Product manager core competencies

Product management is a complex and multi-disciplinary field that requires a wide range of skills and competencies. To successfully implement gamification strategies, product managers must have a deep understanding of the core competencies and elite skills that are required to develop, launch, and manage successful products. These skills and competencies are essential to creating gamified experiences that are engaging, effective, and aligned with business goals and objectives. By developing these skills and competencies, product managers will be able to design and implement gamification strategies that drive meaningful user behaviors and outcomes, and that help to differentiate their products in a competitive market.

Figure 2.1 – Comprehensive product mindset

The top 10 core competencies of product managers are as follows:

• Qualitative market research:
  • Focus groups: A research method for gathering feedback from a group of potential or existing users about a product or service.
  • In-depth interviews: A research method for obtaining detailed insights and feedback from individual users about their experiences and needs.
  • Ethnography: A research method for observing and understanding user behavior and culture in their natural environment.
  • Customer site visits: A method for product managers to gain firsthand insights about how customers are using a product or service.
  • Social media: A platform for product managers to monitor and engage with users, as well as to gather feedback and insights about user needs and preferences.
• Quantitative market research:
  • Market sizing: Estimating the potential size of a target market for a product or service.
  • Surveys: Collecting data through a set of standardized questions to gain insights into customers’ attitudes and behaviors.
  • Concept tests: Testing the appeal and potential success of a new product or service idea with potential customers.
  • Consumer panels: A group of customers who are regularly surveyed or studied to provide ongoing feedback on products or services.
  • Data and analytics: The collection and analysis of data from various platforms to gain insights and inform decision-making in product management.
• Facilitating design-thinking workshops:
  • Problem validation: Process of testing and validating the problem statement by gathering feedback from potential users or stakeholders to ensure that the problem being addressed is a real, important, and relevant one that requires a solution.
  • Hypothesis testing: Creating a set of assumptions about the problem and solution, then testing them through experimentation and data analysis. Validating your ideas, identifying potential risks and challenges, and refining the solutions based on feedback from users.
  • Ideation: Participants generate a large number of ideas and potential solutions to the problem statement through brainstorming and other creative techniques.
  • Innovation: Developing a novel, valuable, and feasible solution that addresses the problem statement and meets user needs. This involves synthesizing insights and ideas from the previous stages, prototyping, and testing the solution with users.
• Prototyping and validation:
  • Requirements gathering: Collecting and documenting information about what the product should do, based on user needs and business goals.
  • Running design sprints: Structured process for generating and testing ideas in a short amount of time, to rapidly iterate and improve the product or feature idea.
  • Clickable prototype: Simulated version of the product that users can interact with, allowing for feedback and testing before building the full product.
  • Proof of concept: A working prototype that demonstrates the feasibility of a product or idea, typically used to secure funding or support for further development.
• Feature prioritization and roadmap planning:
  • Prioritizing your product in the portfolio: Determining how your product aligns with the company’s overall strategy, prioritizing it within the product portfolio, and allocating the appropriate resources to ensure its success.
  • Prioritizing product features: Using data, customer feedback, and market trends to prioritize which features are most important to build and when to build them.
  • Roadmaps: Documents that communicate the vision and direction of the product, align teams on priorities, and provide transparency to stakeholders on what will be delivered and when.
  • Dependencies and risk management: Identifying dependencies between teams and managing potential risks that could impact the product’s development and launch. You must also have contingency plans in place to mitigate any potential roadblocks.
• Resource allocation:
  • Negotiation: Communicating and compromising with stakeholders to achieve desired project outcomes. Product managers must negotiate for project resources and new business goals in order to successfully implement and launch a product.
  • Project resource demand: Accurately estimating and communicating the resources required to execute a project, including staffing, budget, and time, to ensure that the team has what it needs to succeed and that stakeholders are well informed.
  • New business goals: Having a strong understanding of the company’s business goals and objectives, and being able to align the product roadmap with those goals to ensure that the product is contributing to the company’s overall success. This includes being able to identify opportunities for growth and new markets to enter and allocate the necessary resources to make it happen.
• Strategic thinking and problem solving:
  • Understanding the market and competition: Possessing a deep understanding of the market and competition to make informed decisions and position their product in a way that differentiates it from competitors. Keeping up with market trends, customer needs, and industry advancements.
  • Setting a vision: Setting a clear vision for their product, outlining the goals, target audience, and objectives that the product must achieve. A well-defined vision can provide direction and align stakeholders toward a common goal.
  • Solving complex problems as they arise: Identifying and solving complex problems related to your product. You must have strong problem-solving skills to identify root causes, analyze data, and develop and implement effective solutions that align with the overall product vision and objectives.
• Translator between the business and technology teams:
  • Brevity communication: The ability to communicate ideas and information concisely and clearly, making sure that all parties involved understand the key points and objectives.
  • Constructing arguments: The ability to build and articulate compelling arguments in support of a particular position or decision, using logic, evidence, and persuasive techniques.
  • Presentation design: The ability to create engaging and effective presentations that communicate key messages and information to diverse audiences, utilizing visual aids, storytelling, and other techniques to enhance understanding and retention.
• Pricing strategy and revenue modeling:
  • Price elasticity and psychology: The concept of price elasticity refers to the sensitivity of demand for a product or service in response to changes in its price, while psychology refers to the study of human behavior and how it influences decision-making. Together, product managers need to understand how these two factors interact to inform pricing strategies that maximize revenue while remaining attractive to customers.
  • Revenue model options: There are various revenue model options available to product managers, such as subscription-based, freemium, pay-per-use, or advertising-based models. Product managers need to evaluate the pros and cons of each revenue model option to determine the most effective and profitable approach for their product.
  • Customer lifetime value (CLV): The estimated amount of money a customer will spend on a product or service over the course of their relationship with the company. Product managers need to understand how to calculate CLV and use it to inform pricing decisions and marketing strategies that aim to retain and attract high-value customers.
• Defining and tracking success metrics:
  • Metrics by category: The process of categorizing different types of metrics, such as usage metrics, financial metrics, and customer satisfaction metrics, to evaluate the performance of a product and inform decision-making.
  • Selecting metrics: The process of selecting the most relevant and effective metrics to measure the success of a product based on business goals and objectives.
  • Tracking and reporting: The process of continuously monitoring and measuring the selected metrics, analyzing the data, and presenting the findings in a clear and actionable format to inform decision-making and optimize the performance of a product.

Gamification will tie into almost all of the core functions in one aspect or another if you choose to bring it into your product development strategy. In the chapters ahead, we will link gamification to the core functions of a product manager.

Product managers’ emotional quotient (PMEQ)

Product managers need to have a high level of emotional intelligence or a high emotional quotient (EQ) since the primary functions of their job are representing the voice of the customer, managing a cross-functional team, and managing up to business stakeholders. EQ is the ability to manage your emotions and those of others, which is essential for building effective working relationships, managing conflicts, and driving successful product development.

To understand how to successfully utilize gamification in your product, you must have excellent relationship management skills to find the necessary information and insights on your user’s wants and needs. You need to develop empathy for the user and get a deep understanding of their needs and motivations. EQ gives you an empathetic ear and will give you the insight to design your game mechanics in a way that meets your users’ needs and innovates on the art of the possible.

Product management is a fast-paced and rapidly changing environment. EQ will help you navigate ambiguity and develop resilience to satisfy your stakeholders’ needs and concerns about implementing something they may need to be more familiar with. You’ll also need to develop and manage relationships with your stakeholders because they will be the ones who likely sign off on your gamification strategy and are the gatekeepers for product launches, budgeting, and other administrative functions.

Product managers must be able to work effectively with a wide range of people with different skills, personalities, and perspectives. Relationship skills are essential for selling the team on your vision of a gamified product or feature, managing conflicts, negotiating sprint priorities, and keeping the team aligned and motivated to reach your goals. Emotional intelligence can help product managers build strong, collaborative teams by understanding and appreciating the strengths and differences of team members. Also, you work closely with designers and engineers daily.

“Elite eight” product manager skills

Finally, there are the “elite eight” skills of a product manager. Product managers don’t have to be experts in these areas, but they need to be well versed in the languages to work with the teams who are the experts in these areas, and they need to know the specifics of how these areas relate to their success. We will look into these skills in the following subsections.

User experience (UX) and user interface (UI) design

As it relates to gamification, this combined area is one of the two most important to understand – so important, we wrote a whole chapter on it. If gamification fits your strategy, UX and UI should be considered in your solution’s structure and design to help users meet their goals.

UX

UX refers to a user’s overall experience while interacting with a product, service, or system, including their emotions, perceptions, behaviors, and responses. UX design enhances user satisfaction by improving the usability, accessibility, and desirability of the product or system, considering the users’ needs, preferences, and expectations.

The UX strategy is the long-term plan that guides the design and development of a product or service to provide an optimal UX. It involves research, analysis, and planning to align the product’s features, functions, and design with the users’ needs, goals, and use context.

In the context of a product manager’s role, the UX strategy plays a crucial part in defining and prioritizing product features and improvements. A product manager is responsible for guiding a product’s development, launch, and ongoing management, ensuring it meets user needs and business objectives. The UX strategy helps product managers do the following:

• Understand users: Conduct research to gain insights into users’ needs, preferences, and pain points, which inform product decisions and priorities
• Develop user personas: Create fictional representations of the target users to empathize with their needs, motivations, and behaviors and guide product design
• Create user journeys and scenarios: Map out the various steps, interactions, and touchpoints users have with the product, identifying opportunities for improvements and innovation
• Prioritize features and improvements: Use insights from UX research to prioritize and make informed decisions about the features and enhancements that will significantly impact user satisfaction and business objectives

As stated, this journey starts with empathically understanding your users’ wants, needs, and motivations. Once you understand that, you and your team must design the solution, which is the art and science of where UX, game mechanics, and product management meet. You need to leverage the art of UX and game design with the science of UI best practices, your technological capacity, and the business case.

When thinking about gamification, the first step is to see whether it is a viable solution for your use case. Will gamification theory or game mechanics help your users solve their need and drive your business case? A helpful tip is to be involved with market research and investigate your potential users. Once you understand their needs, compile a few rudimentary designs that showcase your gamification hypotheses for a solution. Bring these back to the user, and test your hypotheses early and often.

UI

UI design creates a digital product or system’s visual elements and interactive components, such as websites, mobile applications, or software programs. UI design aims to create an aesthetically pleasing and functional interface that facilitates smooth and efficient user interactions, making it easy for users to achieve their goals and complete tasks.

UI design is closely related to UX design, as both disciplines aim to create a seamless, enjoyable experience for users. While UX design focuses on the product’s overall user journey and usability, UI design addresses the specific visual and interactive components that enable users to interact with the product effectively. UI design encompasses several aspects, including layout, color schemes, typography, icons, buttons, and other interactive elements. It focuses on the presentation and interactivity of the product, ensuring that the interface is visually appealing, user-friendly, and consistent with the brand’s identity.

In the context of a product manager’s role, UI design plays a vital part in the development and success of a digital product. A product manager guides a product’s development, launch, and ongoing management, ensuring it meets user needs and business objectives. UI design helps product managers do the following:

• Define visual and interactive requirements: Collaborate with UX designers to translate user needs and goals into visual and interactive elements that are easy to use and understand
• Maintain consistency and branding: Ensure the UI design adheres to brand guidelines and design systems, providing a consistent experience across all touchpoints and platforms
• Stay current with UI trends and best practices: Keep updated with the latest developments in UI design, technologies, and methodologies, ensuring the product’s interface remains modern, engaging, and competitive
• Validate and iterate designs: Test UI design prototypes with real users, gather feedback, and make data-driven improvements to enhance usability and user satisfaction
• Oversee design implementation: Work with development teams to accurately implement the UI design mechanics, addressing any discrepancies or issues that may arise during the development process

You should have an in-depth understanding of prototyping and usability testing to know whether the game mechanics work. You should be able to speak the language with your designer around current trends and best practices in user-centered design, design thinking, customer journey mapping, interaction design, and visual design.

Psychology

Design is the heart of gamification, and psychology is, well, its brain. It’s the other most vital skill to understand while developing your gamification strategy. With your market research and UX discovery, you should have a good idea of your persona and their behaviors. The inspirational design blends into both areas since you have to know the wants and needs of the user to be able to design something that is emotionally engaging for them and is aesthetically pleasing, and drives the user’s brain to resonate with the design.

When you start getting into the psychology of your user, you should understand the principles of persuasion and influence and be able to use these principles in your product design and experience to drive user engagement and adoption ethically. The subtle art of persuasion is also a tactic you will want to know when working with marketing and advertising teams. One of the best books written about this was the groundbreaking Influence by Robert B. Cialdini, Ph.D., which is widely referenced and taught in both product management and consulting. The six fundamental ways in which people are influenced are as follows:

• Reciprocity: The principle of reciprocity suggests that people are more likely to comply with requests or demands if they feel they have received something of value first. In other words, if you do something for someone else, they are more likely to do something for you in return.
• Authority: The principle of authority suggests that people are more likely to comply with requests or demands from someone perceived as an authority figure. This figure could include someone with expertise, experience, or credentials in a particular area.
• Commitment and consistency: The principle of commitment and consistency suggests that people are more likely to comply with requests or demands if they have already made a commitment or taken a position consistent with the request. For example, if someone has already made a small commitment to a cause or idea, they are more likely to make a more significant commitment in the future.
• Social proof: The principle of social proof suggests that people are more likely to comply with requests or demands if they see that others like them are doing the same thing. In other words, the actions and opinions of others influence people to take or not take specific actions.
• Liking: The principle of liking suggests that people are more likely to comply with requests or demands from people they like or find attractive, hence the popularity of the influencer role on social media. This “influencer” could include people who are similar to them, have given them compliments, or have built a rapport with them.
• Scarcity: The principle of scarcity suggests that people are more likely to comply with requests or demands if they believe that the opportunity is rare, unique, or valuable. In other words, people are motivated to take action when they believe they need to catch up on something desirable or limited in availability.

Overall, these six fundamental patterns describe the important ways people are influenced and persuaded to comply with requests or demands. By understanding these patterns, individuals can develop more effective strategies for influencing and persuading others.

And that gets us to the primary goal of developing a gamification strategy…motivation. An elite product manager understands what motivates users to use and engage with products. They can use this knowledge to create motivating and rewarding products for users; gamification techniques such as leaderboards and rewards programs are vital tools we will explore in this book.

Engineering management

An elite product manager has a strong understanding of software development methodologies, and since digital technology is the focus here, those methodologies are going to primarily be Agile frameworks, with variations such as Scrum, SAFe, Kanban, The Lean Startup method by Eric Ries, Spotify by…Spotify, Rapid Application Development (RAD), Extreme Programming (XP), and others that people claim they do they do but really they practice Waterfall. For the purposes of this book, we will be hypothetically developing in Agile and Lean and giving examples that fit one of the frameworks.

For a refresher, Scrum, Agile, and Lean are all software development methodologies that aim to streamline the development process and deliver high-quality software products efficiently. Here are some of the similarities and differences between these methodologies.

Similarities

• Iterative and incremental: All three methodologies follow an iterative and incremental approach to software development, focusing on continuous improvement and delivering working software quickly
• Collaborative: All three methodologies emphasize collaboration between team members, focusing on teamwork, communication, and shared ownership
• Customer-focused: All three methodologies prioritize the needs and expectations of the customer, with a focus on delivering value and meeting user needs

Differences

• Scrum: Scrum is a specific framework within the Agile methodology that emphasizes iterative development, cross-functional teams, and frequent feedback. It is based on a set of roles, ceremonies, and artifacts and aims to deliver a potentially shippable product increment at the end of each sprint.
• Agile: Agile is a comprehensive and flexible methodology emphasizing collaboration, flexibility, and responsiveness to change. It is based on values and principles and includes several frameworks, such as Scrum, Kanban, and XP.
• Lean: Lean is a methodology that emphasizes maximizing value while minimizing waste. It aims to eliminate inefficiencies and streamline processes, focusing on delivering value to the customer and continuous improvement. Delivering value, eliminating waste, and continuous improvement are the core principles of this methodology.

Overall, Scrum, Agile, and Lean all share a common goal of delivering high-quality software efficiently and collaboratively. However, they differ in their specific approaches, with Scrum being a specific framework within Agile that emphasizes cross-functional teams and frequent feedback. Agile is a flexible and adaptable methodology that prioritizes collaboration and responsiveness. Lean is a methodology that emphasizes value delivery and waste elimination. Gamification fits into all these with frequent feedback and doing more with less.

With your understanding of the engineering frameworks, you should understand the basic definitions of user stories, acceptance criteria, technical architecture, application programming interfaces (APIs), tech debt, code reviews, unit testing, quality assurance (QA), user acceptance testing (UAT), release management, and DevOps.

It will be a bonus if you come from engineering and understand how to code or have a deep understanding of architectural and cloud platforms; this will set you up to master the technical product manager position.

Data and analytics

A product manager understands big data and analytics and can use data to inform product development decisions. But the modern product manager has multiple platforms to understand, depending on where or who they work for. Also, data and analytics tools are constantly evolving, and you must be up to speed with the changes.

There is also a vast selection of options out there now. For example, Adobe Analytics uses multiple tools and functions to track, measure, and analyze customer interactions. It allows businesses to track customer behaviors and preferences, measure marketing campaigns’ effectiveness, and identify improvement areas in their digital experiences. Mixpanel is a web and mobile analytics platform that provides real-time data processing, user behavior tracking, and A/B testing capabilities. Businesses use it to focus on product and UX optimization. Hotjar is a web analytics and user feedback tool that provides heatmaps, session recordings, and user surveys. It allows businesses to identify areas of a website that need improvement and to collect user feedback to guide their optimization efforts. I picked these examples because I have used them and had successful experiences. There are many more platforms to explore to see which fits your organization, needs, goals, and price points.

Product managers may also have to make their dashboards, building and populating databases that connect to Microsoft Power BI or Tableau. Please create your dashboard when displaying a product with game mechanics (which we will get into in more depth in a later chapter). The data and analytics you will need to be successful in your gamification journey are as follows:

• Measuring engagement: This is your most crucial tracking mechanism. It would help if you were tracking metrics such as user participation, time spent on the platform, and game completion rates. How are your users engaging with your product?
• Continual improvement: Analyze user feedback, performance data, and exits to identify areas where product teams can optimize their gamification by adjusting the difficulty level of challenges, adding new features, or optimizing the UX.
• Objectives and key results (OKRs): When you decided to gamify your product or feature, you had a business goal you were trying to achieve, such as revenue growth, retention, or a number of sessions. By tracking the costs and benefits of your gamification, you can determine the return on investment (ROI), and whether it provided the key results you planned on and sold to your stakeholders.
• Team health: Develop internal metrics to track releases, the health of your process, the pulse of your team, and the quality of code and architecture. You can only build a product successfully with an engaged team producing quality work and working together effectively.

When building a gamification strategy, you may use artificial intelligence and work with data scientists to build machine learning models that power your game mechanics. It’s important to understand that data scientists work differently than engineers, have unique skill sets and challenges, and require their management techniques. Data scientists may only sometimes prefer Agile methods due to data science projects’ unique challenges and workflows. Unlike Agile methods emphasizing rapid iteration and continuous delivery, data science projects often require significant data preparation and exploration, which can be time-consuming and unpredictable. The focus of Agile methods on quickly delivering working software may not leave sufficient time for rigorous testing and QA, which could compromise the integrity of data scientists’ models and analysis.

Additionally, data science projects often require experimentation and research to explore different approaches and hypotheses, which may be limited in an Agile environment due to the pressure to deliver results quickly. However, many data science teams have successfully adopted Agile methods by adapting them to fit their unique workflows and needs, demonstrating that the success of any project management approach will depend on the specific context and the preferences of the team involved. Before you begin your gamification development, talk with your data scientists and set expectations for project execution.

You might be working with a data team or teams to ensure that products are designed and launched in a way that maximizes user engagement and drives business growth. Data analytics, data mining, data visualization, data-driven decision-making, key performance indicators (KPIs), metrics, A/B testing, cohort analysis, funnel analysis, segmentation, data governance, and data privacy are all terms that should be on your radar.

Marketing

Undertaking a gamification strategy requires a strong understanding of marketing principles, including brand management, customer acquisition, and user engagement. As a product manager, you should work closely with marketing teams to ensure that products are launched and promoted to maximize user adoption and market share.

As the product manager who drives the vision and understands the users’ pains, gains, and motivations, you should be the marketing team’s key to unlocking their messaging potential. You can relate the message to stop the pain points or motivations of the user; you can explain how the game mechanics work and why people would love to use them.

Marketing plays a critical role in the success of a gamification strategy by promoting the product and engaging users. Gamification relies heavily on marketing to drive user acquisition and engagement and promote the product’s unique features and benefits.

One of the key ways that marketing can support a gamification strategy is through user acquisition. By promoting the gamified elements of the product through targeted campaigns, social media, and other channels, marketing can drive awareness and interest in the product. Your marketing strategy is fundamental in the early stages of the product launch when building an initial user base is critical.

In addition to user acquisition, marketing can also help to keep users engaged with the product by promoting ongoing gamification events and features. For example, by promoting challenges, leaderboards, and rewards, marketing can incentivize users to continue using the product and engage with its gamified elements. Focusing your marketing campaign on the fun aspects of your game mechanics can increase user retention and drive ongoing engagement with the product.

Another essential role of marketing in a gamification strategy is brand building. By promoting the product’s gamified elements and unique features, marketing can help build the product’s brand and create a robust and engaging identity that resonates with users. The tactical marketing focus can help to differentiate the product from competitors and build a loyal user base that is more likely to continue using the product over time. And remember, as the product manager, you are the brand as well. So things you do on social media affect the brand of the product you represent.

Marketing can also gather user feedback on the gamification strategy and product features. Product managers can improve their gamification strategy by working with the marketing team to monitor user feedback and sentiment. The findings from this collaboration clearly identify areas where product managers could enhance the existing gamified experience or additional features could be added. Marketing can share this information with the product development team to inform future iterations and improvements.

Finally, marketing can help track key metrics such as user engagement, acquisition, and retention. By monitoring these metrics, marketing can evaluate the success of the gamification strategy and make data-driven decisions about how to refine and optimize the strategy over time.

By working closely with marketing teams, product managers can leverage their expertise in user acquisition, engagement, and brand building to help promote and enhance the gamification strategy, ultimately leading to increased user adoption, engagement, and retention. Through ongoing collaboration between product and marketing teams, gamification can be a powerful tool for driving business growth and user satisfaction.

Brand management, market research, customer acquisition, customer retention, customer engagement, marketing automation, inbound marketing, outbound marketing, search engine optimization (SEO), pay-per-click (PPC) advertising, content marketing, and social media marketing are all terms that should be on your radar with the marketing teams.

Legal and compliance

An elite product manager understands the legal and regulatory landscape in which their products operate and understands issues such as data privacy, security, and intellectual property. They work closely with legal teams to ensure products comply with relevant laws and regulations.

Legal and compliance matter to a product manager who is using gamification because gamification often involves collecting and using user data, which can raise legal and regulatory issues around data privacy, security, and intellectual property. Failure to comply with relevant laws and regulations can result in significant legal and financial consequences for the company, as well as damage to the company’s reputation and user trust.

Specifically, legal and compliance matter in the following ways:

• Data privacy: Gamification often involves the collection and use of user data, such as personal information, behavioral data, and other sensitive information. Product managers must be aware of relevant data privacy laws, such as GDPR or CCPA, and ensure their gamification strategy complies with these laws. Areas to focus on may include the following:
  • Obtaining user consent
  • Implementing appropriate data security measures
  • Ensuring that you or the company does not utilize user data for purposes beyond what is disclosed in the company’s privacy policy
• Intellectual property: Gamification often involves the creation of original content, such as game mechanics, graphics, and other visual elements. Product managers need to be aware of relevant intellectual property laws, such as copyright and trademark laws, and ensure that their gamification strategy is not infringing on the intellectual property rights of others. Your responsibility may involve conducting thorough research to ensure that the gamification elements are original or obtaining permission to use copyrighted materials. On the other hand, if you create something so original that it justifies registering a copyright or trademark, work with your legal team to protect your intellectual property.
• Consumer protection: Gamification strategies can potentially exploit users through misleading or deceptive practices. Product managers must be aware of relevant consumer protection laws, such as the FTC Act, and ensure their gamification strategy is transparent and not misleading. Your due diligence may involve the following:
  • Clearly communicating the game’s rules
  • Disclosing any fees or costs associated with the game
  • Ensuring that false claims or promises do not mislead users
• Industry standards: Gamification often involves using industry standards, such as Open Badges or Game On, with their own guidelines and best practices. Product managers must be aware of these industry standards and ensure that their gamification strategy complies with them. We will cover many of these in this book, and you are well on your way to conducting research by reading this book. You should also be open to consulting with industry experts to ensure that your gamification strategy aligns with industry best practices.

Example – Hi-Z Fitness App

Background: Hi-Z Fitness App is a mobile application designed to help users track their workouts, set fitness goals, and stay motivated through gamification features such as leaderboards, badges, and rewards. The app collects personal information, such as users’ names, email addresses, workout data, and location information.

Challenge: As the product manager for Hi-Z Fitness App, you need to ensure that the app complies with data privacy and security regulations, such as the General Data Protection Regulation (GDPR) in the European Union and the California Consumer Privacy Act (CCPA) in the United States. Additionally, the app should respect intellectual property rights when implementing gamification elements such as badges and rewards.

Solution: To address these challenges, the product manager took the following steps:

• Collaborated with the legal team to review the app’s data collection, storage, and processing practices to ensure compliance with GDPR, CCPA, and other relevant regulations. The outcome included implementing features that allow users to access, delete, and modify their personal information and opt out of data sharing with third parties.
• Partnered with the appropriate partners to conduct a thorough risk assessment to identify potential security vulnerabilities and implemented security measures to protect user data, such as data encryption, access controls, and regular security audits.
• Worked with the design team to create original gamification elements such as badges and rewards, avoiding potential intellectual property infringement issues arising from using copyrighted or trademarked material.
• Received a clear and comprehensive privacy policy and terms of service from the legal team, explaining how the app collects, uses, and shares user data and the measures taken to protect users’ privacy and security to which they have access.
• Implemented an ongoing compliance monitoring program, ensuring that changes to legal and regulatory requirements are promptly addressed and the app remains compliant.

Outcome: By working closely with the legal team and taking a proactive approach to legal and regulatory compliance, the product manager was able to successfully launch the Hi-Z Fitness App with gamification features that complied with data privacy, security, and intellectual property laws. As a result, the app avoided potential legal and financial consequences and built trust with users, contributing to its success and growth in the competitive fitness app market.

As a product manager, data privacy, intellectual property, patents, trademarks, copyrights, data security, GDPR, CCPA, the Children's Online Privacy Protection Act (COPPA), FTC regulations, compliance, terms of service, and privacy policy should be terms on your radar when talking to legal.

Economics and finance

An elite product manager understands basic economic concepts such as supply and demand, price elasticity, and market competition. They work closely with business teams to develop effective pricing strategies and ensure products are priced to maximize profitability. Their understanding of supply and demand and market competition can help product managers design gamification strategies that stand out in a crowded market. Understanding the behavior of consumers and competitors can help a product manager to identify areas where their gamification strategy can differentiate them from the competition.

Pricing strategies are a core competency in product management, but knowing price elasticity is a significant upgrade when figuring out how responsive demand is to changes in price. One of the game mechanics is having a rewards system for users that complete specific objectives or tasks. The price elasticity of the product can impact the effectiveness of the incentive. There is a balance between how much you pay for the service and the value of the reward you may receive. And the price is only sometimes financial. Some products may ask you to collect data or personal information in exchange for rewards.

Financial incentives tie into rewards, which tie into psychology. It’s helpful to understand the basic principles of behavioral economics, such as decision-making biases and heuristics. Product managers can use this knowledge to develop products designed to overcome these biases and drive user behavior in specific ways.

For example, many gamification strategies offer users rewards or financial incentives in exchange for completing certain tasks or achieving specific goals. By understanding decision-making biases and heuristics, product managers can design these incentives in a way that is likely to motivate users and drive engagement.

Some examples of decision-making biases and heuristics that product managers may consider when developing gamification strategies include the following:

• Loss aversion: People tend to be more motivated by the fear of losing something than the possibility of gaining something. Product managers may design gamification strategies emphasizing the potential loss of rewards or status to motivate users to act.
• Social proof: The behaviors of others influence the thoughts and actions of people all of the time. Product managers may design gamification strategies that highlight the actions of other users, such as displaying leaderboards or sharing social media posts, to encourage users to participate.
• Status quo bias: People prefer the status quo, even if it is not the best option. To overcome this bias, product managers may design gamification strategies that encourage users to try new behaviors or break old habits.

Duolingo (2012)

Touting itself as the #1 way for someone to learn a new language, Duolingo hit the public app stores in 2012. The application has over 60 million monthly average users and is full of gamification examples.

Download the Duolingo app and give it a try. Within the first couple of minutes, you are encouraged to learn a new language using a number of gamification cues. One of the most powerful strategies Duolingo uses however is the “Number of Consecutive Days” streak counter. By logging in and completing one lesson a day, you can keep this streak alive. See how far you can take your streak. At what point does the loss aversion take effect for you? Did you make it to 5 days? 20? Even higher? The longer that streak becomes, the harder you will try and keep it, which can be a powerful method for staying fresh in the mind of your users.

Using their behavioral economics knowledge, product managers can design gamification strategies that are more likely to drive user engagement and achieve business goals. They can create incentives and rewards tailored to specific decision-making biases and heuristics to maximize the gamification strategy’s effectiveness.

Finally, the last section of utilizing your economic skills is internal. To get your product or feature funded, you will have developed (or should be developing) a business case. In the business case, you will have to show your stakeholders the value of your product. Developing financial metrics on CLV, CAC, profit margins, and ROI is an essential aspect of product management, mainly when designing gamification strategies:

• Customer Lifetime Value (CLV): CLV is a metric that measures the total value a customer will bring to a company over the course of their relationship. To calculate CLV, product managers must take into account the average revenue per customer, the length of the customer relationship, and the costs associated with serving that customer. By understanding the CLV of their customers, product managers can allocate resources better and develop gamification strategies that maximize the long-term value of each customer.
• Customer Acquisition Cost (CAC) : CAC is a metric that measures the cost of acquiring a new customer. To calculate CAC, product managers must consider the total cost of sales and marketing activities related to acquiring new customers over a given period, divided by the number of new customers acquired in that period. By understanding the CAC, product managers can better allocate resources and develop gamification strategies tailored to drive user acquisition cost-effectively.
• Profit margins: Profit margins are a metric that measures the difference between revenue and costs associated with a product. Product managers must understand the costs associated with developing and marketing a product and the revenue generated from sales to calculate the profit margin. By understanding the profit margins associated with different products or services, product managers can make informed decisions about resource allocation and develop gamification strategies designed to maximize profitability.
• Return on Investment (ROI): ROI is a metric that measures the financial return on a particular investment, such as a gamification strategy. To calculate ROI, product managers must consider the costs associated with developing and implementing the gamification strategy and the financial benefits resulting from increased user engagement, retention, and profitability. By understanding the ROI of a gamification strategy, product managers can make informed decisions about resource allocation and can optimize the strategy to maximize ROI.

Product managers must have a deep understanding of financial metrics to develop effective gamification strategies. Product managers can make informed decisions about resource allocation and develop gamification strategies tailored to meet specific business goals by calculating and analyzing metrics such as CLV, CAC, profit margins, and ROI. By leveraging financial metrics, product managers can create gamification strategies that are engaging for users and profitable for the company.

Product managers should understand the core concepts of supply and demand, pricing strategies, cost-benefit analysis, market competition, market segmentation, loss aversion, CLV, CAC, revenue, profit margin, break-even point, and ROI.

Public policy

Product managers must understand the political and regulatory environment when designing gamification strategies. An elite product manager must be well versed in consumer protection, environmental regulations, and industry standards and work closely with policy teams to ensure that products are compliant with relevant policies and regulations.

Political and regulatory issues may impact the design of gamification strategies. For example, gamification strategies that involve financial incentives or rewards may need to comply with industry standards or government regulations that dictate how rewards are distributed or used. Additionally, gamification strategies may involve public policy issues, such as health and safety regulations, impacting how the product is designed and marketed.

Stakeholder management is also crucial to product management, particularly when designing gamification strategies. Product managers must work closely with their leadership team to align with external stakeholders, such as policymakers, industry groups, and consumer advocates, to ensure the gamification strategy is well received and supported. Policy advocacy is more of a support role that may involve lobbying efforts to shape policy or engage with stakeholders to address concerns or gain support.

Overall, an elite product manager must understand the political and regulatory landscape in which their products operate to design effective gamification strategies. Product managers can ensure that gamification strategies comply with relevant regulations and laws and address potential stakeholder concerns by working closely with policy teams and legal experts. Your role ultimately helps to build trust and credibility with users and stakeholders and can drive greater user engagement and business success.

Product managers should understand the core concepts of consumer protection, environmental regulations, industry standards, government regulations, compliance, lobbying, public policy, political landscape, and stakeholder management.

To reiterate, we reviewed the top 10 core competencies, the emotional intelligence quotient, and the “elite eight” skills of product managers. You may have just started in product management and are still learning the core competencies, or you may be a seasoned pro and have mastered all skills and then some. This overview shows how gamification ties to all aspects of a product manager’s role and responsibility. It is a skill that requires tremendous work and insight but also provides tremendous opportunity. We wrote this book to help you navigate the journey and become a better product manager using best practices and gamification techniques.

How this book fits into your product career

Layering in the gamification best practices on top of 0ur core competencies, a high level of emotional intelligence, and elite product manager skills will make you a better product manager. Harnessing the transformative power of gamification is not an isolated endeavor but a holistic strategy that requires the synergy of various competencies, perspectives, and skills. This approach is encapsulated in the following arguments:

• Argument 1: You can incorporate your gamification strategy into your core competencies. When doing market research, you will now have more insight and can ask users how they feel about specific game mechanics such as levels or leaderboards. As you build your solution, you have a toolbox of gamification features you can insert into your prototype or proof of concept. When you are workshopping, you can use success stories around gamification to stimulate new ideas and innovation.
• Argument 2: As a product manager with emotional intelligence, you understand the importance of researching with empathy to truly understand the user and their needs, whether they like to play games or not. Human-centered design is being able to use the game mechanics and solutions to solve a problem for your user. Relationship management with your teams allows you to bring your gamification vision to life by motivating and leading your team. And it also allows you to sell the vision to your stakeholders to get the clearance and funding to build a successful product or feature with game mechanics.
• Argument 3: Understating the “elite eight” skills of product managers will give you insight into all the areas you need to be connected to make your product successful. Each of the “elite eight" is a team you should be working with, and if you are in a smaller company, knowing what should be done in these areas will be critical to your success. Each of these areas plays a crucial role in gamification, some more than others, but they are all essential for success. You want to pay attention to all of them because you don’t want to create a fantastic product that users love, only to have it shut down due to legal implications or, much worse, get sued.