PM Vocabulary: Speaking the Language

This reference groups PM terms by category, starting with 10 terms to learn in your first days.

Product management combines language from business, engineering, design, and data. You don't need to learn everything immediately. Start with the terms you hear every day, then add more each week.

Day 1: ten terms to start with

Product Manager (PM) The person who decides what to build and why.

User Story A feature request written from the user's perspective. Example: "As a shopper, I want to save items for later."

Sprint A fixed time period (usually 2 weeks) to complete specific work.

Backlog Your to-do list of features and improvements.

Roadmap A view of product direction and planned priorities, sometimes shown on a timeline.

MVP (Minimum Viable Product) The simplest version of your idea that you can test.

KPI (Key Performance Indicator) The important numbers that show if your product is doing well.

A/B Test Testing two versions to see which one works better.

Stakeholder Anyone affected by your product (users, team, leadership).

Priority/Prioritization Deciding what to build first based on importance.

Week 1: Business Terms

Once you're comfortable with Day 1 terms, add these business metrics:

Revenue, costs, and churn

MRR (Monthly Recurring Revenue) Money that comes in every month from subscriptions. → Example: 100 customers paying $50/month = $5,000 MRR → Why you care: Shows if the business is growing

ARR (Annual Recurring Revenue)
Recurring revenue expressed as an annual run rate, commonly MRR × 12. It includes recurring subscriptions billed monthly or annually. Stripe explains the calculation. → Example: 10 companies paying $12,000/year = $120,000 ARR → Why you care: Investors focus on this number

CAC (Customer Acquisition Cost) How much you spend to get one new customer. → Example: Spent $1,000 on acquisition in total, got 10 customers = $100 CAC → Why you care: If this is too high, you lose money

LTV (Lifetime Value) The estimated value of a customer over their relationship with the business. Revenue-based LTV counts revenue; profit-based LTV also accounts for costs. → Example: Customer pays $50/month for 24 months = $1,200 revenue-based LTV → Why you care: Compare it with CAC using a consistent definition of customer value

Churn Rate Percentage of customers lost during a defined period, relative to the customers at its start. → Example: Lost 5 out of 100 customers = 5% churn → Why you care: High churn means something's wrong

Burn Rate How fast a business spends cash. Net burn subtracts cash coming in from cash going out. → Example: Spending $100K/month, receiving $70K = $30K monthly net burn → Why you care: Tells you how long your money will last

Strategy Terms (How You Plan)

OKR (Objectives and Key Results) A goal and how you'll measure success. → Objective: "Get more users engaged" → Key Results: "Daily users increase from 1,000 to 2,000" → Why you care: Keeps everyone focused on the same goals

North Star Metric A primary metric intended to reflect the value users get from your product. → Other metrics help explain changes and track tradeoffs

Product-Market Fit When a product meets a strong market need. → Good sign: Users recommend it to friends → Bad sign: People try it once and never return → Why you care: This is when growth becomes easier

MMP (Minimum Marketable Product) The smallest version ready to market to its intended customers. → More polished than an MVP → Has core features working well → Why you care: Helps define the scope of an initial market launch

Week 2: Working with Engineers

These terms come up when working with your development team:

Development Terms

Agile Building software in small pieces, getting feedback, and adjusting. → Not a specific process, but a mindset → Plans adapt as the team learns

Scrum A framework with defined accountabilities and events. See the Scrum Guide. → A PM may also serve as Product Owner, but the titles are not interchangeable → Includes daily standups and sprint planning

Epic A big feature that takes multiple sprints to build. → Example: "Redesign checkout" is an epic → Gets broken into smaller user stories

Tech Debt Technical choices or accumulated design problems that make future changes harder. → Like a messy room - works now, but slows you down → Not always bad if done strategically

API (Application Programming Interface) How different software systems talk to each other. → Think of it like a restaurant menu → You order (request), kitchen makes it (process), you get food (response)

Bug Something that's broken in your product. → Priority levels: Critical (fix now) to Low (fix someday) → Teams prioritize fixes by impact and urgency

Month 1: Data and Testing

Once you're comfortable with basics, learn how to measure success:

Understanding Your Users

Conversion Rate Percentage of eligible users or visitors who complete a defined action. → Example: 100 people buy out of 1,000 visitors = 10% conversion → Why you care: Shows if your product is working

Funnel The steps users take to complete an action. → Example: Visit site → Sign up → Try product → Pay → Why you care: Shows where people drop off

Retention How many users come back. → Day 1: Did they return the next day? → Day 30: Still using after a month? → Why you care: Shows whether users continue using the product

Cohort A group of users who share a characteristic, such as when they signed up. → Example: "All users who signed up in January" → Why you care: Helps compare behavior across groups; differences alone do not establish a cause

DAU/MAU Ratio Daily active users divided by monthly active users. When using average DAU for the month, it describes average activity frequency. Amplitude explains this interpretation. → 50% means daily active users are half the monthly active count for the measured day → It does not mean the same half returns every day → A higher ratio indicates more frequent activity; whether that matters depends on the product → Why you care: Shows how "sticky" your product is

Segmentation Dividing users into groups. → By behavior: Power users vs casual users → By demographics: Age, location → Why you care: Different groups need different features

Commonly confused terms

MVP vs MMP

• MVP: Just testing if the idea works (can be very rough)
• MMP: Ready to market to its intended customers

MRR vs ARR

• MRR: Monthly recurring revenue ($5K every month)
• ARR: Annual recurring revenue, commonly calculated as MRR × 12

Roadmap vs Backlog

• Roadmap: Product direction and planned priorities, with or without dates
• Backlog: An ordered list of work under consideration

Feature vs Benefit

• Feature: What your product does ("Saves automatically")
• Benefit: Why users care ("Never lose work")

B2B vs B2C

• B2B: Selling to businesses
• B2C: Selling to individual consumers

Quick Reference: Common Acronyms

The Most Common Ones

• PM: Product Manager (you!)
• MVP: Minimum Viable Product
• KPI: Key Performance Indicator
• OKR: Objectives and Key Results
• ROI: Return on Investment
• UI/UX: User Interface/User Experience

Business Acronyms

• MRR: Monthly Recurring Revenue
• ARR: Annual Recurring Revenue
• CAC: Customer Acquisition Cost
• LTV: Lifetime Value
• GTM: Go-to-Market (launch strategy)
• B2B/B2C: Business to Business/Consumer

Technical Acronyms

• API: Application Programming Interface
• QA: Quality Assurance (testing)
• CI/CD: Continuous Integration/Deployment
• SDK: Software Development Kit

Document Acronyms

• PRD: Product Requirements Document
• SOW: Statement of Work
• POC: Proof of Concept

Your First Week of Meetings

These are examples of meeting language and schedules. Your team may use a different cadence.

Daily standup (often 15 minutes) What they'll ask: "What did you do yesterday? What's today? Any blockers?" → Keep it brief. In Scrum, this is a daily planning event for Developers to inspect progress toward the Sprint Goal, not a required PM status report.

Sprint Planning (every 2 weeks) What you'll hear: "Let's estimate these stories" → Translation: Deciding what to build in the next 2 weeks

Backlog Grooming (weekly) What you'll hear: "We need to break this down" → Translation: Making big ideas into smaller, buildable pieces

Retrospective (end of each sprint) What you'll hear: "What went well? What could improve?" → Translation: Learning from the last 2 weeks

One-on-One (weekly with your manager) What you'll hear: "How are things going? Any concerns?" → Translation: Your chance to ask questions and get help

When Terms Are Used Wrong

If you hear these, something's off:

Wrong: "Our MVP needs to be perfect" → MVPs test ideas; the quality needed depends on what you are testing

Wrong: "We need to increase ALL our KPIs" → You can't optimize everything at once

Wrong: "The roadmap can't change" → Roadmaps should adapt based on what you learn

Wrong: "We have zero tech debt" → Ask what the team counts as tech debt and how it tracks it

Your Learning Plan

Week 1: Survival Mode

1. Learn the Day 1 terms (just 10!)
2. Start a notes file for new terms
3. Ask "What does that mean?" when confused

Week 2-4: Building Confidence

1. Add 1-2 new terms each day
2. Learn your team's favorite metrics
3. Understand which terms your company uses differently

Month 2-3: Getting Fluent

1. Start using terms naturally in conversation
2. Help other new people learn
3. Build your own reference sheet

AI Prompts to Help You Learn

Use these with ChatGPT or Claude:

Learn New Terms

I'm a new product manager. 
I heard these terms today: [list the terms]
Can you explain them in simple language with examples?

Prepare for Meetings

I have a [type of meeting] tomorrow.
What PM terms might come up?
What should I know?

Connect Concepts

How do these relate to each other:
[Term 1] and [Term 2]?
Give me a simple example.

Your Personal Glossary Template

Start a document and fill this in during your first month:

TERMS I USE DAILY:
- [Term]: [What it means at my company]

METRICS WE TRACK:
- Main metric: [What we optimize for]
- My KPIs: [What I'm measured on]

OUR PROCESS:
- Sprint length: [1 or 2 weeks]
- Meeting schedule: [List regular meetings]

COMPANY-SPECIFIC:
- Terms we use differently: [List]
- Our favorite acronyms: [List]

Asking for clarification

Always ask when:

• You need to make a decision
• You're writing something important
• Different people use the term differently

How to ask:

• "Just to clarify, when you say X, what does that mean here?"
• "I want to make sure I understand - is X the same as Y?"
• "Can you give me an example of X?"

Next Steps

Practice using these terms with our tools:

1. Learn prioritization terms with our RICE scoring calculator
2. Understand revenue metrics with our MRR/ARR calculator
3. Learn unit economics with our CAC calculator