Updated: April 2, 2025- 10 min read
Ask any product manager what their biggest challenge is, and you’ll at one point hear something about prioritization and focus. Too often, product teams get stuck in a cycle of shipping feature after feature without a clear sense of whether they’re actually making an impact.
Product managers are often those who ask the critical question: “Is this really where we’re supposed to be headed right now?”.
A good product goal does more than just give your team direction — it connects the dots between your product vision, customer needs, and the work happening in sprints. It helps you move beyond output (building things) and focus on outcomes (creating value).
But setting the right product goals is harder than it sounds. How do you make sure they’re meaningful, measurable, and actionable? How do they fit within an agile framework? And how do you track progress without micromanaging?
Let’s get started.
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What Is a Product Goal? A Pragmatic Definition
A product goal is a clear, measurable objective that guides product development over a mid-term timeframe within the Scrum framework. Scrum is an Agile methodology that helps teams work iteratively, delivering value in small, incremental cycles, fundamentally looking like this:
Introduced in one of the updates of the Scrum Guide, the product goal sits at the top of the product backlog and provides long-term direction for the Scrum team. It helps teams move beyond day-to-day execution and align their work with the product vision, business strategy, and sprint planning.
Unlike a sprint goal, which focuses on a short, incremental development cycle, or a product vision, which is broad and aspirational, a product goal provides a concrete milestone that teams can work toward.
It ensures that backlog prioritization and sprint planning decisions align with incremental progress toward the product goal—rather than just delivering isolated features.
At its core, a product goal answers three key questions within Scrum:
What are we trying to achieve with this product in the next few months? (Guiding backlog refinement and prioritization)
How does this goal contribute to our broader business objectives? (Ensuring alignment between Scrum execution and company strategy)
What does success look like, and how will we measure it? (Providing a clear target for sprint reviews and product increments)
By setting a well-defined product goal, Scrum teams can focus on delivering value incrementally rather than just completing tasks. It ensures that product roadmaps and backlogs aren’t just a list of features, but a strategic path toward meaningful outcomes, driving continuous improvement through each sprint.
How product goals fit in the product management hierarchy
To understand product goals in context, it’s helpful to see how they fit within the bigger picture of product management:
Product Vision – The long-term aspiration for the product (e.g., “Make fitness tracking effortless and accessible for everyone”).
Product Strategy – The approach to achieving the vision (e.g., “Focus on AI-driven insights and seamless device integration”).
Product Roadmap – A high-level plan that outlines the major initiatives leading toward the vision.
Product Discovery – Identifying opportunities and validating solutions that align with the strategy.
Product Goals – Concrete, measurable objectives that define what success looks like in the near term.
Delivery (Features & Stories) – Breaking down solutions into features and further into stories, which guide the tactical execution.
Backlog & Sprints – The tactical work needed to achieve product goals, broken down into epics, user stories, and sprint goals.
Without clear product goals, teams risk working on features that don’t contribute to the bigger picture. With them, product managers can ensure that every sprint is moving the product in the right direction.
Examples of good vs. bad product goals
To illustrate the difference between effective and ineffective product goals, here are some examples:
Good Product Goal: “Improve user onboarding to increase activation rates from 30% to 50% within three months.”
Why it works: It’s specific, measurable, time-bound, and tied to a clear business outcome.
Bad Product Goal: “Make onboarding better.”
Why it fails: It’s vague, lacks a measurable outcome, and doesn’t indicate a timeframe.
Good Product Goal: “Reduce average checkout time from 3 minutes to 1 minute by Q3.”
Why it works: It directly ties product improvements to a user-centric metric.
Bad Product Goal: “Enhance checkout experience.”
Why it fails: There’s no clear definition of success or how it will be measured.
A well-structured product goal acts as a north star for the team. It guides decision-making and ensures alignment across stakeholders. By setting clear, actionable goals, product teams can move from simply building features to driving real business impact.
The True Benefits of Product Goals (and Why They’re Often Misused)
“You should really have a goal. And you have to understand, why are you building this product? What problem is it solving? Why? What will success look like? ”
— Jackie Bavaro, Former Head of Product at Asana, on The Product Podcast
A well-defined product goal is essential for keeping teams focused, aligned, and accountable. Without clear product goals, teams risk building features aimlesly. Here’s why product goals matter:
Clarity & alignment: Product goals ensure that everyone — product managers, engineers, designers, and stakeholders — is working toward the same objective. Instead of debating priorities or chasing random requests, teams stay focused on what truly moves the needle.
Strategic focus: Without product goals, teams often get distracted by feature requests, urgent but low-value tasks, or internal politics. A strong product goal keeps the team aligned with broader business priorities and prevents unnecessary feature creep or costly delays.
Measurable impact: Velocity and completed tasks don’t tell the full story. Product goals help teams measure success based on outcomes — whether it’s increased user engagement, higher user retention, or revenue growth — rather than just shipping features.
Better product prioritization: With a clear product goal in place, teams can prioritize work more effectively. Instead of debating which backlog item should come next, they can ask, “Does this contribute to our product goal?” If not, it moves down the list.
Stakeholder buy-in: Product goals provide a strong foundation for communicating decisions to product leadership, product marketing teams, sales, and customers. When stakeholders understand why certain initiatives are prioritized, alignment and support become much easier to secure.
Without product goals, product teams risk becoming feature factories — busy but not necessarily impactful. With the right goals in place, they can drive meaningful progress and deliver real value to both users and the business.
How to Set Effective Product Goals: A Step-by-Step Approach
A weak goal can lead to wasted effort. A strong one becomes a guiding force for your product strategy.
Here’s a structured approach to setting effective product goals:
1. Start with the product vision
Every product goal should serve a larger purpose. If your product vision is unclear, your product goals will lack direction.
What to do: Before setting a goal, revisit your product vision and long-term product strategy. A product goal should move your product closer to fulfilling that vision.
Product goal example: If your vision is to "make remote work more productive," your product goals should contribute to that mission — like improving asynchronous collaboration features rather than adding random integrations.
2. Align with business objectives
A product goal should directly support your company’s business priorities, whether that’s revenue growth, user retention, or market expansion.
What to do: Identify the key metrics your company is focused on. Is product leadership prioritizing retention? Expansion into new markets? Higher conversion rates? Make sure your product goal ties into these broader objectives.
Example: If the business goal is to reduce churn by 20%, a relevant product goal might be: "Improve onboarding to increase activation rates from 30% to 50% within three months."
3. Focus on outcomes, not outputs
One of the biggest mistakes teams make is setting product goals that focus on features instead of results.
Output-focused goal (bad): “Launch a new AI-powered search feature.”
Outcome-focused goal (better): “Increase successful search queries by 40% through improved search functionality.”
The second goal is stronger because it defines what success looks like, rather than just listing a deliverable.
What to do: Ask, “What’s the real impact we want to create?” Focus on how users behave, how key metrics improve, and how the business benefits. This mindset shift is a core principle of OKRs (Objectives and Key Results).
4. Use the right goal-setting framework
There’s no one-size-fits-all method for setting product goals, but the two most widely used frameworks are:
OKRs (Objectives & Key Results): Great for high-level strategic goals that focus on outcomes.
Example objective: Improve customer engagement.
KR1: Increase daily active users from 20K to 30K.
KR2: Raise average session duration from 3 minutes to 5 minutes.
SMART Goals: Best when teams need clear, structured execution plans.
Example: "Increase checkout conversion rates from 45% to 60% by Q3 by simplifying the checkout flow and reducing friction in the payment process."
If your team struggles with execution, SMART goals can provide more structure. If you're looking for broader strategic alignment, OKRs work well. Some teams even use a hybrid approach, blending OKRs with SMART execution plans.
North Star Metric approach: Best for long-term, high-level focus
The North Star Metric (NSM) is a singular metric that represents the core value your product delivers to customers. Instead of setting multiple granular goals, teams align their efforts around improving this one key metric.
Use a North Star Metric when you need a single, company-wide focus point, when measuring multiple OKRs is too complex, and when you want to align all your metrics to a single goal.
5. Validate with data
Strong product goals aren’t based on intuition alone — they’re backed by insights from product analytics, user research, and customer feedback.
What to do: Before finalizing a goal, ask: Do we have data that supports the importance of this goal? What product metrics indicate this is a problem worth solving? Are customers actively requesting or struggling with this?
Example: If your team wants to improve search functionality, look at search success rates, user complaints, and drop-off points. If data doesn’t support the goal, refine it.
6. Collaborate, then commit
Product goals should not be dictated in isolation. While the product owner is typically responsible for defining goals, getting input from engineering, design, and other stakeholders is critical for alignment and execution.
What to do:
Involve cross-functional teams early to ensure feasibility and buy-in.
Workshop the goal collaboratively before finalizing it.
Document the goal clearly so everyone understands the target and rationale.
A product goal that is co-created by the team is far more likely to be achieved than one that’s simply handed down.
Set the Product Goal That Actually Matters
You don’t stack features like bricks and hope they form a castle.
It’s about understanding what truly moves the needle — what drives network effects, what makes customers stay, what makes an industry rethink how things should be done. It’s about solving the right problem at the right time, in a way that no one else has quite managed before.
The best product teams have an ideal vision of their dream castle. They can imagine the corridors, the rooms, colors, level of complexity, etc. The lesson is simple: you have to be super clear about where you want to get.
And that’s the real game. Not just being another product in the market, but being the one that is purposeful.
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Updated: April 2, 2025
