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A quick review of Lean Analytics by Ben Yoskovitz and Alistair Croll. Presented at Singapore Lean Startup Circle.
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Lean AnalyticsBringing Back the
Book Report
Presented at Singapore Lean Startup Circle
April 10, 2013
Hello!● Product guy● Mix of corp and startup● 5+ years in SEA● Yahoo Product Marketing● Pollenizer SEA GM● @sonofsarah
1980
2000
Dot Com Boom (1997 - 2000
Dot Com Crash (2000 - 2001)
...
Toyota
2010
Steve Blank - 4 Steps to the Epiphany (2005)
Lean Startup "coined" (2008)
The Lean Startup (2011)
The Lean Startup @ SXSW (2012)
The Lean Startup Conference (2012)
Lean 2.0 - The Growth of a Management Science?
Pre History
Lean Startup 1.0
Lean Startup 2.0Lean Analytics (2013)Lean UX (2013)
Image Credit - http://brendanmarsh.com/lean/the-lean-startup-validation-board/
Lean Analytics in a Slide
Small Batch Production
A/B TestingCohort Analysis Funnel Analysis
5 Stage Lifecycle
Startup Life Cycle Actionable Metrics
Business Model Types
Lean Principles
Analytics for Lean
Lean Analytics
CASE STUDIES and EXAMPLES
OMTM Benchmarking
Refresh - Actionable Metrics
Small Batch Production
A/B TestingCohort Analysis Funnel Analysis
5 Stage Lifecycle
Startup Life Cycle Actionable Metrics
Business Model Types
Lean Principles
Analytics for Lean
Lean Analytics
CASE STUDIES and EXAMPLES
OMTM Benchmarking
● Must go up over time
● NOT comparative
● Often a simple total
● Typically not granular
● Focused on story telling
● Not directly tied to biz. health
Vanity Metrics Actionable Metrics
EXAMPLES
● Total downloads
● FB likes
● Registered users
● Enables comparison
● Often a ratio
● Often cohort based
● Drives decision making
● Can answer the question "did that
experiment work"?
EXAMPLES
● Conversion or retention rate
● Churn rate
● Shopping cart size
The 6 Startup Business Models
Small Batch Production
A/B TestingCohort Analysis Funnel Analysis
5 Stage Lifecycle
Startup Life Cycle Actionable Metrics
Business Model Types
Lean Principles
Analytics for Lean
Lean Analytics
CASE STUDIES and EXAMPLES
OMTM Benchmarking
- CAC - Conversion rate - Cart size - Return purchase - LTV (or Payback)
E Commerce
- CAC - Engagement - Free/paid conversion - Churn - LTV
SAAS
- CAC - MAU - Free/paid conversion - Churn - ARPU
Free App
- MAU - Engagement - PV (or equivalent) - CTR - CPM
Media
- MAU - Engagement - % Creators - CTR - CPM
UGC (Social)
- Inventory (Supply) - Buyers (Demand) - Search Effectiveness - Ratings
Marketplace
Takeaway - Know your funnel!
The 6 Startup Business Models
The Lean Analytics Stages
Small Batch Production
A/B TestingCohort Analysis Funnel Analysis
5 Stage Lifecycle
Startup Life Cycle Actionable Metrics
Business Model Types
Lean Principles
Analytics for Lean
Lean Analytics
CASE STUDIES and EXAMPLES
OMTM Benchmarking
The Lean Analytics Stages
EMPATHY
STICKINESS
REVENUE
VIRALITY
SCALE
Takeaway - Know your stage (but feel free to use other terms)
One Metric That Matters
Small Batch Production
A/B TestingCohort Analysis Funnel Analysis
5 Stage Lifecycle
Startup Life Cycle Actionable Metrics
Business Model Types
Lean Principles
Analytics for Lean
Lean Analytics
CASE STUDIES and EXAMPLES
OMTM Benchmarking
● Pick one metric that is critical to biz health
● Focus the team around it (put it on screen!)
● Optimize the hell out of it
● Pick a new metric as biz grows and changes
One Metric That Matters
Case Study - Wooboard OMTM
PHASE METRIC TYPE METRIC
Is there a problem? User Interest Company sign ups
Do we have a solution? Engagement Woos per user
Is there a market? Revenue % of premium conversions
This is a classic SaaS OMTM progression. See also Backupify.
● Phase 1 - site visits● Phase 2 - trials● Phase 3 - monthly recurring revenue
Case Study - Wooboard OMTM
Takeaway - Pick an OMTM (or at least get data focused)
"The core idea behind Lean Analytics is this: by knowing the kind of business you are, and the stage you are at, you can track and optimize the One Metric that Matters to your startup right now."
- B Yoskovitz and A Croll
Benchmarking
Small Batch Production
A/B TestingCohort Analysis Funnel Analysis
5 Stage Lifecycle
Startup Life Cycle Actionable Metrics
Business Model Types
Lean Principles
Analytics for Lean
Lean Analytics
CASE STUDIES and EXAMPLES
OMTM Benchmarking
Some Benchmarking Examples
Conversion - expect 2% - aim for 10%
Cart abandonment- expect 65%!
E Commerce
Free trial - request card - 2% try, 50% buy
Free trial - no card - 10% try, 25% buy
Monthly churn - < 5% for growth - < 2% for scale
Growth - increase customer revenue by 20% a year - upsell 2% of users/month
SAAS
App size - stay below 50MB to avoid download drop off
App CAC - Shoot for $.50 to $.75 - make sure CAC is less than LTV!
Conversion - free to aid - 2% - In app purchases - 1.5%
Free App
Takeaway - Lines in the sand are key to measuring success
Lean Analytics Truisms● Know your funnel!● Know where you're at in the lifecycle● Establish data focus● Set clear success metrics● Instrument and track early!● Make sure that you are allocating
resources to test a measurable hypothesis
THANK YOU