Setting Up Analytics For Customer Insights

I often read that startups need to collect user metrics from their apps and websites. Data is gold, these articles say. If companies only collected enough of it, data will help them understand their customers.

This is NOT applicable advice for startups right out the gate.

You really shouldn’t worry about analytics on day one.

Instead, when launching a new product, use the simplest analytics available:

  1. App Store and Google Play tells you the number of daily installs, uninstalls and device form factors.
  2. The simplest Google Analytics tag can be added to a website in five minutes. It will give you a rough number of visitors, where they came from, and what they’re interested in.

This is enough for a compass. Other than that don’t worry much about analytics.

  • First, you’re not likely to see enough data to make use of it anyway. Capturing usage data or analyzing patterns is only ever useful after you have users.
  • Even if you do have useful data, you can mostly use it to optimize things. Growth teams have limited revenue potential.
  • Without knowing exactly what to look for, your best guess will be to collect everything you can think of. This leads to massive datasets that you need to analyze and protect. The only thing you’ve really created is liabilities.

Listen to your customers

Your customers will tell you if something doesn’t work. The more you communicate with users, the more likely you’ll build something they want.

Then, do select exactly one KPI that will be the heartbeat for your business. Start with something simple but meaningful, such as number of monthly active users, or total sales revenue. This North Star can help answer every question for you: which feature do add? Should we hire more developers? Do we need a sales person? Whenever a new question comes up, check against the KPI and see whether it moves the needle.

Be ruthless in optimizing where you spend your time.

Statistics is a deep field, and understanding analytics is a deep subject. When starting out on a new venture, your focus is to build a real business. For that, analytics is only a distraction.


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About

Richard Dancsi

Founder & Techie

Startup founder and management consultant with over 15 years experience in building technology teams, products and companies.