Measure or die! Tetuan Valley Barcelona, Fall 2014
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Measure or die! Tetuan Valley Barcelona, Fall 2014
- 1. Metrics: because everything counts Justo Hidalgo @justohidalgo Tetuan Valley Startup School Fall December 1st, , 2014
- 3. Hi! ■ Co-founder, • Business Dev, Data Analytics ■ Data Integration and Management, Product Strategy and Innovation ■ Ph.D. in Computer Science on Data Integration and Web Automation ■ Ergo: Love Data ■ @justohidalgo
- 4. A service to read and discover digital books that works on any device
- 6. My goals today Metrics Conclusions Eat pizza
- 7. Metric ■ A metric is a number. ■ PERIOD ■ OK, a Count or a Ratio. ■ But a number. ■ PERIOD 7
- 8. AARRR Acquire Activate Retain Refer Get Revenue SEO SEM Campaigns Email Blogs … Landing Page Product Features … Content (blogs, articles, …) Emails Alerts … Campaigns Emails … Shopping cart Subscriptions Lead Gen … traffic social business
- 10. Acquisition How do people find your site?
- 11. @justohidalgo
- 12. @justohidalgo
- 17. 15 seconds in “La 1”
- 18. Metrics Number of visits Distributions (per browser, region, …) Number of page views Bounce rate
- 19. AActivation How sticky is your site?
- 25. Metrics # Sign ins!!! Recency (time since user did 85000 80000 75000 70000 65000 60000 55000 50000 45000 40000 something meaningful) Time per page Time on site (and churn as well!!!)
- 26. Biggest Apple Reseller in Spain 1-year subscription to 24s per iPad/Mac purchased @justohidalgo
- 28. AARetention Why do users come back?
- 32. 32
- 34. Metrics. The standard ones… Number of unique/returning visitors Visits over time Average session time
- 35. … engagement… D/WAU: Daily/Weekly Active Users MAU: Monthly Active Users Stickiness = D/WAU MAU
- 36. … but also domain-specific!!! # Active readers # Books read per user Pages read per active reader per month Pages read per paid user per month
- 37. Social Metrics
- 38. AARReferral Do people talk about your site?
- 41. Virality Amplification rate: • (#shares, #RTs, …) K-Factor = AR * conversion rate • = 1: steady state • > 1: growth ➤ 1.4 < x < 2.1 => hot & viral!!! • < 1: decline
- 42. @justohidalgo
- 43. Business Metrics
- 44. AARRRevenue Do you make money?
- 45. MOBILE CARRIERS 24s or White Label D2C 24symbols.com
- 46. Lifetime Value = LTV ARPU * 100% Churn rate Source: http://blog.kissmetrics.com/how-to-calculate-lifetime-value/
- 47. Customer Acquisition Cost CAC Ratio= gross margin per customer sales/marketing costs per customer Bessemer: average ratio of SaaS companies = 0.6
- 48. LTV vs CAC Of course, LTV > CAC But, moreover: LTV > 3x CAC
- 50. Conclusions
- 52. @justohidalgo
- 53. 2. Have someone taking care of it
- 54. DATA SCIENCE SO EASY A CAVEMAN CAN DO IT #ELS2014
- 57. AND NOW… BUSINESS-SAVVY!!! @justohidalgo
- 58. 3. Only measure what you truly care about @justohidalgo
- 59. But again, choose right
- 60. 4. Don’t be data-driven… … be data-informed… #ELS2014
- 61. … but VERY DATA-INFORMED! #ELS2014
- 62. 5. Beware vanity metrics…
- 63. … they may hide an awful truth
- 64. Thanks for your time! Justo Hidalgo http://www.loscuentosdelabuelo.com jhidalgo@24symbols.com @justohidalgo
- 65. Credits Olivier Guin, from The Noun Project Dima Yagnyuk, from The Noun Project Redesign from Otl Aicher’s icon, from The Noun Project Axsys, from The Noun Project Monika Ciapala, from The Noun Project Rob Schill, from The Noun Project Martin Karachorov, from The Noun Project Alexandre Mendes, from The Noun Project All other icons from The Noun Project Publishers trademarks, logos and brands belong to their respective companies.
Editor's Notes
- Based on Dave McClure’s AARRR metrics model (http://500hats.typepad.com/500blogs/2007/09/startup-metrics.html)
- http://www.flickr.com/photos/hktang/4243300265/
- How you bring people to your site SEO, SEM, Social Networks, Blogs, Email, … Find those channels that bring you the LARGEST QUALIFIED volume, at the LOWEST cost with the best PERCENTAGE
- And (3) by searching for alternative channels. I’ll mention two of them. K-Tuin is the biggest Apple reseller in Spain, and they’re currently offering a 1-year subscription to 24s to every Mac or iPad buyer. Another one is the deal we’ve reached with a major telco in Spain to offer a similar subscription to their new customers coming from portability.
- How to make your users coming back Automated emails As personalized as possible… but up to a limit Non intrusive (easy to unsubscribe) As less commercial-ish as possible
- This is related to the retention stats: active readers in our case. Stickyness is quite related to social gaming. Don’t expect the same degree of stickyness as Facebook or Zynga!!! This is more profound that “try to keep it high” Facebok’s ratio seems to have been > 50% all of the time Amazon’s seems to be around 17% 24symbols is between 6 and 10% right now. Games and communication apps should have a high ratio as well E-commerce and other categories have a much lower ratio http://www.flickr.com/photos/lucasjames123/5040993203/
- http://www.flickr.com/photos/anirudhkoul/3786725982/
- http://www.flickr.com/photos/twenty_questions/2192450204/
- http://www.flickr.com/photos/76657755@N04/6921689726/
- divide the NEW annualized net gross margin added during the quarter (gross new CMRR x your average Gross Margin % x 4 quarters; forget the effect of churn for now), by the sales and marketing costs of the previous quarter excluding any account management costs attributed to your "farmer" organization
- http://nirvacana.com/thoughts/becoming-a-data-scientist/
- http://rlv.zcache.com/little_unicorn_with_pink_mane_tie-r63d74334bf074562988a6286e0081cdb_v9whb_8byvr_324.jpg
- http://www.flickr.com/photos/qualityandstyle/4628275080/ Ockham’s razor, also spelled Occam’s razor, also called law of economy or law of parsimony, principle stated by William of Ockham (1285–1347/49), a Scholastic, that Pluralitas non est ponenda sine necessitate, “Plurality should not be posited without necessity.” The principle gives precedence to simplicity; of two competing theories, the simpler explanation of an entity is to be preferred. The principle is also expressed as “Entities are not to be multiplied beyond necessity.” All metrics are ACTIONABLE If you don’t plan to do anything with a metric, DON’T MEASURE IT! i.e. Don’t waste your valuable and limited time Kill useless metrics.