Stage: Learn About Your Users and Improve | Progress: 0%

Stage: Learn About Your Users and Improve

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In this section:

1. You will learn how to optimize the Activation (are users signing up and going through the key activity?) and Retention (do users like my product so that they keep coming back?) of your solution based on the analytics data you get from monitoring your early adopters. Data-driven optimization Rocks!

2. You will learn about awesome tools that will help you monitor your users' behavior.

Remember Dave Mcclure's AARRR? 

At this point, the most important metrics we need to optimize are Activation, Retention - and possibly Revenue (if you are charging).

Activation is the your conversion rate of you converting visitors into users and having them complete the key activities. This metrics show you whether or not you have a convincing landing page (or problem, or solution - if you did not properly complete your customer development). When potential customers arrive at your service and do not see or do not trust your offering, they will leave, leaving you with low Activation Rate. Also, if they log in and do not perform any of the key activities, it could be because:

1. Your interface is too difficult for them.

2. Your initial follow up page after signing in doesn't entice them.

3. Key activties take too long to get to, or complete.

Retention is measuring if users return to use your service again. Once users have signed up, Retention basically tells you whether or not you have delivered your promise of the UVP to them. This is the most important metrics, as this basically tells you if you have built a useful product.

Revenue is the metrics that measure the conversion of a user into a paying user. While this is not necessarily applicable for every startup during their MVP stage, some startups that have SaaS (Software as a Service) as their product might want to start charging early. This tells you whether or not your solution is good enough for someone to want to pay for it.

Finally, Acquisition and Referral are the main drivers of visitors to your site. While these 2 metrics are tremendously important, they are not necessarily important to optimize at this point of time, since what we really need to do right now is only to validate whether or not we have a right solution and product for a real problem.

Conversion Funnel 5 Minutes

Now we want to analyze our business just like the example Conversion Funnel below so that we can divide components of our website up into Acquisition, Activation, Retention, Revenue, and Referral. We can use different analytics tools to monitor your users' behavior on your website. We will introduce those tools later.

Conversion Funnel

At this current MVP stage, we want to measure and optimize the phases Sign-up to trial (Activation), Use the key features, and Active users (Retention) so that we can validate our MVP. If you are already charging, you can also start to optimize your Revenue metrics.

Sign-up to trial - The conversion rate of visitors into users tells you if you have successfully delivered your UVP message on your website or landing page to the visitors so that they realize that your solution will solve their problems. If your UVP and content on your landing page is very accurate and precise, then this conversion rate will tell you whether or not you really have a solution people need.

Use the key features - For the number of users that sign up, how many of those actually go in and start using your services, and do they use all of the key features? If you have a lot of users that just sign up, log in, and doesn't go on to use the main features, then it could be that your main features are a little bit too complicated for them. Perhaps some onboarding would help them use more of the key functions that will help him solve their problems. 

Retention - This is the number of users that come back after they've signed up. If your key activites were completed and you have consistently sent reminder or content emails to remind them to come back to complete their activities or read new stuff, then you will have a healthy user retention. Retention is the most important indicator of a successful startup. We've repeated this so many times, but we dont' think we can repeat it enough.

Revenue - This is the number of users that sign up, and then pays to use your service.

How to increase sign-ups 10 Minutes

It is important that we separate Acquisition and Activation. There is no point finding new channels and get new users if your website is not able to convert visitors into users. You'd just be depleting your visitor source.

Before we attempt to get more users to try out our service, we must make sure that our UVP, our solution, and our landing page are attractive. In the next section Growth Hacking, we will give you all the tricks you need to know to get more users, so don't worry.

Ways to increase sign-ups (a good conversion rate is 10%):

1. Optimize your landing page to include the right keywords or content to entice your users.

2. Improve the visual quality of your landing page.

3. A/B test your UVP message  to see what your customers can really connect to. Good value propositions hit the right emotional strings in a customer that triggers their buying motivation.

4. Include social proofs or testimonials before your users will even start to listen to what you are trying to say, you must make them trust you first.

5. Make the sign-up process easier - Perhaps make signup process informational, but still relatively frictionless. If you need to collect more information, you can ask them after they've already signed up and going through the onboarding process (we'll get to that in the next task).

How to increase key feature usage 7 Minutes

Ways to increase key feature usage:

Onboarding Features - this general term is the technique of making it easier for the user to receive the solution you are trying to deliver, when they log in the first time. Everything you do to familiarize them with the service so that you can successfully deliver your solution is considered onboarding. Basically, leading users to use your key features has everything to do with creating an amazing UX/UI (User Experience/User Interface). 

This is tremendously important, because no matter how convincing your landing page is, or how many users you can get, users will abandon your service if you don't lead them to complete key activities and get their pain points solved.

Observe your customers and see what you need to do to get them to use and complete your key features. Your goal should be to get at least 60%+ of the users to complete all your key activities.

Things you can do include:

1. Make a tutorial screencast about using the main key features. Videos are super captivating, and they have the highest click rate.

2. Create a live tutorial to lead them to click on the right buttons. We're talking about interactive popups that appear to instruct them to go through series of tasks or button clicks.

3. If your website is social and friends refer friends to sign up, having friends who are already users of the service greet the new user would be a good way to let them feel welcomed. When you end them the welcome email, if you could also include some of the profiles of their friends in the email, it'd also motivate them to come back. 

4. Ask the user to input more of their personal interests then show them content that fits their interest. This is different from having the user discover content themselves. For example, if you are operating a social news, it'd make sense to help the users select their interests and show them news that would interest them so that they immediately see the value (VALUE!) of your service. 

Example: If you are running a dating website, it makes sense to ask the user to input his/her dating preference upon first login (their interests, occupation, location, etc.), so that you can use their input as data to show them better matches that are more relevant to them.

The onboarding preference form and then showing matching dates help the user complete a key activity cycle, and also your delivery of the UVP - which is showing them promising and attractive dates, which will make the user want to come back to try some more.


What's your onboarding strategy? What do users see when they first log in?

How to increase active users 3 Minutes

Ways to increase active users:

1. Make sure your key features are easy to use, and actually does solve the problem. You can see where your users are dropping off in the process and you should then try to optimize the parts that are not doing so well.

2. Send event emails to ask them to come back if they have been inactive for a long time. Send emails to users who have started doing something but have not finished. Send interesting new content to users to remind them. Send emails to ask them for feedback. Update users on your new features.

3. Follow up with the interviewees or early adopters that you have interviewed during the MVP Interview in a precious chapter.

4. Onboard - Mentioned in the last section, the most important thing is to make sure that the user gets what he/she needs upon the first login. Once they see that their problem can be solved with your service, then they will definitely come back.

5. Make your platform humanly - Users feel warm inside and has a better impression of platforms that are humorous and seem more humanly. If you can get users to feel like they are interacting with a human being, then they're more likely to come back. Talk to them and make them feel at home. You wouldn't ditch a friend would you?


What is your strategy here? What is your plan to get them to keep coming back?

How to get more paying customers 8 Minutes

Ways to validate your pricing and get more people to pay for it:

1. Ask early adopters and let them tell you if they think if the pricing if it's too high, too low, or if the package you've provided has too little or too many features.

2. Study your competitors pricing strategies. Most likely they've already worked hard on their pricing plan and know what works and what doesn't.

3. A/B Test your pricings. This is not to say you price the same plan with 2 different pricings (that'll create a lot of problems). Offer different packages at different pricings to get a feeling of what the market is okay with. A good article to read is here:

4. The pricing is also a part of your product. Do not price your service too low just to get more users. If your product is a $100 product, and you are selling it at $50, people will be more cautious thinking your product is too good to be true.

See this task for the best pricing practices.

See this article for your pricing strategy


How are you getting them to open up their wallets? What's your strategy?

Ways to measure - Analytics 3 Minutes

Using analytics, we recommend Google AnalyticsMixpanel, or KISSMetrics, you can track the behavior of all of your customers. You can basically find out every information about them. You can see how many visits you had on your page on any given day. You can see where your users came from, and which channels gave you the most users. You can also see how much time your users are spending on your website. You can see which buttons on your website are pressed, and which are not. You'll also see how many users are returning users, and how many of them are new.

You can also track a users' tracks on your website to see if they are actually using the main features, what they are using and they are not, and which page are they leaving from.

Analytics tools will give us all the information we need to tweak our product into a better one.

Web/Social Customer Analytics Tools

  1. Google Analytics – web analytics and optimizer from the borg
  2. Kissmetrics– actionable analytics
  3. GetClicky – real-time web analytics
  4. Swix – analytics for social media and online
  5. Leadlander – marketing automation analytics
  6. Seomoz – SEO and social monitoring
  7. Wordtracker – find the best keywords and links
  8. Serpico – monitor your competition, backlinks & rankings
  9. - easy analytics for business data
  10. Mixpanel– real-time event tracking
    1. Mixpanel Analytics Tutorials
  11. DigMyData – analytics dashboard for sales, email, social and ad marketing
  12. Crazyegg– visualize analytics
  13. Mint – site analytics
  14. Visistat – web analytics measure marketing campaigns
  15. Webtrends – analytics and segments
  16. Chartbeat – website analytics for doers
  17. Kontagent – user analytics for the social and mobile web
  18. Forsee – web, mobile, social, contact center analytics
  19. Woopra – real time customer and visitor analytics
  20. Comscore – ad agency/enterprise analytics
  21. StatsMix – track and display internal & web metrics
  22. Keylines – amazing email visualization tool (Palantir for the rest of us)
  23. Ducksboard – very cool way to measure any online metrics
  24. Cyfe – monitor social media, analytics, marketing, sales, support
  25. Mention – media and social monitoring
  26. Geckoboard – widget-driven business dashboard
  27. Grappster – dashboard for your cloud apps
  28. Leftronic – dashboard for real-time analytics
  29. PirateMetrics – track acquisition, activation, retention, referral, and revenue
  30. – Twitter brand monitoring
  31. WhosTalkin - Social Media Search tool
  32. Diffbot – identify and extract from any web page (stealth search engine!)

Mobile App Store Customer Analytics / Ad Platform

  1. Google Analytics - for Mobile
  2. AppAnnie – Apple/Google/Amazon app store analytics
  3. Appfigures – mobile analytics and sales data
  4. Mopapp – mobile analytics, sales data, rankings
  5. Distimo - Apple/Google/Amazon app store analytics
  6. Xylogics – search engine for Apple/Google/Amazon app store
  7. Apptrace – app store intelligence
  8. AskingPoint – mobile analytics with polling
  9. Flurry - mobile app analytics and traffic acquisition
  10. TestFlight – IOS analytics in beta testing on the fly
  11. Apsalar - mobile apps analytics & ads
  12. - multiplatform mobile analytics
  13. KeenIO - analytics as an API
  14. Capptain - mobile analytics + push
  15. TapStream - Marketing analytics for apps

Video Analysis Tools

  1. Tracker – way cool video analysis tool
Google Analytics 30 Minutes

Log into Google Analytics, Create a new profile, and get the tracking code that you need to put between the <head>...</head> section on your website.


Before you use the tool, you will need to allow Google to track the visitors and data of your website. 

Google Analytics is our favorite as it gives us most of the information that we need without doing anything. It automatically gives us metrics that we care about. While it's not customizable, it can already show us a lot of the information that we need.

Google Analytics Visitors Flow

In Google Analytics, there are:

1. Real-time Visitors Data

2. Audience - From, New vs. Returning, Visit Frequency, Engagement, User's Browser

3. Traffic Sources - See where they came from (Search/Referral/Direct), what keywords did customers use to find you, Google Adwords data

4. Content - See which pages were visited, site speed, site search, A/B Testing, In-page Analytics (to see what buttons were clicked, and how many times)

5. Conversions - This is where you can track your conversions.

How to read Google Analytics:

1. Audience - Under this tab you get the profile of your users. You can find out what language they speak, where they are from, how many them are new users and how many of the existing.

You can even find out what browser and which internet service provider they are using. Other than that you can also see if your users used mobile to come to your website. And then the most powerful feature is the visitor flow. The visitor flow shows the path of your users - where they are going, and when they are leaving from.

2. Traffic Sources - The best part that I like is Sources->All traffic. This part shows me where my visitors are coming from. Why this is important is because I can then see which channels are the most useful for me, so that I can keep working at them. Under sources, you can see there are 3 types of traffic - direct, referral, and search. You should also adjust the date range to get a closer look on the changes that resulted from your latest changes or actions.

Direct: These are users that probably got the link from a friend, or somewhere, and they just typed it directly into the browser.

Referral: These are the users that came from another website that has your link. This is the result of good linking or spreading links onto other websites.

Search: These are the users that searched for keywords that you target, and have come here directly from one of the search engines. This is the healthiest kind of traffic because search traffic is usually very long-lasting, and this kind of traffic is based on doing a good job in SEO. When Google ranks your website for certain keywords, usually the effect will last for months, and will last longer if you keep it up. It will drop if you just stop to maintain it.

Under search, there is also a paid tab, which tells you how many of those came from Google Adwords. This has nothing to do with SEO, and are traffic you will only get if you pay for them.

While there is no good mix of how many percentage of direct traffic, or referral traffic, or search traffic you should get, but you should have a good mix of all 3 source of traffic. Also, different types of websites can get a different mix of traffic. For example, a social news website probably has mostly search and referral traffic while a website like Wikipedia probably gets most of their traffic from search. 

3. Search Engine Optimization (SEO) - You can discover what keywords were searched  that showed your website's result in Google (Queries), or which pages were shown in the search results (Landing Pages), and where did the search visitors come from (Geographical Summary)

4. Social - There's a lot going on here, but all of the tabs are quite self-explanatory and show you different metrics on how social websites like Facebook, Twitter, Digg, Reddit etc. have brought you visitors. The only thing that most people should have questions with is the Trackback function. The Trackback function is basically a function that tells you which post has referenced your website or article. It's usually used for bloggers to know which article mentioned their article.

5. Advertising - If you are advertising with Google, you can see your data from adwords here.

6. Content - This tab shows you traffic data on your individual pages. You can see which pages are most visited, and which pages are causing users to leave. Here you can also see your website's load speed, and events. If you are delivering Google Ads (Adsense) on your website to make money, then there is also a integrated feature here so you can see how you are doing.

Experiments - This is the A/B Testing for your website. You can set up 2 different variations of your website to see which works better. 

In-Page Analytics - This function will open up your website and show you how often each button was clicked in a visual presentation. This is very useful to see if there are some important call-to-action buttons that have not been clicked so that you can try to tweak and optimize them.

Conversions - This is where you can configure Google Analytics to help you track the conversions and purchases on your website. With this data, you can check to see how well you are converting a visitor into a user, or a user into a customer.

Under conversions, you can set up 3 kinds of funnels as below:

Goals - A way to track completed actions on your website (tracking downloads, signups, checkout completion)

Ecommerce (collect data on purchases, purchase amounts, billing locations)

Multi-Channel Funnels (This is goal + eCommerce analytics that helps you see how the goals you've set perform to help you get purchases)

Also read this: Beginner's guide to data analytics

Mixpanel and KISSMetrics 30 Minutes

Mixpanel and KISSMetrics are 2 of the most popular customizable analytics tools out there. Both tools allow you to put sniplets of codes into your pages to send events to Mixpanel or KISSMetrics to track. They're also strong tools to track how valuable your users are, how they buy, and which pages give you the most value.

For example, you can customize a funnel to view the efficiency of your conversion funnel - See how many visitors come, visit the signup page, sign up, and use your main feature.  A example of a chart from Mixpanel looks like this.

mixpanel funnel

It can show you your efficieny every step of the way for a customer's entry to the website, to signing up, to using your key features, and to paying for your service. With the data from here, you can know where you need to improve to get more users to do what you want them to do.

These tools are quite easy to use, and both providers have very awesome instructions to get you started and optimizing your website.

Get Feedback 15 Minutes

Beside getting data back from the analytics tools, the fastest way is to actually just talk to your customers directly, either through phone or email. 

If you can get personal contact information from your users, then that'd be the best scenario. If you can't, then email them (maybe select the more active users), and ask them about their experience. The point here is to ask their experience with using your service, and trying to learn as much as you can.

You can use a email marketing tool like MailChimp to send out a feedback asking everybody about questions that can help you learn more about what they think about your product.

Example of the feedback email that StartitUp sent out that got us a lot of great feedback:

We want to get your feedback on StartitUp

So that we can improve!

Hey! ,

This is Edward, and I'm the co-founder and CEO of StartitUp. I want to personally thank you for being a critical part of our startup community and for being an early adopter of StartitUp.

Our mission is to build a free startup guide with the most effective and updated action items to help startups build and grow their startups. That being said, we need your help to give us some feedback on how we can improve our platform! 

If you can just give me 1 minute today and help me answer 6 simple questions, that'd be great:

1. Are you an entrepreneur? or are you thinking of becoming one?
2. Are you already working on something? or planning on starting? 
3. Are you interested in using StartitUp's Guide to build your startup? or are you just checking it out, out of curiosity?
4. What do you think about the guide and its content, and what would you like us to improve on?
5. Are there additional features that'd you'd suggest us to build?
6. Any other thoughts?

That'd be great.
We threw in Bill Lumbergh just to spice things up a little.
Summary 10 Minutes

After this section, you would have gained the skills to validate your MVP. With the knowledge from this stage and after optimizing your product, you now know whether or not your solution or product is a product that people want.

At this point, there are 2 options you can take:

1. After optimizing the few parts of your product, you were able to increase the conversion rate, which also proves that your product is attractive enough that visitors want to become users. At this point, you have successfully validated your MVP. Congratulations! While you should never stop optimizing your Acitvation and Retention. However, now that we know that your product works, you can start growing your customers. Go on and learn some Growth Hacking!

2. You were just unable to convert the users. Your conversion rate is too low, and no matter what you do, your users just won't sign up. Even if they do sign up, they do not use any of the key activities. What's happening here is that you probably have a solution or a MVP that is not attractive enough for your target audience.

What we would suggest now is to go back to Customer Development to relearn about what your customers really want. Do not feel bad! Most companies pivot and succeed with a new tweaked solution. Or, you can email Ed so that we can bounce some ideas around.

All the different types of pivots (From Eric Ries):

  1. Zoom-in pivot. In this case, what previously was considered a single feature in a product becomes the whole product. This highlights the value of “focus” and “minimum viable product” (MVP), delivered quickly and efficiently.
  2. Zoom-out pivot. In the reverse situation, sometimes a single feature is insufficient to support a customer set. In this type of pivot, what was considered the whole product becomes a single feature of a much larger product.
  3. Customer segment pivot. Your product may attract real customers, but not the ones in the original vision. In other words, it solves a real problem, but needs to be positioned for a more appreciative segment, and optimized for that segment.
  4. Customer need pivot. Early customer feedback indicates that the problem solved is not very important, or money isn’t available to buy. This requires repositioning, or a completely new product, to find a problem worth solving.
  5. Platform pivot. This refers to a change from an application to a platform, or vice versa. Many founders envision their solution as a platform for future products, but don’t have a single killer application just yet. Most customers buy solutions, not platforms.
  6. Business architecture pivot. Geoffrey Moore, many years ago, observed that there are two major business architectures: high margin, low volume (complex systems model), or low margin, high volume (volume operations model). You can’t do both at the same time.
  7. Value capture pivot. This refers to the monetization or revenue model. Changes to the way a startup captures value can have far-reaching consequences for business, product, and marketing strategies. The “free” model doesn’t capture much value.
  8. Engine of growth pivot. Most startups these days use one of three primary growth engines: the viral, sticky, and paid growth models. Picking the right model can dramatically affect the speed and profitability of growth.
  9. Channel pivot. In sales terminology, the mechanism by which a company delivers it product to customers is called the sales channel or distribution channel. Channel pivots usually require unique pricing, feature, and competitive positioning adjustments.
  10. Technology pivot. Sometimes a startup discovers a way to achieve the same solution by using a completely different technology. This is most relevant if the new technology can provide superior price and/or performance to improve competitive posture.
Stage: Soft Launch + ... Stage: Grow to a Mill...