SaaS Analytics to Enable Product Led Growth​

Ok, here’s the deal. Tracking and analytics is a bit of a black box, so rather than trying to tell you which tools you should use, how you should define and code events, how to connect data,  and how to visualize your data, I’m going to keep this more general and focus on SaaS analytics strategy and planning.

In this article we’ll cover:​

1. Why you need to plan tracking and analytics from the beginning
2. Defining a tracking and analytics plan for your SaaS business
3. Collecting and visualizing SaaS data
4. How to keep your SaaS analytics simple
5. Using data to guide decisions​

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Why You Need SaaS Analytics

You’re building a business and you need to be able to measure it and the sooner you start, the sooner you can start improving. Your business is going to go through a number of different iterations as it grows and matures, the one thing you can count on not changing is that you’re going to rely on data to help guide you through each stage in your businesses evolution.

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My product is still in beta, do I really need to build a SaaS Analytics plan?

Yes, I recommend you spend some time instrumenting event tracking in your SaaS app prior to launching your beta, and ideally you’d have event tracking live during your alpha.

In order to successfully operate a product-led growth strategy you need to understand how your customers are interacting with your product. In some way, the data you collect in your alpha/beta is the most important data and customer interactions you will record.

These early experiences will define the product you bring to market for general availability.

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What should I be tracking during alpha and beta?

You don’t have to make this more complicated than it needs to be, in fact, the best tracking and analytics plans are minimalist, making them easy to derive insights and take action.

the best tracking and analytics plans are minimalist, making them easy to derive insights and take action.

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• You likely have some areas of concern, build tracking here to understand how your users interact with this area of your product; alternatively set up a tool that records user sessions so you can watch the interaction
  
• You’ll want to come out of beta feeling confident about the first impression your product leaves with your user, ensure you have tracking set up so you can understand activation, and any friction leading up to it
  
• Are you delivering value? Define value and set up tracking to ensure your users are able to get there
  
• Add event tracking for key features to measure usage (or lack thereof)

You’ll want to take some time to plan your SaaS analytics, don’t just ask one of you, developers, to instrument analytics in your app. The tracking you put in place now is going to be the foundation for all future tracking and analytics to come. Spend the time to properly define a tracking plan, naming convention, and overall strategy for leveraging the data.

Defining a SaaS Analytics Plan for Your B2B Business

Spending the time to think through and properly define a tracking plan will save you the frustration of trying to decipher your event tracking down the road when you’re trying to make use of the data you’ve been collecting. Trust me, if not properly defined it will take on a life of its own, and before you know it you’ll have duplicate events and dozens of naming structures making the data difficult to consume and trust.

Define business objectives

What are your business goals for the current year? You could be focused on customer acquisition, brand awareness, product engagement, revenue growth, key account expansion, referrals, and reviews, or some combination of these things.​

Defining a business objective is the first step to outlining the events that will be needed to understand and optimize the business for the desired outcome.

For Examaple:

Business Objective: Product Engagement

What are the steps or actions your customers complete that define this objective?

• Customers log into your app on a regular basis (daily, weekly, monthly)
  • Trigger event each time a user completes the login
    
• Customers have completed all of the steps needed to be fully activated
  • Trigger an event when the user has completed all activities associated with activation
    
• Customers have achieved value and continue to engage with the product
  • Trigger an event when the user has achieved your definition of value
    
• Customers engage with product features on a regular basis (daily, weekly, monthly)
  • This one’s a bit more complicated, you’re basically measuring that your customer is regularly engaging with your product, indicating that they have fully adopted it, and are relying on it to do their job. You want to be sure you’re not simply counting customers that log in, rather customers that log in AND complete some number of other meaningful events that indicate they are using your product. Tools like MixPanel make it easy to define this type of filter once the events are instrumented.
    
• Customers level of usage is low, medium, high compared to ALL customers
  • Trigger events for feature usage and other engagement points within your app, from there a simple way you bucket your customers (high, medium, low) is to count the total number of events and group accordingly.

This is the basic idea.

Identify a business objective and then break it down into measurable components that can be instrumented via event tracking within your app or website. My advice is to take a minimalist approach and build events you know will be meaningful, rather than adding an event for every possible item. This approach will reduce noise and make it easier to analyze and take action on your data.​

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Defining a naming convention

This one is pretty straightforward and there are a number of existing resources out there to help guide you through this process. Segment has defined a nice list of things to keep in mind when defining a naming convention for your SaaS Analytics.

Here it is directly from Segment

Collecting and visualizing data

Here is where things get tricky, and/or expensive. In order to visualize data across the full funnel, you’re going to need to invest significant capital into tools/services, expertise, and people. The challenges are not in the collections of the data, but in connecting the data and making it usable. There are a number of business intelligence solutions out there if you have the appetite and expertise to leverage them, if not here is an outline to collect and visualize your data taking a minimalist approach, with a  focus on actioning your data.

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Select a service to build your event tracking

This is a business decision. Will you use Segment, Google Tag Manager, MixPanel, or some other service to instrument your event tracking. Pick one, and use it for all event tracking.

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Clearly define the events to be instrumented in your SaaS Analytics plan

One of the main reasons we go through the planning exercise outlined above is to ensure we are collecting data that is meaningful to the business. It’s like adding salt to a recipe when cooking … you add it a little at a time because you can always add more, but once it’s in there it’s difficult to get out.

Limit your tracking plan to only the most critical set of metrics that you know for sure are meaningful to the business.

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It goes something like this:

1. Define the action to be tracked
2. Describe why the action is meaningful to the business
3. Define what the desired outcome looks like
4. Name the Event following the pre-defined naming convention
5. Identify all data to be collected at the time of the event
6. Instrument the Event
7. Test that the Event is firing properly
8. Ship it

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Track only the most important events

My suggestion when you first get started with instrumenting event tracking in your app and website is … if you’re not sure if the data will be useful, don’t track it. You can always add it in if questions arise.

You really want to focus on defining a core set of metrics that are critical to the business. Trim the fat and get clear on the most critical data that you will use to inform decisions and take action.​

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I have all this data, how do I visualize it?

A solid foundation here is Google Analytics and MixPanel. Google Analytics will get you very comprehensive anonymous data across all of your web properties, and MixPanel is the leader in product analytics.

Default to MixPanel for product led growth data where you’re trying to understand how users are engaging with your product if they are achieving key milestones like activation and value.

Where you’re trying to understand channels, campaign performance, awareness, reach, etc. default to Google Analytics.

These two services are powerful and will take you pretty far. You’ll inevitably find limitations, and at that point can reassess your needs and stack. The foundation you build should transfer to any new solution you decide to adopt.

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Using SaaS Analytics data to guide decisions

If there is an overarching theme to this chapter it’s, keep it simple. I can’t emphasize this enough. You don’t need 1,000 data point to inform a decision, what you’re looking for is feedback from your customers in the form of product engagement:

• Are customers having success with your product?
• Is there friction that can be eliminated?
• Are there features that are not being used?
• What are the most used features?
• Are we attracting the right customers?
• Are we delivering value efficiently?
• Are our customers fully adopting our product into their daily routine?
• Do we have enough top of funnel interest to achieve our business goals?

You get the point.

Before you even begin instrumenting your event tracking and SaaS analytics you should have a list of questions similar to the list above that you expect the data to provide answers to.

Start with why, and your tracking plan is much more likely to deliver the results you’re looking for.