Startup Phenomenon - Analytics for Startups
 

Startup Phenomenon - Analytics for Startups

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• 3. We’ll cover... 1 The data problems that startups face 2 Gateway metrics 3 4 gateways and the metrics for each ...

• 3. We’ll cover... 1 The data problems that startups face 2 Gateway metrics 3 4 gateways and the metrics for each
• 5. If you’re SaaS, track these
• 6. Use these for ecommerce
• 7. Consumer tech?
• 8. Sounds easy right?
• 9. There’s just one little problem...
• 10. You can’t track them.
• 11. You’re just getting started.
• 12. Advanced metrics are a luxury you don’t need.
• 13. Over time, your data decays.
• 14. Your data is messy.
• 15. It takes time to perfect your metrics.
• 16. Super basic version of lifetime value for SaaS
• 17. Advanced LTV formula
• 18. Let’s review the problems we face
• 19. Gateway Metrics
• 20. When picking metrics, always ask yourself: What’s my single biggest constraint right now and which metric will tell me if I’m making progress?
• 21. Why ignore other data?
• 22. Every business model is slightly different. Let’s cover the main gateways that startups face when getting traction.
• 23. Gateway 1: Is your idea any good?
• 24. Your main constraint: Getting anyone to care about your idea.
• 25. Your main metric: Can you get anyone to pay for your product or use it regularly?
• 26. Bad metrics for this gateway
• 27. Gateway 2: Is your product good enough?
• 28. Your main constaint: Having a product that’s good enough to build a business on.
• 29. Your main metric: Ask 500 users the Product/Market Fit Question
• 30. What’s the P/M Fit Question? How would you feel if you could no longer use [your product]?
• 31. Your goal for the P/M Fit Question
• 32. What about traffic, conversions, or engagement?
• 33. Gateway 3: Can you grow?
• 34. Your main constraint: Acquiring customers consistently from at least one channel.
• 35. Possible channels: 1 Inbound 2 Paid 3 Virality
• 36. Pick just one to start. Work on a single channel for 3 months.
• 37. Your main metrics: Your acquisition funnel and your main business metric.
• 38. Main business metrics: 1 SaaS 2 Ecommerce 3 Consumer Tech
• 39. SaaS Funnel:
• 40. Ecommerce Funnel:
• 41. Consumer Tech Funnel:
• 42. Why not cost per acquisition?
• 43. Gateway 4: Do you have a stable model?
• 44. Your main constraint: In order to keep scaling, you need a healthy model for your business.
• 45. Your main metrics: They depend entirely on which business model you’ve choosen.
• 46. The SaaS Model: 1 LTV is at least 3x acquisition cost 2 Recover acquisition cost within 12 months 3 Get monthly churn below 2%
• 47. The Ecommerce Model: 1 Annual repurchase rate below 40% = focus on customer acquisition 2 Annual repurchase rate 40%-60% = acquisition and loyalty 3 Annual repurchase rate above 60% = focus on loyalty
• 48. The Consumer Tech Model 1 Virality > 1 2 Usage 3 out of 7 days 3 30% users active day after signup 4 Organic growth of 100s signups/day 5 Clear path to 100,000+ users
• 49. Time to get serious with data.
• 50. How to get the data you need

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Startup Phenomenon - Analytics for Startups Startup Phenomenon - Analytics for Startups Presentation Transcript

  • Master Class: Analytics for Startups - Startup Phenomenon Lars Lofgren Growth Manager - November 2013
  • @larslofgren
  • We’ll cover... 1 The data problems that startups face 2 Gateway metrics 3 4 gateways and the metrics for each
  • Let’s start measuring!
  • If you’re SaaS, track these: 1 Monthly Recurring Revenue 2 Monthly Churn 3 Cost Per Acquisition 4 Lifetime Value 5 Signup Funnel
  • Use these for ecommerce: 1 Site Conversion Rate 2 Total Revenue 3 Average Order Value 4 Annual Repurchase Rate 5 Merchandise
  • Consumer tech? Track these bad boys: 1 Monthly Active Users 2 Daily Active Users 3 Virality 4 Engagement by Cohort 5 Activation
  • Sounds easy right? Time to jump in!
  • There’s just one little problem...
  • You can’t track them. At least not right away.
  • You’re just getting started.
  • Advanced metrics are a luxury you don’t need.
  • Over time, your data decays.
  • Your data is messy.
  • It takes time to perfect your metrics.
  • Super basic version of lifetime value for SaaS: Average Average monthly X subscription length subscription
  • Advanced LTV formula: LTV = (Average revenue per account X gross margin) monthly churn X (Monthly growth in average revenue) X (1 - monthly churn) 2 (monthly churn) *forentrepreneurs.com/saas-metrics-2-definitions
  • Let’s review the problems we face: 1 Lack of data. 2 Advanced metrics are a luxury. 3 Data decays over time. 4 Data gets messy. 5 It takes time to perfect metrics.
  • Gateway Metrics
  • When picking metrics, always ask yourself: What’s my single biggest constraint right now and which metric will tell me if I’m making progress?
  • Why ignore other data? You need to do the right things in the right order.
  • Every business model is slightly different. Let’s cover the main gateways that startups face when getting traction.
  • Gateway 1: Is your idea any good?
  • Your main constraint: Getting anyone to care about your idea.
  • Your main metric: Can you get anyone to pay for your product or use it regularly?
  • Bad metrics for this gateway: 1 Asking people if they’ll pay 2 Adwords clicks 3 Beta or waiting list signups 4 Traffic
  • Gateway 2: Is your product good enough?
  • Your main constaint: Having a product that’s good enough to build a business on.
  • Your main metric: Ask 500 users the Product/Market Fit Question
  • What’s the P/M Fit Question? How would you feel if you could no longer use [your product]? 1 Very disappointed 2 Somewhat disappointed 3 Not disappointed (it isn’t really that useful)
  • Your goal for the P/M Fit Question: At least 40% of your users should say “Very disappointed”. *Sean Ellis and Hiten Shah get credit for this one
  • What about traffic, conversions, or engagement? None of that matters (yet).
  • Gateway 3: Can you grow?
  • Your main constraint: Acquiring customers consistently from at least one channel.
  • Possible channels: 1 Inbound (Google, Content, Social) 2 Paid (PPC, Affiliates) 3 Virality (Invites, Referrals)
  • Pick just one to start. Work on a single channel for 3 months. Assume it’ll work and get the resources needed to execute.
  • Your main metrics: Your acquisition funnel and your main business metric.
  • Main business metrics: 1 SaaS: Monthly Recurring Revenue 2 Ecommerce: Monthly Revenue 3 Consumer Tech: Monthly Active Users
  • SaaS Funnel:
  • Ecommerce Funnel:
  • Consumer Tech Funnel:
  • Why not cost per acquisition? You don’t even know if you can acquire customers let alone how much it’ll cost.
  • Gateway 4: Do you have a stable model?
  • Your main constraint: In order to keep scaling, you need a healthy model for your business.
  • Your main metrics: They depend entirely on which business model you’ve choosen.
  • The SaaS Model: 1 LTV is at least 3x acquisition cost 2 Recover acquisition cost within 12 months 3 Get monthly churn below 2%
  • The Ecommerce Model: 1 Annual repurchase rate below 40% = focus on customer acquisition 2 Annual repurchase rate 40%-60% = acquisition and loyalty 3 Annual repurchase rate above 60% = focus on loyalty *Kevin Hillstrom in Lean Analytics
  • The Consumer Tech Model 1 Virality > 1 2 Usage 3 out of 7 days 3 30% users active day after signup 4 Organic growth of 100s signups/day 5 Clear path to 100,000+ users *Andrew Chen’s “Zero to Product/Market Fit”
  • Time to get serious with data.
  • How to get the data you need: 1 One team owns data quality. 2 Hire a data scientist if you need to. 3 Clean up your data. 4 Use customer analytics. 5 Tie all data back to individual users.
  • Where to find these slides: kiss.ly/startup-phenom
  • Q&A Time! Lars Lofgren llofgren@kissmetrics.com @larslofgren