we live in a world that I think I mentioned before, the buyer's in control, right? The worst thing, one of the worst things I heard actually before I started Pendo, I was doing some consulting and I was talking with a client who had just lost an important customer and they were talking about some key features that they lost the customer to a competitor. Over. And I was saying, yeah, that's a bummer, you know, trying to be all empathetic because I was, I felt bad for them. And then they said, yeah, but that's not the worst part. The worst part is that two of those features we actually had, the customers just didn't know they were there, didn't know how to use them. So customer happiness, customer adoption, it's very important that customers know about your features, know how to use them to accomplish tasks, to perform their job better, it really does lead to happier customers. And you can measure that. You can go through and do things like NPS your product based upon, you know, putting a strong effort on customer education and announcement and guidance and see how that changes your NPS scores.

Excellent. I'm going to go to one more question here from the online audience. And I think this is kind of interesting because it ties pretty neatly into the way your software operates. Do you have any specific strategy or method for segmenting customers? For instance, do you do it by product or taxonomy, maybe demographics? What's the common approach to segmenting customers for feature announcements?

So I would answer that question a little bit differently. As a product manager, I didn't often— I often didn't know what I wanted to know. So I would— when I was working with engineers to do analytics and segmentation before, I think I know what I wanted. They would implement it for me, it would take a while, get it rolled out, I'd finally get data, and then I'd realize, well, it'd be really great if I segmented this differently. I think as you go about creating segments and learning things, you realize that There's things you want to see that you didn't think about. So in an ideal world, the best thing to do is capture everything. Capture all your data, every single thing a user does in your application, along with all the information about those individual users and accounts, right? So if you have everything, if you have this big package of data, and then you can create segments on the fly and say, okay, you know, what I think is really important is not finance segment, but specifically the banking customers we have in the finance segment. So show me how they're using the product. Or, you know, what's really important to me is show me all my users that have been active in the last month and whether they have a breadth usage, meaning are they using not only the analytics portions in Pendo's case, but also the NPS, the survey functionality, the guidance tools, right? Show me all of those people. So if you have all this data and you can on the fly create segments that are meaningful to you based upon things you learn from the data or from the other segments, that's what's really powerful. So I don't know that there's necessarily a, hey, we want to look at just this segment and here's the 8 segments we want to look at. But what's really powerful is if you can create those segments based upon the question you're currently trying to answer and adjust them based upon what you see out of the data itself. I think that's really kind of the big goal.

Excellent. So we have 2 people online, Will and Kip, great name, asking kind of similar questions. We're largely talking about an online environment where it's kind of easy to react and segment and deliver very pertinent messages. But what about offline software or desktop software? How do these practices align with that kind of product as opposed to something that's living online?

Sure, so that, I mean, that's definitely harder. And then I guess there's two different ways to look at it. If your offline product is able to connect to online and push data out and get updates, that's a great way to be able to do that, even if it's not an always-on kind of connection where you can think about instead of doing this in real time, you're doing this in batch. You know, that's one kind of solution to that. It's just having a connection mechanism where you can capture data, you can get that data back, you can then adjust, say, maybe guidance in your product based upon that. The other thing is just looking at it from, you know, when the next version does roll out, making the improvements based upon what you do learn. I think, you know, a lot of the reasons you see a lot of products moving to, you know, SaaS offerings is you do have this near real-time nature where you can really affect a customer or user's product experience immediately, if not immediately, really quickly. So there is a big benefit to that. But if you are in an environment that's offline or intermittently connected, you can do things like batching up and sharing data, pushing out guidance that way through product updates. And if it's even less connected than that, you know, then you have to think about it, do studies about how users are using your product, and use that to influence product direction in the future and also guidance in future releases of product. But it becomes a much trickier issue to deal with when you can't deal with things immediately.

Well, this has been great, Eric. Yeah, you've got terrific insight obviously from building software that is about feature announcements amongst a lot of other things. Before I kind of wrap this up, do you want to kind of close on any particular message? I know you've put into the chat stream there where you can be reached, but maybe you can reiterate that and tell us a little bit about where people might find you next.

Sure, sure. So I'll actually be— I'm not speaking, but I am attending the industry conference, so that's probably the next place that will be at. A little, little plug for you guys since I'm gonna be there. Second, you know, if I know there was more questions that popped through, if you have a question, feel free to email me. It's eric@pendo.io. Also happy to accept LinkedIn connections. I think I'm the only Eric Bodak in the software industry, if not one of few, so it'll be easy to find me. And then, you know, I occasionally tweet. So if you want to follow me, it's just Ivo, first initial, last name. I'm so happy to connect, happy to help people in any way. Would love to get, you know, feedback on what they thought of the presentation, what other areas we should cover. Would love to get feedback on what they think of Pendo. So feel free. I love to, love to chat with people, love to help, you know, other product managers create products that customers love, right? It's great passion. Everyone wants their product to be the best. So it's fun. Absolutely.

I'm sure everybody online is thinking that. And we're delighted that over 100 of you joined us live for this session. It's actually possible to see the session again by visiting the same URL. So I really greatly encourage you to share this with your colleagues if you found it useful, and then they can enjoy this conversation too. Our upcoming product launch on September 6th is with David Freyden, the author of Building Insanely Great Products. And so we'll be going through advice on building insanely great products. So you can't afford to miss it, really. So thank you very much for joining in on this product launch. Continue the conversation on Twitter, email, and our Slack, and we will see you next time. Thanks so much, Eric, for joining us.

Thanks for having me. Thank you.