Identifying weaknesses in your startup
Metrics for growth.
To grow your startup you must be able to identify and prioritise areas of weakness. Measuring metrics is a useful way to do this. By leveraging these metrics, you can: identify, prioritise and investigate weaknesses; design and test hypotheses, and measure the results.
Here is a set of high-level stages of the customer journey, with example metrics that you should consider. By considering metrics that represent each of these stages, you’ll be able to spot weaknesses in your startup.
Your customer knows about your brand. Examples: seen an advertisement, read an article, listened to a podcast, referred by a friend, visited your site.
Measure: ad impressions, social impressions, podcast subscriptions, site visits.
Your customers perform a transaction. Examples: signing up for a newsletter, inputting their email to download a white paper, having a live chat, contacting you for more details.
This shows more investment from your customer and often affords the ability to contact them via email (assuming valid consent has been recorded).
Measure: email signups, live chat sessions, information requests.
Your customer tries your product. Examples: a free trial of a SaaS, a small/loss-leader purchase, a free consultation.
To succeed, offer a great experience that enables your users to realise your value proposition immediately. If you fail, they’re unlikely to return.
Measure: signups, loss-leader sales, consultations.
Your customer pays for your product. Examples: SaaS subscription, up-sells, contracts signed.
Measure: trial to paid conversions, first purchases.
Existing customers continue to buy from you. Examples: continued subscriptions, further purchases, retainers.
Once you’ve spent the effort (and money) building trust with your customer, it is much cheaper to get them to buy again, rather than to sell to a new customer.
Measure: customer lifetime value, churn rates.
Customers introduce their friends and networks to your brand.
Systems which encourage referrals have proven to be extremely beneficial for growth. Examples: Dropbox, Facebook.
Measure: referrals, social shares, proxy metrics (surveys).
Identifying weakness with data
Use each of these areas as a guide for your business. They offer a high-level overview of your customer journeys enabling you to identify areas of weakness.
Each segment is different
Segmenting your data will help you to understand performance across different groups of people. Example: by segmenting by origin channel, such as Facebook Ads, you’ll likely find that one channel outperforms others.
Don’t be tricked by the numbers
Poor performance within an area isn’t necessarily caused by deficiencies in that area. Example: poor metrics within the activation stage may be caused by bad targeting within the awareness stage.
Data tells our stories
Each metric represents interactions of real people with your brand. When you’re exploring weaknesses try to understand the customers that your metrics represent. Example: if your product is designed to help an expectant mother through her pregnancy there’s no point trying to optimise retention past 9 months… unless we’re talking about an elephant.
What are your barriers to growth?
These metrics give you the opportunity to explore the answers to this question — you’d be surprised how many businesses “don’t really know”.
I want to tailor my articles to you, so please let me know what barriers you find.
Build the future
Data affords you the opportunity to better serve your customers. To achieve this, you must use these metrics to: identify, prioritise and investigate weaknesses; design and test hypotheses, and measure the results. It’s a continuous process that aims to deliver continuous improvement.