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Analytics for Startups (Gaza Sky Geeks May '17)

Analytics for Startups (Gaza Sky Geeks May '17)

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Analytics for Startups (Gaza Sky Geeks May '17)

  1. 1. Andy Young // @andyy // andy@500.co How do I Analytics? a practical guide for pragmatic startups
  2. 2. Andy Young // @andyy // andy@500.co Hi, I’m Andy! @andyy #fb PhotobyDanTaylor-dan@heisenbergmedia.com
  3. 3. Andy Young // @andyy // andy@500.co Wait what, why? Analytics?
  4. 4. Andy Young // @andyy // andy@500.co What do we measure, and why? Vanity metrics Revenue metrics Conversion rate metrics Pirate metrics.. We need to know how we’re doing.
  5. 5. Andy Young // @andyy // andy@500.co If you're not keeping score there's no point playing the game - you'll never know if you're winning or not - @distrodom
  6. 6. Andy Young // @andyy // andy@500.co Today’s tools make it super-easy to track things Google Analytics Mixpanel Localytics KissMetrics Branch Metrics..
  7. 7. Andy Young // @andyy // andy@500.co Today’s tools make it super-easy to track things BUT they also make it really easy to - become overwhelmed with data - focus on the wrong things
  8. 8. Andy Young // @andyy // andy@500.co Typical analytics challenges/pitfalls Drowning in too much data Failure to select + focus on the top metrics that matter Not tracking the data you need to answer key questions
  9. 9. Andy Young // @andyy // andy@500.co Why analytics? 1. How are we doing? - are KPIs on the right track? 2. What are the results of our experiments? - so we can learn 3. What’s happening right now? - did something great or terrible just happen?
  10. 10. Andy Young // @andyy // andy@500.co How are we doing?
  11. 11. Andy Young // @andyy // andy@500.co How’re we doing? 1. Identify top-level KPI
  12. 12. Andy Young // @andyy // andy@500.co Identify top-level KPI it’s hard.
  13. 13. Andy Young // @andyy // andy@500.co Identify top-level KPI if you pick the wrong KPIs, you're screwed. If you pick KPIs and then ignore them, you're screwed. If you pick and monitor KPIs diligently, but don't assess everything you and your whole team does on the basis of whether your tasks are the most effective way to grow your KPIs, you're screwed.
  14. 14. Andy Young // @andyy // andyyoung.co How?
  15. 15. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI
  16. 16. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI Spoiler alert.. Ultimately it’s $$$
  17. 17. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI NOT revenue (that’s an output) Traction KPI leads directly to revenue
  18. 18. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI The one metric that - if it’s not growing - there’s only so long we can go kidding ourselves we’re making any progress
  19. 19. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI Keep it simple! There’s probably a pre-determined answer for how to measure your growth
  20. 20. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI Commerce: # sales Subscription / SaaS: # subscribers Marketplace: # transactions
  21. 21. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI
  22. 22. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI 2. Next, add NUANCE
  23. 23. Andy Young // @andyy // andyyoung.co Building a Growth Model Nuance metrics: help understand the full picture behind your Traction KPI E.g. for commerce: Traction KPI: # sales Nuance: average sale $; # customers
  24. 24. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI 2. Next, add NUANCE 3. Add DRIVERS
  25. 25. Andy Young // @andyy // andyyoung.co Building a Growth Model DRIVERS: the things we actually work on to grow
  26. 26. Andy Young // @andyy // andyyoung.co Building a Growth Model DRIVERS: the things we actually work on to grow E.g. for marketplaces: Traction KPI: # transactions Drivers: # suppliers, # customers
  27. 27. Andy Young // @andyy // andyyoung.co Building a Growth Model DRIVERS: the things we actually work on to grow E.g. for commerce: Traction KPI: # sales Drivers: # new customers, # repeat
  28. 28. Andy Young // @andyy // andyyoung.co Building a Growth Model DRIVERS: the things we actually work on to grow E.g. for SaaS: Traction KPI: # subscribers Drivers: # new customers, # retained
  29. 29. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI 2. Next, add NUANCE 3. Add DRIVERS 4. Add FUNNEL for each driver & loop
  30. 30. Andy Young // @andyy // andyyoung.co Building a Growth Model 1. Identify your traction KPI 2. Next, add NUANCE 3. Add DRIVERS 4. Add FUNNEL for each driver & loop end up with AARRR..
  31. 31. Andy Young // @andyy // andyyoung.co Growth Model Spreadsheet
  32. 32. Andy Young // @andyy // andyyoung.co Growth Model Spreadsheet • Review weekly - zoom out vs. zoom in • Share with whole team • Use to predict and prioritise • What to look at daily vs. weekly vs. monthly http://bit.ly/kpi-sheet
  33. 33. Andy Young // @andyy // andy@500.co Weekly/Monthly reporting % week-on-week or month-on-month growth in your One Metric That Matters Focus. Set a target. How to choose? Read this Lean Analytics post
  34. 34. Andy Young // @andyy // andyyoung.co Let’s see some examples..
  35. 35. Andy Young // @andyy // andyyoung.co
  36. 36. Andy Young // @andyy // andyyoung.co
  37. 37. Andy Young // @andyy // andyyoung.co
  38. 38. Andy Young // @andyy // andy@500.co Other key metrics CAC, LTV, churn
  39. 39. Andy Young // @andyy // andy@500.co Other key metrics Customer Acquisition Cost (CAC) how much you spend (on average) to acquire a customer Lifetime Value (LTV) How much revenue $$ an average customer brings you in all time
  40. 40. Andy Young // @andyy // andy@500.co If your LTV is greater than your CAC then you’re in business
  41. 41. Andy Young // @andyy // andy@500.co If your LTV is greater than 3x your CAC then you’re in a good business
  42. 42. Andy Young // @andyy // andy@500.co CAC & LTV: nuances Payback period: time to recoup CAC Magnitude of your numbers e.g. enterprise vs. social
  43. 43. Andy Young // @andyy // andy@500.co Calculating CAC Simple approach: total spend / total signups “50% of the money I spend on advertising is wasted - the problem is I don't know which half” - John Wanamaker Eventual goal: calculate CAC per channel
  44. 44. Andy Young // @andyy // andy@500.co Calculating LTV Problem! You don’t have a lifetime of data Measured LTV vs. estimated LTV Measure actual LTV per cohort Extrapolate revenue curve over time
  45. 45. Andy Young // @andyy // andy@500.co Calculating LTV Know your definitions! MRR?! GMV?! A16Z blog posts: 16 Startup Metrics & 16 MOAR Startup Metrics
  46. 46. Andy Young // @andyy // andy@500.co Analysing your data
  47. 47. Andy Young // @andyy // andy@500.co
  48. 48. Andy Young // @andyy // andy@500.co
  49. 49. Andy Young // @andyy // andy@500.co
  50. 50. Andy Young // @andyy // andy@500.co How not to do Metrics Outdated information Just 1 view of your data Manual calculations Bad metrics lead you astray
  51. 51. Andy Young // @andyy // andy@500.co Growth Accounting wha..?
  52. 52. Andy Young // @andyy // andy@500.co Growth Accounting
  53. 53. Andy Young // @andyy // andy@500.co Growth Accounting
  54. 54. Andy Young // @andyy // andy@500.co Cohort analysis?
  55. 55. Andy Young // @andyy // andy@500.co
  56. 56. Andy Young // @andyy // andy@500.co
  57. 57. Andy Young // @andyy // andy@500.co Getting the Datas
  58. 58. Andy Young // @andyy // andy@500.co Collecting data Don’t use Google Analytics!
  59. 59. Andy Young // @andyy // andy@500.co Don’t use Google Analytics! It’s the wrong type of tool for most key questions. Designed around sessions & pageviews Instead: focus on unique users and key actions Specific user journeys are not that important Instead: what % of unique users reached a particular step eventually? Collecting data
  60. 60. Andy Young // @andyy // andy@500.co Collecting data Use an analytics tool focused on tracking events/actions and individual user behaviour e.g. Mixpanel, Localytics, Amplitude
  61. 61. Andy Young // @andyy // andy@500.co Collecting data Events vs. Properties vs. People Events: something happened Properties: something about what just happened People: connect events to particular users (people can also have properties)
  62. 62. Andy Young // @andyy // andy@500.co What to Track?
  63. 63. Andy Young // @andyy // andy@500.co What to Track All key user behaviours ● pages/screens viewed, key actions taken ● anything that writes a new row or updates an existing row in your database or user’s session store ○ e.g. add to cart, post new content ● do you have all key steps in the user funnel? ● anything that has external impact, e.g. share
  64. 64. Andy Young // @andyy // andy@500.co Tracking events Tip #1: Choose easy-to-read and meaningful event names Short! Pick a convention; stick to it Omit superfluous words “user_viewed_homepage” “Viewed homepage”
  65. 65. Andy Young // @andyy // andy@500.co Tracking events
  66. 66. Andy Young // @andyy // andy@500.co Tracking events [Object] + [Action]
  67. 67. Andy Young // @andyy // andy@500.co Tracking events
  68. 68. Andy Young // @andyy // andy@500.co Tip #2: Track each user based on a distinct ID Don’t use email address - use autogenerated user_id from your own DB Use aliasing to connect up events tracked pre/post signup Tracking events
  69. 69. Andy Young // @andyy // andy@500.co Tip #3: Annotate your users with source data referrer; utm tags; install tracking via AppsFlyer 1. Track a signup event 2. Add as user properties 3. Potentially also as properties to key events Tracking events
  70. 70. Andy Young // @andyy // andy@500.co Tip #4: (Mixpanel specific) - People vs. Events Mixpanel won’t let you query for users who did particular events So, our options: - Do this using your own DB - Annotate your users (People) with properties for each key event Tracking events
  71. 71. Andy Young // @andyy // andy@500.co Tip #5: Ecommerce/revenue tracking Mixpanel/AppBoy etc have native support for tracking revenue Annotate your Purchase events with revenue data using the relevant properties for each platform Tracking events
  72. 72. Andy Young // @andyy // andy@500.co Tip #6: Use a development project for testing Tracking events
  73. 73. Andy Young // @andyy // andy@500.co Track events from where? Client/app vs. server Tracking events
  74. 74. Andy Young // @andyy // andy@500.co Tracking the funnel
  75. 75. Andy Young // @andyy // andy@500.co Tracking the funnel Start with the pirate metrics AARRR Top of funnel: acquisition; signups/installs Mid funnel: post-install events; engagement; retention Bottom of funnel: purchase / monetisation.
  76. 76. Andy Young // @andyy // andy@500.co Tracking the funnel Looking at each stage (AARRR) in aggregate is a good start but it will only get you so far the “truth” is much more nuanced
  77. 77. Andy Young // @andyy // andy@500.co Tracking the funnel Users acquired via different channels will have different behaviours Different cohorts will have different experiences of your product Different users will have been exposed to different A/B tests
  78. 78. Andy Young // @andyy // andy@500.co Tracking the funnel Key: these are all properties of your users UTM tags: source, medium, campaign, terms Landing page Signup time A/B test buckets Referrer Viral source
  79. 79. Andy Young // @andyy // andy@500.co Tracking the funnel Annotate your users in your database/analytics system with these attributes UTM tags: source, medium, campaign, terms Landing page Signup time A/B test buckets Referrer Viral source
  80. 80. Andy Young // @andyy // andy@500.co Let’s get Technical..
  81. 81. Andy Young // @andyy // andy@500.co Implementing Tracking Use a Tag Manager (e.g. Google Tag Manager) Check out Segment.com for flexibility & agility
  82. 82. Andy Young // @andyy // andy@500.co www.sitehound.co - Free code! -
  83. 83. Andy Young // @andyy // andy@500.co Implementing Tracking Add your Facebook + Google Custom Audience / Remarketing Pixels Now! Start building your audience
  84. 84. Andy Young // @andyy // andy@500.co Analytics = Knowledge
  85. 85. Andy Young // @andyy // andy@500.co Knowledge = power confidence sanity
  86. 86. Andy Young // @andyy // andy@500.co Good luck!
  87. 87. Andy Young // @andyy // andy@500.co ● A16Z: 16 Startup Metrics - and 16 MOAR ● Lean Analytics Book - Choosing your OMTM ● Josh Elman - The only metric that matters ● Dave McClure's Startup Metrics for Pirates ● Eric Ries’s Three Engines of Growth ● Mark Suster - Why misunderstanding startup metrics can cost you your business ● Intercom - SaaS metrics for fundraising ● Social Capital - Accounting for User Growth ● Sarah Tavel: Engagement Hierarchy-Core Actions Further references..

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