Analytics and Startups

Author: Notre Dame ESTEEM

Analytics for Entrepreneurs

Startups are highly focused on numbers. Not just number of products but delving deeper into who, what, when and why people are buying. Analytics are changing the way small companies can understand the market in a way that only large companies used to be able to understand. Market research is a huge tool for not only making the best product but once your product is made, reaching the exact targets you want to reach. Here are examples of how to gather analytics and why it's important. 

First it's important to realize that in order to even use analytics you need a user base that is large enough to be statistically significant - if 5 people went to your site and 2 got there from Facebook, 1 got there from search and the other two got there from other sources, it doesn't really tell you anything; it shouldn't change the way your company markets or where it focuses its time. Imagine however, if you have 10,000 people using your online product and 8,000 got there from Facebook - that is enough to begin making marketing decisions off of and possibly make product integration decisions from. However, analytics are not just coming from Google's web tracking analytics, there are plenty of other products you can use to better understand your clients and understand your targets through testing. 
Testing is often done by putting out multiple variations of a product (A/B testing) to see which one gets better measurable results. For example: if you have a web app you might test two different home screens to see which one gets more people to convert to signing up, and if that conversion rates is statistically different enough to make a difference. Again, if you had 10,000 views and only had a difference of 200, it's not necessary to make changes however, if instead you had 10,000 views and a difference of 1,000-2,000 views, changes should probably be made to reflect the results. This testing can optimize your work and help you better understand what your customers are looking for. This testing will help you understand whether or not you should make changes to products or if you should simply stop something you are doing completely. 
Minimum viable products are a great way of testing the market as well. Put out something that you can get out quickly and easily to see if people want to use it, and, if they do want to use it, find out at what point they begin running into issues. Still using an application idea, if people are showing a desire to try the product it might demonstrate demand (depending again on size of market and other factors), and then once they are working with the application, you should look for where they begin getting held up or at which point do they simply leave (bounce rate). These tests are important and the results are important for understanding what you need to improve or even to simply see if your idea is even viable on the market place. 
With this short intro into analytics and testing, let us know what tools you use and what you want to understand better about analytics!  
Other posts about Entrepreneurial Skills:

4 Tips on Building a Company with Staying Power

4 Tips on Fostering Culture

Having a Vision for Entrepeneurs