Lean analytics 40 minute intro

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    06-Sep-2014

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Upcoming Networking Events 1 Detailed Schedule and registrations as well as past session videos now available www.productleadership.in 5 things every Product Leader should know about UX July 20th, Bangalore Speaker: Jay, Head of User Experience Design Adobe Webinar: Global Customer Insights from India Product Management Can it be done? Aug 7th, Online Speaker: Muthu. R, Director Product Management, SAP Labs 5 ways in how Product Management is different in Agile July 25th, Pune Speaker: Dr. Adrian (Hong Kong), Faculty Institute of Product Leadership Implementing Lean Analytics Ben Yoskovitz @byosko 1111 2222 Basics of Analytics One Metric That Matters 3333 Lean Analytics Cycle What Well Cover 1The Basics of Analytics Analytics is the measurement of movement towards business goals. In a startup, the purpose of analytics is to iterate to product/market fit before the money runs out. http://www.flickr.com/photos/pseudonomad/5955268183/sizes/l/in/photostream/ WhatWhats a good metric?s a good metric?WhatWhats a good metric?s a good metric? Good Metrics are: 1111 Understandable 4444 Behavior Changing 2222 Comparative Active Users vs. Active Users/month 3333 Ratio / Rate % Monthly Active Users If it wont change how you behave, its a bad metric. If a metric wont change how you behave, its a http://www.flickr.com/photos/circasassy/7858155676/ http://www.flickr.com/photos/mattimattila/3822631755/ Types of MetricsTypes of MetricsTypes of MetricsTypes of Metrics Warm and fuzzy. Cold and hard. Unstructured,Unstructured, anecdotal,anecdotal, revealing, hard torevealing, hard to aggregate.aggregate. Unstructured,Unstructured, anecdotal,anecdotal, revealing, hard torevealing, hard to aggregate.aggregate. Numbers and stats;Numbers and stats; hard facts but lesshard facts but less insight.insight. Numbers and stats;Numbers and stats; hard facts but lesshard facts but less insight.insight. Qualitative vs. Quantitative Discover qualitatively. Prove quantitatively. Quantitative vs. qualitative data Do hosts withDo hosts with professionalprofessional photography getphotography get more business?more business? Do hosts withDo hosts with professionalprofessional photography getphotography get more business?more business? Airbnb experiments... Professional photography helps Airbnbs business Gut instinct Concierge MVP 20 photographers in the field Test results Two to three times more bookings! Back to the beginning Use additional data to keep experimenting 5,000 shoots / month in Feb. 2012 Historical metricHistorical metric that shows you howthat shows you how youyoure doing:re doing: reports the news.reports the news. Historical metricHistorical metric that shows you howthat shows you how youyoure doing:re doing: reports the news.reports the news. Number today thatNumber today that shows a metricshows a metric tomorrow:tomorrow: makesmakes the news.the news. Number today thatNumber today that shows a metricshows a metric tomorrow:tomorrow: makesmakes the news.the news. Try and get here.Start here. Lagging Leading vs. 2The One Metric That Matters Pick one metric that matters to your business right now. The metric will change over time, but right now you need to FOCUS. So how do you do it?So how do you do it?So how do you do it?So how do you do it? http://www.flickr.com/photos/horiavarlan/4290549806/sizes/l/in/photostream/ Your Business + Stage What business areWhat business are you in?you in? What business areWhat business are you in?you in? What stage areWhat stage are you at?you at? What stage areWhat stage are you at?you at? E-Commerce SaaS Free Mobile App 2-Sided Marketplace Media User-Generated Content Empathy Stickiness Virality Revenue Scale GROWTHRATEGROWTHRATEGROWTHRATEGROWTHRATE Lean Analytics Stages IIve found a real, poorly-met need that ave found a real, poorly-met need that a reachable market faces.reachable market faces. IIve found a real, poorly-met need that ave found a real, poorly-met need that a reachable market faces.reachable market faces. IIve figured out how to solve the problemve figured out how to solve the problem in a way they will adopt and pay for.in a way they will adopt and pay for. IIve figured out how to solve the problemve figured out how to solve the problem in a way they will adopt and pay for.in a way they will adopt and pay for. IIve built the rightve built the right product/features/functionality that keepsproduct/features/functionality that keeps users around.users around. IIve built the rightve built the right product/features/functionality that keepsproduct/features/functionality that keeps users around.users around. The users and features fuel growthThe users and features fuel growth organically and artificially.organically and artificially. The users and features fuel growthThe users and features fuel growth organically and artificially.organically and artificially. IIve found a sustainable, scalableve found a sustainable, scalable business with the right margins in abusiness with the right margins in a healthy ecosystem.healthy ecosystem. IIve found a sustainable, scalableve found a sustainable, scalable business with the right margins in abusiness with the right margins in a healthy ecosystem.healthy ecosystem. Gates needed to move forward EMPATHYEMPATHYEMPATHYEMPATHY STICKINESSSTICKINESSSTICKINESSSTICKINESS VIRALITYVIRALITYVIRALITYVIRALITY REVENUEREVENUEREVENUEREVENUE SCALESCALESCALESCALE Stage: Empathy / Stickiness Model: E-Commerce Eco-friendly prints of your photos Originally tied specifically to Instagram and built a custom InstaOrder feature Jumping the gun on product development Optimize for 1st time orders or repeat purchases? 2x transactions lower bounce rate sign-in goals increased with InstaOrder Click checkoutClick checkoutClick checkoutClick checkout Sign into PayPalSign into PayPalSign into PayPalSign into PayPal Confirmation pageConfirmation pageConfirmation pageConfirmation page Confirm orderConfirm orderConfirm orderConfirm order Back to PayPalBack to PayPalBack to PayPalBack to PayPal Authorize pre-Authorize pre- approved paymentsapproved payments Authorize pre-Authorize pre- approved paymentsapproved payments Success pageSuccess pageSuccess pageSuccess page without InstaOrder Click checkoutClick checkoutClick checkoutClick checkout Sign into PayPalSign into PayPalSign into PayPalSign into PayPal Confirmation pageConfirmation pageConfirmation pageConfirmation page Confirm orderConfirm orderConfirm orderConfirm order Success pageSuccess pageSuccess pageSuccess page skip steps at yourskip steps at your own riskown risk skip steps at yourskip steps at your own riskown risk Six sample business models E-commerce SaaS (freemium?) Mobile app (gaming) Two sided marketplace Media User generated content The SaaS Customer Lifecycle Customer Acquisition Cost paidpaid directdirect searchsearch womwom inherent virality inherent virality VISITORVISITORVISITORVISITOR Freemium/trial offerFreemium/trial offerFreemium/trial offerFreemium/trial offer EnrollmentEnrollmentEnrollmentEnrollment UserUserUserUser Disengaged UserDisengaged UserDisengaged UserDisengaged User CancelCancelCancelCancel Freemium churn Engaged UserEngaged UserEngaged UserEngaged User Free user disengagement ReactivateReactivateReactivateReactivate CancelCancelCancelCancel Trial abandonment rate Invite OthersInvite OthersInvite OthersInvite Others Paying CustomerPaying CustomerPaying CustomerPaying Customer Reactivation rate Paid conversion FORMER USERSFORMER USERSFORMER USERSFORMER USERS User Lifetime Value ReactivateReactivateReactivateReactivate FORMER CUSTOMERSFORMER CUSTOMERSFORMER CUSTOMERSFORMER CUSTOMERS Customer Lifetime Value Viral coefficient Viral rate ResolutionResolutionResolutionResolution Support data Account CancelledAccount CancelledAccount CancelledAccount Cancelled Billing Info Exp.Billing Info Exp.Billing Info Exp.Billing Info Exp. Paid Churn Rate Tiering Capacity LimitCapacity LimitCapacity LimitCapacity Limit Upselling rate UpsellingUpsellingUpsellingUpselling DisengagedDisengagedDisengagedDisengaged DissatisfiedDissatisfiedDissatisfiedDissatisfied Trial OverTrial OverTrial OverTrial Over One Metric That Matters. One Metric That Matters. How It All Comes Together The business youThe business youre inre inThe business youThe business youre inre in E-Com SaaS Mobile 2-Sided Media UCG Empathy Stickiness Virality Revenue Scale ThestageyouThestageyoureatreatThestageyouThestageyoureatreat Stage: Scale Model: SaaS SEO toolkit (product suite) Reduced KPIs to focus on Net Adds Moz reduces the KPIs it tracks If Net Adds:If Net Adds:If Net Adds:If Net Adds: Why & Next Steps:Why & Next Steps:Why & Next Steps:Why & Next Steps: Net Adds = business health indicator Was a marketing campaign successful? Were customer complaints lowered? Was a product upgrade valuable? Can we acquire more valuable customers? What product features can increase engagement? Can we improve customer support? Are the new customers not the right segment? Did a marketing campaign fail? Did a product upgrade fail somehow? Is customer support falling apart? Whats your OMTM? Empathy Stickines s Virality Revenue Scale E- commerce SaaS Media Mobile app User-gen content 2-sided market Interviews; qualitative results; quantitative scoring; surveysInterviews; qualitative results; quantitative scoring; surveys Loyalty, conversion Loyalty, conversion CAC, shares, reactivation CAC, shares, reactivation Transaction, CLV Transaction, CLV Affiliates, white-label Affiliates, white-label Engagemen t, churn Engagemen t, churn Inherent virality, CAC Inherent virality, CAC Upselling, CAC, CLV Upselling, CAC, CLV API, magic #, mktplace API, magic #, mktplace Content, spam Content, spam Invites, sharing Invites, sharing Ads, donations Ads, donations Analytics, user data Analytics, user data Inventory, listings Inventory, listings SEM, sharing SEM, sharing Transaction s, commission Transaction s, commission Other verticals Other verticals (Money from transactions) Downloads, churn, virality Downloads, churn, virality WoM, app ratings, CAC WoM, app ratings, CAC CLV, ARPDAU CLV, ARPDAU Spinoffs, publishers Spinoffs, publishers (Money from active users) Traffic, visits, returns Traffic, visits, returns Content virality, SEM Content virality, SEM CPE, affiliate %, eyeballs CPE, affiliate %, eyeballs Syndication, licenses Syndication, licenses (Money from ad clicks) 3The Lean Analytics Cycle Follow the Lean model, and it becomes increasingly hard to lie, especially to yourself. Instincts are experiments. Data is proof. Identify a key business problem, pick the OMTM, and get started. Pivot or give up Try again Success! Measure the results Make changes in production Design a test Hypothesis With data: find a commonality Without data: make a good guess Find a potential improvement Draw a line in the sand Pick the OMTM The Lean Analytics Cycle Draw a new line Did we move the needle? Some interesting benchmarks Growth 5% / week (revenue or active users) Churn 2% / month Engaged visitors 30% monthly users 10% daily users Time on site 17 minutes Page load time < 5 seconds CLV:CAC 3:1 Mobile file size < 50MB Free to paid 2% of free users byosko@gmail.com @byosko ORDER! follow me. instigatorblog.com leananalyticsbook.com subscribe. email me. Thank you! 39 Have an idea? Have a suggestion on the speaker/topics? Want to know about product events? LinkedIn Group Adaptive Marketing engage@productleadership.in www.productleadership.in