Analytics Tips for Early Stage Startups

By Jason Thompson, co-founder, 33 Sticks
 
barchart_256pxAll the tips I can offer will mean little if startups are unwilling to properly invest in analytics.
 
Many early stage startups, being in the 1-10 employee range, often understand the important of analytics yet, for many different reasons, don’t properly invest in analytics.
 
Investing in analytics does not mean deploying Google Analytics, setting up a few automated reports, and forgetting about it.
 
Investing in analytics does mean investing in time and people. While many early stage startups don’t have the luxury of hiring a full-time analyst, a small investment in outside help can produce huge returns. Also, startups should allocate time for data curious employees to dive into the data in order to produce insights and recommendations.
 
Tip #1 – Analyze Marketing Spend
 
One of the biggest mistakes I see startups making is investing in marketing campaigns without measuring the results. Many marketing campaigns on the surface may look successful i.e. ‘hey, that Facebook campaign sure did drive a lot of traffic to our site!’ but underneath are bleeding money. Analyzing the success of marketing campaigns through an in-depth understanding of conversion rates, total acquisition costs, and lifetime value, is critical. Not only will investing time in analyzing the effectiveness of marketing spend prove to be a cost saving activity, it also has the added benefit of producing more targeted and efficient content which will ultimately increase conversion and revenue.
 
Tip #2 – Make Use of Product Analytics
While investing in the top part of the customer acquisition funnel is vitally important, it is just as important to invest in renewal portion of the funnel.
 
Many of the startups I work with have at least instrumented data collection on their customer acquisition websites, yet they have failed to instrument data collection within their product.
 
Product analytics is critically important for understanding things like:
 

  • Knowing when to ask a customer to upgrade from a free to a paid account
  • Flagging customers who are at risk for not renewing
  • Providing insights to the product team on potential enhancements
  • Identifying things that your most valuable customers do and how you can get other customers to do those things

  

Tip #3 – Always Be Optimizing
My final tip is to make use of free or low cost optimization platforms such as Optimizely. There is a commonly held belief that startups, typically due to low traffic volumes, can not do optimization. That belief is false. Anyone can test and SHOULD be testing.
 
Do you want to really move the needle? Make use of the insights produced from analyzing marketing spend to test personalized landing pages and conversion funnels.
  
NOTE: This article was originally published on LinkedIn.