Understanding How Product Outcomes Connect to Revenue and Costs

Teresa Torres and Hope Gurion analyze free-text answers from a 2022 benchmark survey where many product teams answered 'other' when asked whether their product aims to grow revenue or reduce costs. Using real examples like TV channels, documentation teams, consulting firms, platform teams, churn reduction, and security work, they show how teams often fail to connect their outcomes to business outcomes. Their central point is that most product work ties back to revenue or cost, and that clarity usually depends on leaders providing strategic context. Teams that cannot make that connection are left to infer priorities themselves, which can misdirect their backlog. The discussion also offers a practical test for deciding which side a team's work falls on.

01Key takeaways

• Ask whether your team's work primarily increases revenue or reduces costs, and be able to explain the connection.
• If you cannot tell which side your work falls on, push leadership for clearer strategic context rather than guessing.
• Recognize that a lagging business outcome like churn needs to be translated into leading product behaviors.
• Free products can still drive revenue when they feed paid products or ecosystems.
• Pick one primary outcome at a time, since teams trying to serve revenue and cost goals at once often make less progress.
• Classify internal work by who it ultimately serves: customers generally point to revenue, while internal efficiency points to cost.

02Key sections

Why the 'other' answers matter

Nearly 7% of survey respondents chose 'other' when asked about revenue or cost goals, signaling a gap in business context. The authors frame this as a leadership responsibility rather than a failing of individual teams.

Ambiguous cases: documentation and public-funded channels

Documentation and government-funded media examples show that the same work can serve revenue or cost goals depending on the audience and funding model. The choice of target shapes what a team actually builds.

Platform, consulting, and nonprofit contexts

Platform teams, consultancies, and nonprofits each show different ways outcomes can be framed, and the authors argue platform work usually belongs on the revenue side when it serves customer value. Teams serving multiple clients or internal customers risk confusing customer outcomes with company outcomes.

Lagging metrics and hidden revenue links

Churn reduction is a lagging business outcome that should translate into product outcomes tied to revenue. Security and compliance work can protect revenue or avoid fines, and the choice between them reflects what a company is primarily building for.

A guiding principle for classifying work

Work that creates customer benefit leans toward revenue regardless of whether the customer pays directly, while internal work depends on who the internal users serve. Asking who is served is a practical way to decide the category.

03From the post

“Product teams need to understand how the work they are doing impacts the business. It's up to product leaders to share this strategic context with their teams. Our 2022 CDH Benchmark Survey exposed some gaps in this area. We asked teams: “Is your product intended to grow revenue, reduce”

04Frameworks mentioned

Summary and takeaways written by PM Atlas; quotes are short excerpts. © the original author.