Startup Analytics- Being an entrepreneur is one of the toughest jobs in the world. They might face ups and downs and unexpected turns in life. These unexpected situations have urged the entrepreneurs to make use of the startup analytics. The term startup analytics looks so confusing specially with the terms like “growth hacking” and “lean startups” . But it is not intimidating as it looks. Entrepreneurs can find the startup analytics more useful and comfortable. Startup analytics is more logical and rational.
Startup analytics contains two important elements – Metrics and Analytics. Let’s look in detail about these elements in this article.
- What is analytics ?
Analytics measures the movement of your business towards its goals.
- What is metrics ?
Metrics are the measurements which are needed to progress towards your defined business goals.
What makes a good metric ?
- A metric must be comparable with the previous data acquired.
- Metric should be easy to understand and people should understand what is measured through the metrics
- A metric should be actionable and it should help you to make a decision
- The metric should be a ratio or a rate
- Good metrics should change if there is any change in your business or defined goals
Why metrics is important?
- Metrics are the logical startups for any business. They help startups to setup goals.
- Metrics help the entrepreneurs to make smart decisions about their startups.
- Without metrics it is impossible to progress towards the goals
- Metrics helps to identify trends and patterns and problematic areas in business
- Before making any important decision startup will consult the metrics if it is the right time to take the decision
- Progress is the important reason behind using metrics. Without metrics it is difficult to know where there is a problem or risk in business
Types of Metrics
The two types of metrics are qualitative and quantitative;
Qualitative is direct contact with the customers for example customer interviews or feedback. This feedback is considered more valuable to the metrics.
Quantitative is the numbers which you get.
You get an information qualitatively and convert them into quantitative.
Under these two main types of metrics comes other metrics such as
- Vanity Metrics – These metrics do not change the way you behave but it makes you feel good
- Actionable Metrics – These are the ones that changes the way you act
- Exploratory Metrics – These metrics helps to find out the information which were so long unknown or buried
- Reporting Metrics – These metrics tells you how the business is performing
- Lagging Metrics – Lagging metrics gives you some historical information
- Leading Metrics – This helps you to predict the business happenings
Most of the startups use the lagging metrics as they are in the growing stage.
What metrics should be used where ?
There is a popular question, what metrics should be used at every stage of startups ? But there is no one definite answer. This is because it depends on the type of product and your business.
If you are new to the market then you can very well go with engagement metrics. Through this metrics you can get the feedback of the users. This metric also known as churn. Once you feel that your product is successful then you can go ahead with growth metrics.
Growth metrics are the most useful but what type of growth metric you use purely depends on your goals and business. You should find out the most important growth metric for your business and should focus on it.
The bottom line is every startup is different for every entrepreneur. There is no one definite metric flow to be used for the stages of startups. It changes according to the goals and plans of the business.
Working with Metrics and Analytics
There are different metrics framework for example Pirate Frameworks. But before we start working up with such metric frameworks we should know the basics of measuring data and converting them into useful information.
Metrics and analytics are very difficult to handle with. If used properly it will take to business to a high level and if it is used improperly then it will easily drown your data.
If you don’t learn the basics then metrics will not give you accurate results.
Startup analytics needs both Google Analytics and KISSmetrics.
While Google Analytics focuses on “What” and KISSmetrics focuses on “Who”.
How to use Google Analytics
Google analytics helps to track and report your website traffic. It provides a deeper knowledge about the site visitors, their behaviour, the result of a particular SEO campaign and a lot of other things. The data collected through Google analytics gives you an overall view about how your site is performing and what are the areas which needs improvement to make your site work better for you.
Let’s see how to get started with Google Analytics;
Installation and Setup
Setting up a Google Analytics account is really simple. If you have an existing Gmail account it becomes more easy.
To create an account go to Google Analytics Website and click on the button “Access Google Analytics”. You will be directed to your account. It appears as shown in the picture below
Select the thing which you want to track and select a tracking method. If you are a new user then classic analytics is the best to use. Give your website name, URL and the category to which your business belongs. After entering all the details click “Get Tracking ID”
You can insert this tracking code into your website before closing the </head> tag.
This account should be accessed only by you. You can also let other people to access your account but the full control should not be transferred for safety reasons.
Manage your site search
You can set up site search to know what the visitors are looking in your site. For doing this go to View Settings and turn on your site search tracking. Enter your website name, URL and query parameter. The query parameter will either be s or q.
Advanced segments are easy to set up in Google Analytics and it will help you to segment the data, visitors and traffic based on their types or categories. For example if you want to view the data about the visitors who are arriving at your site from any social network like Facebook you can use this option.
To use this option click on the drop down menu which is present to the left of the “All Visits” and select the segment which you want to apply this to and now you are done.
Goals are very important for startup analytics. Metrics will help to tell you how much is your progress towards your defined goals. So Google Analytics goals plays a very crucial role.
To set up a goal Click the Admin button à View à Goals.
Create a New Goal and then to customize it go to “Goal Setup” à Custom.
In this step you can give a name to your goal and select a destination for the goal. You can add an Event tracking to your goal in order to measure it.
Google analytics has four types of Goals – Revenue, Acquisition, Inquiry and Engagement. Each type of goal has its own characteristics and requirements. It can be customized as per your business need.
The maximum number of goals which you can create in Google Analytics is 20.
If you wish to track something in your website then you can set up events in Google Analytics. Events are related to how the visitors interact with your site. Event set up need some coding to be done. The code you add to the events depends on the type of analytics you choose – Universal or classic.
Event set up requires some effort and time from your side but it is really worth doing. Events help in getting the data which you wanted from Google Analytics
Starting up with KISSmetrics
Let’s see how to use KISSmetrics
Installation and Setup
- Install the tracking script under <head> tag of every page
- After installation wait for 30 minutes for the script to start tracking. An email notification will be sent once the script becomes active.
- In the mean time decide about the events you want to track and how to create the custom events based on your business needs.
When you use JS library make sure that you don’t have any problems with Google Analytics on your site.
Once an event is created it takes around 2 to 6 hours to get the KISSmetrics reports.
Tracking Campaign URL’s
If you want to launch a successful marketing about your startups then you need to have some campaign URL’s. It can be of any type like email campaigns or Adwords campaigns or any other campaigns. You should also manage such campaign URLs properly.
- UTM variables – KISSmetrics library will read such URLs and creates an event. Such type of URLs are easy to set up
- URL API – This type lets you to tag a link. Anyone who follows that link will create an event.
- DIY – Final one is building up a custom solution for yourself which requires a lot of time and effort.
Integrating with External tools
The main advantage of using KISSmetrics is that it can be integrated externally with ease. You can include data from a lot of other sources like Marketo, Stripe, Chargify and many more. The process is very simple and unique.
KISSmetrics is very useful specially when the startups depend on multiple platforms.
Best practices of Startup Analytics
Lean Startup Analytics
Lean startup is the best method which helps you to learn how to steer, when to turn and how to grow a business with maximum effort. It is the scientific approach to create and manage startups. Lean startups helps to deliver the desired product to the customer’s hands quicker and better. It is the best approach towards new product development. Companies using the lean startup analytics can provide tools to test a vision on a continuous basis. Given below is the lean analytics framework.
The meaning for different stages of Lean analytics are explained in the diagram below.
Move from Big Picture to Small Picture
How do you find which analytics you should choose and what metrics will be of more help to you ?
The trick here to find the solution is to work from big picture to a small one. For example say your main motive is to get lot of registered users on your site then whatever you do should be tied up in making the users to do a free signup on your site.
Always do not imitate the other entrepreneurs. One entrepreneur might be in an established position but you might be in the starting stage. And if you copy the startups of such larger companies when you are at a growing stage it will definitely not work out for you.
Pirate Metrics (AARRR)
This is the important type of metric followed these days. The expansion of AARRR is
A (Acquisition) – Relates to how visitors reach your site
A (Activation) – How is the user experience on your site for the first time
R (Retention) – Number of visitors who return to your site
R (Referral) – How many visitors refer your site to others
R (Revenue) – Monetization of your site
All these factors conclude only these three things – Get users, make usage and finally make money out of it.
If you keep on testing you will find your site work better and faster. Even a small change in your site could make you get more profit. Start testing your site using multivariate tests and finally choose which suits best for you. Test your site more frequently and this is the best actionable metrics.
Thus Startup analytics comes into the scene when there are lot of ups and downs in the business. It helps you to predict the business situations and make smarter decisions. It will help your business grow and move forward. More importantly they will help you to avoid the downs in the business.