Product Management Glossary: Key Terms and Their Definitions

The world of product management encounters an array of technical terms, phrases, and acronyms that can confuse even seasoned professionals in the product management realm. To aid both aspiring product managers and those who want to master their field, we’ve created this comprehensive glossary of fifty essential product management terms and their definitions to help you collaborate better with your colleagues and boost your knowledge. 

Glossary of Product Management Terms

A/B Testing

Products need to be tested before they are launched to the market. A/B testing is a form of experimenting with different versions of the product to gather feedback and compare the results. This form of testing is commonly used in software product development. 

Agile Coach

An Agile coach is a specialist in Agile methodologies who works closely with a company to help them adapt to the Agile product methodology. Large organizations that need to coordinate many teams will hire one or multiple Agile coaches to keep their operations on track as they adapt to different processes. 

Agile Manifesto     

The Agile Manifesto includes the guiding principles for Agile product development. The core of Agile product development is encouraging product teams to adopt flexibility, adaptability, and progress over the rigid structure of waterfall and stage-gate methodologies. With the increase of cyber-physical products, more and more companies (including manufacturers) are looking to implement agile product development or at least a customized hybrid to improve their development structures.      

Backlog

The backlog is a list of prioritized features, upgrades, and problems to fix in a product before launching. The product owner is responsible for managing the backlog and overseeing its progress. 

Beta Testing

Beta testing is a strategy that allows a limited group of users to test the product before the full launch. This allows a company to gather reviews and any feedback that might be valuable to know before the official product release. Beta testing can be used in both hardware and software development.

Champion

When you think of a “champion,” you think of someone who leads in a particular field or activity. In the world of product development, a champion is an advocate for the product within the organization. Their role is to bring customer feedback to the development teams and support the product manager to coordinate engineering teams to keep the product on track. 

Churn Rate

The churn rate for a product is the amount of customer attrition. How many customers purchase the product and don’t continue to become repeat customers? This metric is particularly valuable for products offered on a subscription basis.

Competitive Analysis

Creating a competitive analysis helps you evaluate how your product performs against rival products, how they position those products, and the strategy they’re using in the market. Companies that conduct a competitive analysis while doing product planning can better position their products to attract more customers in the market. 

Customer Development

Customer development is a four-step framework that helps companies understand their customer needs and gather valuable feedback. The four phases include:

• Discovering your customers.
• Validating your product meets their needs.
• Creating products that meet the needs of all your customers.
• Building up your company to match demand for your products.

Customer Journey

The customer journey in product manufacturing encompasses the entire experience a customer has, from awareness of the product, through research and purchase of that product , to usage and maintenance of that product and beyond. It's a holistic view of how a product fits into customers life, highlighting touch-points and opportunities to build loyalty and enhance brand perception.

Cyber Physical Products (CPP) 

Cyber-physical products (CPP) integrate digital software systems, allowing the product to connect to other devices or physical systems. The complexity of a cyber-physical product can range from a smart thermostat automatically regulating the temperature of your home based on your personal settings and connecting to an app on your phone or a completely automated manufacturing system.

Feature Creep

Adding a feature to your product should always be done with purpose and strategy. When a product team continuously adds features without focus or planning, this is called feature creep.

Feature Freeze

When the product team decides to focus on testing the product and stop adding new features, it’s called a feature freeze. This lets the product team know what to focus on and what ideas to put aside for later. 

Feature Prioritization

A product may have a long list of feature ideas that could make the product better. But do they align with the product vision? Do they offer value to the customer? How long will they take to create, and at what cost? Feature prioritization is the process of sorting through feature ideas and making a prioritized list based on factors that are important to your company. No matter what method you use for prioritization, the process is essential to avoid investing in customer wants rather than customer needs that will help sell your product. 

Innovation Funnel

Managing ideas for new products and product improvement can be complex and overwhelming. An innovation funnel is a process that helps product development teams manage the stages of innovation from idea to final product. With an innovation funnel, your team can keep the ideas flowing while screening the viable ones to ensure only the most fruitful ideas are approved. 

KPI (Key Performance Indicator)

Key Performance Indicators, or KPIs, are the metrics used to evaluate the success of a product. Setting KPIs is essential to know how a product performs in the market. Establishing goals, tracking results, and knowing what to measure helps companies increase the success of their products. A great place to monitor and track these KPIs is on the product roadmap so all stakeholders can see the stats in real time. 

Lean Product Development

Lean product development focuses on minimizing waste in the product development process. Lean product development focuses on delivering value to customers, reducing the timelines of development, creating an MVP vs. a full-scope prototype, testing and gathering feedback, and eliminating inefficiencies where possible. 

Market Opportunity Analysis

When companies look to expand their market reach, they need to examine the potential markets where their products can be successful. The process of identifying and evaluating potential markets is called market opportunity analysis. Companies will often deploy a segmentation strategy in order to break into the markets they identify as offering revenue potential. 

Market Research

Market research is when product teams gather information about the market's needs, customer preferences, and the activities of competitors. Conducting market research helps inform product teams in their own planning and prioritization.

Market Segmentation

Market segmentation is when you divide a market into distinct customer groups or segments. There are four main ways to segment a market based on different criteria: demographics, geographics, psychographics, and behavioral. Companies can use all four segments or pick and choose the segments that make the most sense for their products and customer base. 

Market Share

The proportion of the sales your product gets in each market is called the market share. Calculating, tracking, and assessing the market share of your products is a key metric you should include on your product roadmaps. Each time a new feature is approved, you can see how that feature improves your market share and make informed decisions on the next steps, regardless of the outcome. 

Milestones

Your milestones are the significant achievements or events in your product development process. Plotting milestones on your roadmap helps your teams stay on track and ensure the product is ready to launch on time. If complications arise, you can quickly assess your milestones to see if anything needs to change in order to launch on time. 

Minimum Viable Product (MVP)

The minimum viable product is the simplest iteration of a product that can be developed in order to test and gather feedback. The MVP is a cornerstone strategy of Lean-Agile methodologies, which emphasize creating and testing through iterations rather than waiting until the final prototype is built before testing. With an MVP, corrections, and adjustments can be made sooner, saving time and money in the overall product development process. 

Persona

A persona is a fictional representation of an ideal customer. Creating user personas is useful for product development teams to ensure they prioritize the features that matter most to the target market. User personas are also valuable for marketing teams to tailor their messaging to the right end customer.

Pivot

A pivot is a fundamental change in a product’s strategy. Pivots are made when certain factors change that are beyond anyone’s control or prediction. For example, a company may need to pivot if there is a shortage of materials or disruptions in the supply chain. They might also need to pivot if the market demand is influenced in another direction or a regulatory shift occurs. Agile product development methods make it easier to pivot product plans. 

Product Backlog Grooming

Product backlog grooming or product backlog management is the process of reviewing and refining the backlog for each product. The product manager, the product owner, and other key team members do this task. The goal is to ensure the right tasks are prioritized according to organizational goals and the product strategy. 

Product Backlog Item (PBI)

An item or product feature that is sitting in the product backlog is called a PBI or product backlog item. Product backlog items include detailed information and action tasks for the development teams to work on and complete. These items are approved by the product development teams and have been assigned priority for completion.

Product Designer or Product Design Engineer 

Job of a product designer also referred to as product design engineer is to transforms ideas into tangible realities. A product designer or engineer bridges the gap between user needs and manufacturability and crafts functional, beautiful products through research, sketching, prototyping, and collaboration with engineers, Optimizing for both user delight and production efficiency.

Product Development Lifecycle

The product development lifecycle covers the essential stages involved in developing products, from the idea or concept for a product to the design and engineering to the product's launch and continuous improvements afterward. Depending on your product development methodology, the exact stages may vary. However, the overarching concept is that product management covers each product throughout its lifecycle until it is eventually replaced by a new model and phased out. 

Product Differentiation

Companies want their products to stand apart from their competitors. This requires having a strategy to ensure product differentiation and a marketing plan to communicate this difference. Knowing what makes your products unique and helping customers understand this can increase sales and market share. 

Product Lifecycle

The product lifecycle follows the stages that a product goes through, from the introduction to the market, followed by growth, then maturity, and finally, a decline. Products can extend the lifecycle when product teams continuously introduce new features and iterations that benefit the customers, meet their needs, and improve the appeal. 

Product Lifecycle Costing

Products have a certain lifecycle from the idea phase to the launch. That lifecycle has a cost. Product lifecycle costing involves estimating the cost of a product over its entire lifecycle. Knowing the cost of the product helps inform development teams and stakeholders with relevant information, such as where and how to possibly reduce those costs and how to price the final product. 

Product Life Extension

Products have a natural life cycle unless a company invests time and strategy into prolonging that lifecycle by adding new features or redesigning the model. When a company knows a product is coming to the end of its life cycle and deliberately intervenes to prevent the product from becoming obsolete or phased out, that is called product life extension.

Product Manager

The product manager is a professional who is responsible for the overall success of a product or product line. Product managers work with a team of different players to ensure top success for the products they oversee and typically have a multi-disciplinary background of experience. You can learn more about what a product manager does in detail in our article about this important role. 

Product-Market Expansion

Product-market expansion is the process of creating a strategy to enter new markets and reach new customer segments with certain products or product lines. Expanding into different markets creates opportunities to generate more revenue, launch additional product lines, and capture market share from the competition. 

Product-Market Fit

Many successful products are created to fulfill a need in the market. When product teams specifically look at the market’s needs and align their product to that need, it’s called product-market fit.

Product-Market Matrix

The product-market matrix, also called the Ansoff Matrix, and sometimes also referred to just as product matrix, is a four-quadrant tool used to make strategic decisions on products and the markets they’re sold in. The four quadrants include market penetration, product development, market development, and diversification. Each quadrant comes with different levels of risk and opportunity. 

Product Owner (PO)

The term “product owner” comes from Agile methodologies. Their primary role is to ensure that the short-term goals of both the product and the company are met. This involved managing the product backlog and educating development teams, so they have a clear understanding of what should be built and when. Successful product ownership helps products launch on schedule. While product management and product ownership have some overlapping goals, their jobs are distinct.

Product Portfolio

Your product portfolio is the complete collection of products or services your company offers. This can include your existing products as well as the ones in development. A product portfolio can have one or multiple product lines in different markets. Effectively managing your product portfolio requires transparency, efficient communication, and the right tools. 

Product Strategy

The product strategy is a high-level plan for achieving product goals. The best way to communicate that strategy is by using your product roadmap. Defining the scope of the product, setting milestones, and coordinating with stakeholders help drive the product strategy forward and make it successful. 

Product Vision

The product vision is your long-term plan for the product. Having a clear vision and sharing it on your product roadmap makes it easier for your teams to create the desired results for the product. Your product vision should align with your company's goals and adapt to market conditions, innovation, and feedback changes. 

Roadmap

Roadmaps are documents that outline the steps needed to achieve a goal. In product development, the product roadmap tracks the vision for the product along with the milestones and essential components required to create the product. Other departments have their own roadmaps to follow to keep them aligned with the overarching purpose. 

ROI (Return on Investment)

The ROI, or Return on Investment, measures how profitable something is compared to the investment. Product management teams will study the ROI of their products for the customers who are most likely to buy them. Product teams will also examine the ROI of product initiatives to determine if a new feature or product is worth developing.

Scrum

Scrum is a type of project management system commonly used with Agile frameworks in product development. The scrum is characterized by splitting tasks into small sections to be completed in short time frames. The person who oversees the work done within this system is known as the Scrum Master. 

Sprint

A sprint is a fixed period of time in Agile development methodology. Sprints are commonly used in Scrum project strategies to accomplish tasks in a set, short timeframe. 

Stakeholder

A stakeholder includes any individual or group that has an interest in the product's success. Product managers are required to consult with and incorporate feedback from stakeholders on the product to ensure the best possible version is created. Stakeholders include lead engineers, sales teams, marketing teams, executives, investors, or other partners in the product development process. 

SWOT Analysis

A SWOT analysis is a process that helps determine the viability of an idea by looking at its Strengths, Weaknesses, Opportunities, and Threats. Proposed ideas that receive a high score on this scale are usually approved to move forward. SWOT is a method often used with Stage-Gate methodology in product development.

User Acceptance Testing (UAT)

User Acceptance Testing, or UAT, is a process typically used in software development. The purpose of UAT is to assess how users interact with the product and make any adjustments, fixes, or improvements before the official launch happens. 

User Experience (UX)

Having a product that works great is important. It's also vital to have a product that users love to interact with. Most product teams will have a user experience or UX team working to make their product user-friendly. This portion is vital for success because when customers are frustrated while using a product or cannot easily learn how to use it, they will stop buying it. 

User Interface (UI)

The user interface is the portion of a product’s design and layout that the customer comes in contact with. This includes both visual and tactile elements, depending on whether the product includes hardware, software, or cyber-physical. Your User Experience or UX team will be directly involved in creating and testing the user interface.  

User Story

The User Story is a snippet of a story that describes a product’s features from the perspective of the customer. User stories are central to Agile methodologies because they break down the product development process into smaller tasks. A basic example of a User Story formula looks like this: (Description of User) + (What they Want) + (The Benefit they Get).

Usability Testing

Testing a product both at the minimum viable stage and at the final iteration is essential to ensure it meets the needs of the target customer. Usability testing is the evaluation of a product's user-friendliness. A product that looks great is no good if the customer doesn't know how to use it or is frustrated while using it. Usability testing can also help product teams make any fine-tune adjustments before launching. 

Value Proposition

How do you know if your customers want or find value in your product? You analyze the value proposition of that product. The value proposition is the unique value you offer customers through that product and its features. Knowing your customer well will help you create successful value propositions that align with customer needs and wants. 

Your Go-To Place for Product Development Knowledge

This glossary serves as a comprehensive guide to understanding some of the most commonly used terms in product management. While this list is not exhaustive, the terms cover product management, product planning, ideation, launching, and beyond. Whether you’re new to the industry or want to brush up on some of the newer terms, we’ve got you covered. You can also subscribe to our blog for more articles on the latest news, concepts, and thought leadership in the world of product development. 

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