Software as a service (SaaS) is a sector that’s growing by 18% every year. In this market, SaaS companies are under constant pressure to innovate and roll out product features that give them an edge over their competitors. But the development of new features must be well planned and strategic — a haphazard rollout can be disastrous. So how are you, the product team, supposed to determine your product needs, roll out new features, and measure success?
It’s not easy, but we’ve talked with the best of the best to get an idea of what’s worked for them and what hasn’t. Stay tuned till the end of the post to see what our experts had to say!
What Are Product Features?
A product feature is an attribute that distinguishes one product from another and offers value to the end user. Some SaaS product features examples include:
- File storage
- Analytics
- Onboarding and support
- Integrations
- Number of seats
When comparing similar software, decision-makers will evaluate whether the features of a product justify the cost. They may also be comparing service levels, as the majority of SaaS companies offer tiered pricing, with full features available only in premium or enterprise-level plans.
Product Features vs. Product Benefits
Product features are attributes; product benefits are how the features solve problems. For example, “Detailed customer analytics” would be a feature that offers these possible benefits:
- Ability to see how customers are engaging with software
- Insights into churn rates and customer stickiness
- Metrics on webpage visits and engagement
In developing new product features, the best approach is to start with the benefits — the problems you’re trying to solve, as well as the number of customers who would benefit.
How Do SaaS Companies Choose New Features?
Different team members and departments may have convergent ideas about which new features would be most useful for customers. One way to keep discussions moving forward is to use a project management platform that allows teams to brainstorm ideas, rank them by urgency, and preserve lower-priority ideas for future discussion.
To kick off a discussion about potential new product features, consider the following:
One-off requests
If a customer requests a specific feature, consider whether that feature might be helpful for other customers, too.
Support tickets
Customer support tickets, real-time chat discussions, and support phone calls can help SaaS companies identify shortcomings with their software, as well as features that could be useful.
Impact-effort matrix
Teams that have come up with a list of possible features can use an impact-effort matrix to sort them into four quadrants. The ideal feature would have a high value for users and require little effort to implement.
Weighted rubrics
A rubric is similar to an impact-effort matrix, but more detailed. Teams can create a rubric with “scores” for each agreed-upon factor, such as whether a feature would: work
- Contribute to monthly recurring revenue (MRR)
- Motivate customers to upgrade to a higher service level
- Benefit the majority of existing customers
A rubric takes some time to develop, but it can greatly accelerate the decision-making process.
Market research
Market research is an ongoing process — or at least it should be. Relying on outdated market research (especially if it predates the global pandemic) won’t help SaaS companies understand what their customers need now. Market research helps companies make informed decisions about new product features.
Heatmaps
UX designers often use heatmap tools to determine how users interact with website content, but heatmaps can also help SaaS companies see how their customers interact with their product. For example, if heatmaps reveal that customers are routinely clicking on a “Help” tab, that might indicate the software could benefit from some in-app instructional prompts.
Customer journey
Similar to using heatmaps, monitoring the customer journey may reveal opportunities for new features. For example, customers may be using “workarounds” within a software platform that indicate a need for better functionality.
Competitor analysis
Keeping tabs on the competition is always wise, especially if SaaS companies can learn from their competitors. A formal SWOT analysis, monitoring competitors’ social media, or just signing up for a free trial are methods companies can use to get competitor insights.
How Do SaaS Companies Announce New Product Features?
New features are only useful if your customers know about them, so promotion needs to be a part of your feature development strategy. Consider the following:
Choose target users
Some features may be available only for certain service levels. Obviously, you’d want to notify anyone who will have access to the new feature, but you might also want to let lower-tier customers know about it, too. A new feature might be incentive enough for a customer to upgrade their service.
Send email announcements
An email announcement is a good way to announce a feature that fundamentally changes how users interact with a software platform. In an email, you can explain the update, share links to additional resources, and promote any opportunities for training.
Create in-app announcements
For the people who are “in the trenches” every day, an in-app announcement may be the easiest way to grab their attention. For example, a notification or popup could let a busy user know that a new feature is coming soon or is available.
How Do SaaS Companies Roll Out New Features?
Depending on the complexity of a new product feature, it may need to be introduced gradually. These are the most common approaches for rolling out a new feature:
Limited rollout with testing
- Alpha/employee-only release — An internal, employee-only release helps uncover any bugs or functionality problems. With this type of release, the goal should be to actively try to “break” the new feature or to use the software in an unexpected way.
- Beta release — This type of release involves one or more groups of customers that share attributes, such as people who use a specific operating system or work in a certain industry. These users may be unaware that they’re in a beta-testing group.
- Invitation-only release — Users included in an invitation-only release tend to be longtime, engaged customers. Unlike beta release groups, invitation-only users know they are getting a sneak peek at a new feature that’s not yet available to others.
Gradual rollout
Companies with a smaller customer base may prefer a gradual rollout, wherein a feature is released to a certain percentage of users, then expanded. The benefit of a gradual rollout is that it gives support teams the capacity to handle onboarding inquiries, and it may reduce the load on servers that can come with a full rollout.
Full rollout
A full rollout may be necessary for a number of reasons, and especially so if it’s tied to a marketing campaign. For example, if a SaaS company is touting a new feature on social media, all existing customers should have access to that feature.
How Do SaaS Companies Gauge the Success of New Product Features?
Many of the methods used to choose new features — heatmaps and customer journey monitoring, specifically — can help companies see whether new features are successful.
To measure feature adoption, companies can look at:
- Exposure — This is the percentage of users who have viewed the feature where it is presented (such as a landing page or an in-app announcement).
- Activation — This step won’t be included with all rollouts, only for those that require some type of activation.
- Usage — Activation alone may not indicate whether a user is engaging with a new feature. For example, activating a feature may trigger a short tutorial, and using the feature would be the next step.
- Repeat usage — This is an important metric, because it tells you whether users truly find value in a new feature. If they use it more than once, that’s a good indicator that a new feature is solving a problem.
Don’t forget about the importance of requesting feedback — by phone, by email, or within the app. Let users assign a star-rating to a new feature, or consider starting chat conversations to gather customer feedback.
How to Manage Your New Feature Rollout
Are you thinking about rolling out a new product feature? Parlor helps you gather the feedback and intelligence you need to manage this process.
Parlor’s analytics show you who’s adopted the new feature, and who has low engagement. You can use Parlor to easily set up in-app feedback tools, chat with customers, and monitor support requests. With Parlor, you get a complete view of your customer satisfaction and churn rates, so you can make the best decisions about attracting and retaining customers.
16 Experts Discuss How to Select and Prioritize New Product Features
Ready to see what 16 SaaS executives said about new product features? Check out their full length responses below!
Jonathan Moss
We conduct Product Market fit surveys as well as ongoing Discovery calls with customers to understand where we can add more value for our customers. The surveys provide a quantitative input and the Discovery calls give us qualitative indicators as well.
We try to balance a pragmatic approach with small scale experiments that add value to our customer experience, and we keep a very close relationship with our customers to make sure we are adding value and helping them solve real problems they face on a day to day basis.
Jói Sigurdsson
Our customer support channels are a goldmine for understanding how our product is used, what matters most to our heaviest users, and what may be missing to enable new use cases or empower salespeople in new verticals. Be it email tickets, real-time chat or customer support phone calls, everybody on our product development and executive teams regularly takes stints handling support so that they get direct exposure to customer problems and requests, and we are also able to mine our text-based systems to understand whether a given problem is common or infrequent.
Anthony Welgemoed
Sources of new features:
- Customer requests are all logged. If a customer has multiple requests we would ask them to rank the features in priority order.
- Feature requests from prospects are also captured and any overlapping requests with customers are added to increase their potential priority.
- The product team work on quarterly and sprint (2 weeks) based roadmaps.
-- Quarterly roadmap is determined and set at the start of each quarter and considers the epics the team is looking to deliver in that timeframe.
--The product team then meet on a weekly basis to discuss the progress of those epics. The team then go to the next level of user stories (features) and them for the next sprint.
-- Customer requests are discussed as part of this weekly meeting and if the team votes to include a feature request in an upcoming sprint, they are refined, estimated and ranked along with the other features. As part of the vote the number of times a feature is requested plays a vital role.
Features have to be part of the business' core strategy and the feature also has to be capable of being used by other customers.
Metrics:
- The process to consider and prioritize feature requests is kept very simple and the number of times it has been requested plays a vital role.
- The next factor is the feature's value added to the core strategy of the product. This is more of a qualitative metric.
Blaine Bertsch
We use a combination of user interviews and analytics to identify needs, followed by an analysis and prediction of the expected outcomes. Revenue and user growth is always prioritized in new development.
We use simple, rapid user testing on prototypes before we move ahead with a sprint and we also predict the technical challenge and timelines to make the ‘close calls’ on priority. Everything in our roadmap is challenged, deliberate and ties to an expected outcome that will drive our growth.
Aleksandra Mitroshkina
We use three data sources for new product features: Voice of the Customer, customer development interviews/surveys and market data.
Most often, as enterprise Customer asks for a specific feature - we start with a quick prototype for them and simultaneously survey the rest of the customer base to see if there is a demand for a big rollout. We usually find additional insights with a more extensive data set and transform the prototype to fit both the client who initially asked for the feature and the rest of the customer base.
Brett Webb
Our company has the enviable challenge that there are more opportunities to bring value to our customers than there are resources and time. Because of this, we diligently analyze the data and facts of what is the right next bet to bring value to our customers in the form of a new product feature.
Our product strategy is founded in our business strategy. Our first step is to understand the opportunities that we want to target as a company. We assess the market by using data on how customers are using our platform, what customers are telling us (NPS, CSAT, customer interviews, etc.), and analyze trends in the industry. We also analyze potential users who are not on our platform to identify untapped opportunities.
We select the next product feature by identifying the largest opportunity with the greatest impact. We follow our product lifecycle to incept a small chunk of value to understand if we are solving the right problem with the right solution as quickly as possible (fail fast and fail early). With that, we create hypotheses to test and validate our assumptions. We set metrics that can encompass some or all areas such as adoption, usage, satisfaction, and efficiency. Then we begin an iterative delivery approach and move to the next iteration when we have hit our target thresholds.
Our biggest win is being deliberate in the approach on how we get the feedback and data to measure our bet – be it surveys, interviews, or usage so we can make the right next decision for our customers and the business.
John Doherty
At Credo, we prioritize features based off a spreadsheet rubric we created based off coaching from our coach. It has a set of weighted values (the individual feature is scored 1-10 but we avoid 7 as it's a non-answer) and a final sum, and we work from top to bottom (most to least impactful, basically).
The spreadsheet contains things like how big the market is for the feature, whether it will result in expansion revenue, whether it will increase MRR, if development is required, if more staff will be required, and a few more.
Élodie Mouillet
At DashThis, we consider that in order to prioritize the right features to develop in our product, the first thing we need to do is to collect the feedback clients from our clients, and make sure nothing is lost!
That's why we use our CRM, Hubspot, as a way to also collect feedback through each email that is sent to us. Each ticket is considered as a feedback. But there can be a wide variety of feedbacks from positive to negative. To rightfully classify our feedback, we differentiate "New features" from "Needs of assistance", or even from "Pricing questions". This way, we know exactly which type of projects we're looking at.
When trying to prioritize, most of the time, we use the Impact-Effort matrix to make choices.
The Impact of a feature is measured through the number of feedbacks collected, the value of the clients who asked for it, but also the market opportunity that this feature represents. Sometimes, we see big opportunities in terms of sales acquisition or in reducing our churn, even if the feature is not the most requested one.
Eventually, we try to get a feeling on the value of the feature.
On the other hand, the Effort is measured with the development team through different workshops where we try to draw a big picture of the project and its limitations. We specify the first requirements of the feature, and the kind of behaviour we want in our app. We discuss limitations around it and the complexity of the project.
Eventually, we try to evaluate it with a Fibonacci sequence scale.
At the end, we end up with a matrix Impact-Effort full of ideas and features. We prioritize those that are located at the top of the scale, bringing a big impact to the product.
Paige Arnof-Fenn
I started my career in Brand Management at Procter & Gamble and at P&G everything starts with Market Research. They drill into you the importance of customer data to make decisions. It does not matter what you, your friends and family like (who may only tell you what they think you want to hear so they don't hurt your feelings). It is all about your target audience and what motivates them to purchase.
Market research is more important now than ever! Whatever we thought we knew or understood before Covid about our customers and market must now be checked because the world has changed so much since last March. Before you make product feature decisions you need to conduct market research! When real customers are willing to pay real money for your product you have a real business.
Start with the fundamentals: Who are you and why should anyone care? If you're not passionate about what you're doing, then why should anyone else be? There's a lot of noise in every category, so if you don't have a unique story to tell and a new approach or idea that excites you, then go no further. Every great business is built on a great story so start telling yours to potential customers and see if they buy what you're selling.
Sugandh Sharma
Selecting and prioritizing product features is done by keeping certain elements in mind.
For starters, the user feedback and behavior are monitored to identify which features or improvements customers request most often. We go beyond just listening to what customers say and actually see how they interact with our product.
Furthermore, the value of the new feature is also assessed against the level of complexity that it brings in. The product features should add value to the customers, be beneficial for the organization, and outweigh the complexities of implementation by a significant margin.
When it comes to the data sources, several useful ones contribute to a new product feature addition in the roadmap.
Data sources like industry experts and industry analysts are some of the most credible as they give a much better perspective about the industry and the prevailing trends. The experts and the researchers have spent years gathering and analyzing industry data to know what’s right and get to a valid conclusion.
Competitors also act as a highly crucial data source. If our new product feature already has competition in the market, their market research and data will tell us how the product feature will perform in the given market.
Also, metrics like product usage and adoption, number of prospective customers, cost to acquire new customers, and cost of implementing product features are the most important ones that are considered before making a final decision.
Aaron Kiyaani-McClary
We use a couple different key analytics: Product adoption, user growth rate, customer feedback, market trends, attrition rate, churn, and competitive analysis, to name a few.
Lauren Locke-Paddon
There is delicate balance of inputs that determine how we select and prioritize new features for Vocal Video. In our experience, taking into account what customers are asking for is incredibly important, as guessing what customers *need* that they've thought to ask for that will deliver the maximum return on their investment. We keep a running list of categorized requests from customers that we review regularly and always review during product planning conversations. We prioritize customer requests that will benefit the greatest number of customers first.
In order to make our best guess as to what our customers need most, but haven't thought to ask for, we evaluate our customers' usage of the software. In our case, tracking public usage of the videos our customers create with our platform tells us what kind of content and videos they value most, which means that we can discuss how to make this faster, easier, and better from a product perspective.
We are also able to track the customer journey through 'a-ha moments' on the back end with our own internal system, and use this data to prioritize work on the product that enable customers to hit those milestones faster.
Brett Casey
We do extensive research when releasing new products to make sure that they have the highest chance of success. We use heat maps to determine where opportunities may lie, customer feedback, and are constantly working with other carriers we represent to stay as far in front of the trend as we can.
The last couple years have seen plenty of product advancement in order to be convenient for the client and allow for the capability of remote sales. Things change fast, being flexible and willing to jump on an opportunity in a timely manner are more important than ever right now.
Adam Hempenstall
We take a look at how often a certain feature request comes up and what kind of users it comes from. There are lots of data points to consider but these two are the most important. If something comes up often, it needs our attention.
And if it comes up often by our most valued customers, then it needs even more of our attention. You really have to think carefully about what to prioritize, and for us it’s these two factors that influence our decisions.
Will Cannon
The process for selecting new features is different for each company. Some companies carefully analyze data that correlates with customer happiness and retention rates to find the best fit for their customers. Other companies look at feedback from customers to choose which ones they will build next. There are several factors involved in this decision-making process, but one of the most important criteria for us is how much impact a new feature will have on the user experience. The more value it adds to the customer, the higher up its priority goes.
For example, suppose that Company ABC has found through customer analytics that users are neither satisfied nor unsatisfied with their current e-commerce product for booking flights. They could improve this by adding features such as a "price tracker", which would allow users to monitor the price of flights over time. Company ABC could also use customer feedback to decide that a feature to help users manage their frequent flier miles would be a good addition.
Considering how well a new feature will improve things for customers greatly affects whether it makes it onto the roadmap or not, but it's also necessary to take into consideration how long it will take to build. Some features might be too difficult to code, or require the help of partners to accomplish. When deciding which new features need to be built for customers, companies must consider how much work is involved and if that feature has enough value to be prioritized over other projects.
