Why PMs should be responsible for revenue metrics

As a product manager, I know that tying the product team’s performance to revenue goals can be controversial. Some people argue that product metrics (and only product metrics) should be the guiding star—anything else will dilute the product’s value and ultimately harm your company.

I disagree. 

When PMs focus only on product performance metrics like feature adoption and number of users, the temptation is to hop from one project to the next without sticking around to see how that product performs in the market and listening to early adopters keenly. Revenue is left entirely in the hands of the GTM (go-to-market) team. 

When the product hits revenue goals, that strategy works fine. But if it doesn’t meet its targets, there’s only so much the GTM team can do. GTM can’t make tweaks to the product that will bring in more revenue. 

When PMs build a product or feature, they should go beyond product metrics and be responsible for associated revenue as well for some time after launch.

Here’s what that looks like in practice. 

First, I want to clarify one thing: I’m not saying that PMs should own all revenue. The product team doesn’t have control over all revenue, so holding us accountable for it wouldn’t make sense either. 

But I do think that PMs should own special revenue tied to the features or products they build, at least for the first year, before they transition the responsibility completely to sales and the GTM team. 

Product managers know the value proposition of what they’ve built better than anybody. When a product manager pitches a new feature they include a projection of how many users will adopt it and the impact it will have on driving revenue. The value of the product is part of their vision and revenue projections are part of the proposal to put this project on the roadmap. 

But, in spite of this, PMs rarely stay involved once adoption goals and other product targets have been reached. Generating revenue is left to sales and marketing. 

If PMs only care about product metrics, they’ll build a product that is technically good, sure. But if users aren’t willing to pay for it (and become customers), it might be good, but it isn’t valuable. At least, not valuable enough for people to be willing to pay for it.

"Product managers know the value proposition of what they’ve built better than anybody... The value of the product is part of their vision and revenue projections are part of the proposal to put this project on the roadmap." 

When PMs jump from one project to the next without optimizing those products to meet revenue goals, the company will run into the same problems again and again. This process creates debt without value. 

The real magic happens when product and GTM teams work together. Here’s what that looks like. 

In the first few quarters after a product or feature launches (after beta testing), PMs own revenue goals with the GTM team. 

They sit in on sales calls to hear customer objections. They partner with GTM to figure out if the messaging needs to be refined or if it’s the product itself that needs to be updated. They iterate. 

Relatively small changes like tweaking the UX or adding a gated approach can make all the difference. Having the PMs participate in those discussions with customers can help them figure out what to add to make the product more valuable. 

In my experience, making changes that drive revenue is not a heavy lift. But those changes at times need to be made in the product, not always on the go-to-market strategy—and without them, the product isn’t valuable enough for customers to purchase.

If some of this seems counterintuitive, or like we’re putting too much on PMs, here’s something to consider: The market is shifting in this direction already. In recent years, more companies have begun hiring growth PMs, who are responsible for exactly this. And also more PMs are being asked to think of overall positioning and value messaging right at the project proposal stage. 

Here at Mixpanel, we believe that PMs should own revenue goals, and we practice what we preach. 

When we built Mixpanel Marketing Analytics, the beta phase went very well. From a technical standpoint, users loved the product and were excited about it. But when it came to monetization, we hit a roadblock. Despite building a good product, we weren’t able to meet our revenue goals at first. 

We realized that small changes like adding out-of-the-box channel definitions, auto-tracking for page views, and our Web Analytics template could provide a lot of value and create an incentive for users to purchase or expand their current Mixpanel plans. By giving ownership of revenue to PMs (in addition to sales), we were able to foster cross-team collaboration and work together to improve not just our go-to-market strategy but our core product, as well. If PMs hadn’t been responsible for hitting revenue targets, they would have simply moved on to building the next thing, and that collaboration never would have happened. 

Now, we use this strategy for any new features and products we build. 

When our PMs started owning and tracking revenue, we soon noticed something that should have been obvious earlier. Mixpanel wasn’t great for tracking revenue metrics. 

We could easily see product metrics like user adoption and account adoption, but we didn’t have any way to tie that to revenue impact. Instead, we had to run SQL queries and spend weeks trying to tie those numbers together. We couldn’t analyze revenue metrics with Mixpanel. There was a gap in our product. 

It was a wake-up call. 

We needed to be able to show the impact that product changes/updates have on revenue, without jumping through all of these hoops. That’s why we built Mixpanel Revenue Analytics.

Seeing that gap helped us identify the use cases and build revenue analytics features that would be useful for our clients—and for our own PMs, too. Now, we can measure the impact of our product initiatives in one place. 

With the launch of Revenue Analytics, our PMs will own revenue, at least for the first year. And now, they can track those results directly in Mixpanel.