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.
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.