Your go-to resource for acronyms, jargons, terminology, and useful words for product and customer experience teams.


Behavioral Product Management

What is Behavioral Product Management?

Behavioral product management is a method of product design that takes into account human psychology and behavioral science.

Behavioral product managers take into account that people make irrational decisions when planning their products. They use psychological research to build products around those irrationalities, and they also use psychological principles to guide customers to the behaviors that the PMs wish them to take.

This approach allows PMs to create products that account for human psychology, which can lead to more successful products.

How Does Behavioral Product Management Work?

Behavioral product management is an extension of the traditional methods that all PMs use to try and create successful products. They base their understanding of what motivates customers on things like customer feedback in order to get a better grasp of what they need, want, hope for, or are afraid of. 

However, where behavioral product managers differ is in their understanding that humans can be irrational beings. We don’t always know our reasons for acting or believing a certain way. The context of a situation can alter our opinions, and this can lead customer feedback to being inaccurate.

Behavioral product managers rely less on what users say in customer interviews and instead take a proactive approach based on their understanding of human psychology to guide and even change user behavior. With this unique insight into their users, behavioral product managers are able to build products that resonate.

Behavioral product management is a unique approach that combines product management skills with behavioral science. This combination can help organizations create more satisfying customer experiences.

How Does Behavioral Analytics Differ from Other Business Data?

Product teams can learn a lot about their target user groups by asking questions and conducting research using surveys, focus groups, and customer interviews. However, it’s important to keep in mind that people’s behavior may not always match up with what they say they would do. This is where behavioral analytics comes in. By studying how people actually interact with a product prototype, teams can get a better understanding of what features will be most used and valued.

Relying on customers’ self-reporting can lead to inaccurate conclusions, as seen with a hilarious survey the commercial airlines conducted every few years. The question asked was:

If you could choose one in-flight snack, would you prefer a healthy option, such as a plate of fruit, or a piece of cake

As we summarized in the blog: “In survey after survey, the passengers overwhelmingly say they’d rather have the fruit. But when flight attendants roll a real cart down a real aisle on a real flight, an overwhelming majority of passengers ask for the cake.”

This goes to show that people do not always know what they want or what is best for them. It is important to take self-reported surveys with a grain of salt.

Behavioral analytics can help you understand your customers in a way that they might not even be aware of themselves. This type of data can help you discover things about your product’s customers that can be invaluable to your business.

What Types of Behavioral Analytics Do Product Managers Use?

Product managers can gain insightful and valuable information by analyzing a wide range of user behaviors within their products. Some common examples are listed below with an explanation of how they can help you refine and improve your products.

The user’s journey through your product is important to track and analyze. Your company’s product and development teams might have an idea about how to set up the product interface, but when you ask customers for their opinion on the intuitiveness of the interface, they might have different ideas. Even those ideas might not reflect how users will actually navigate the product when they start using it every day. Monitoring and analyzing user behavior is one valuable way to understand how people use your product.

Confusing user paths can be a big problem for any product – if users can’t figure out how to do something or get frustrated trying to complete a task, they’re likely to just give up and look for a different solution. This not only results in the loss of that customer but also contributes to a decline in morale among your other users.

There are a few ways to combat this issue:

Use data from your analytics tool to identify which areas of the product are causing the most confusion for users.

Provide in-app guidance or tutorials for specific tasks that might be confusing.

Make it easy for users to get in touch with customer support if they’re having trouble.

Ensuring that your product is easy to use is essential for keeping customers happy and engaged.

Monitoring your product’s usage and common areas where users stop engaging with your product could identify possible issues or hurdles within your app. These behavioral analytics allow you as the product manager to gain valuable insights into how users interact with your product and where they might encounter difficulties. As a result, you can make the necessary changes to improve user experience and keep them engaged with your app.

Examples of Behavioral Product Management

When it comes to pricing your products, it’s important to keep in mind the psychology of pricing. Research has shown that when customers are presented with two pricing options for a product side-by-side, the overall sales for that product increase. Some customers see the lower-priced option as a bargain, while others see the more expensive option as having more value or being more prestigious.

Automating decisions can be a great way to make your product more appealing to users, as it eliminates the need for them to perform mundane tasks that they may find frustrating. As an example, many apps offer a “Stay logged in” option which allows users to bypass the sign-in process for each session, making it easier and quicker for them to get started with using the product. As a behavioral product manager, you can use this knowledge to make similar decisions in your own products to improve the user experience.

Behavioral PMs understand that people can feel overwhelmed by too many choices, and use this knowledge to give their users fewer options during each stage of the product’s interface. For example, a software app will offer a collapsed toolbar on its home page, with only the most commonly used actions accessible. By doing this, the product’s interface appears calm and welcoming to the user, rather than overwhelming.