When establishing a startup, it’s fair to say that business owners can easily lose track of the bigger picture. With so much precarious decisions to make, and such little margin for error, it’s imperative that you listen to the wants and needs of your targeted customers and optimise your processes accordingly. The vast majority of startups fail – over 90% of them in fact. While this is a figure that can’t be ignored, it’s one that your startup doesn’t have to contribute to – just so long as you keep track of all the other vital metrics such as traffic analysis that can help you to better understand what’s going right, and wrong, for your fledgling endeavour.
It’s commonly accepted that the majority of new businesses fail because of a lack of funds, or failing to find a market willing to make the purchases needed to stay afloat. But with the right set of data analysis tools, a business can not only identify the right audiences and adapt its acquisition strategy accordingly, but it can also allocate funds more intelligently as a means of optimising its budgets.
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Fundamentally, when a startup fails, you can be sure that some invaluable figures have been ignored somewhere down the line. Let’s take a deeper look at some of the most significant drawbacks in the analysis of data for startups, and explore how these shortcomings can be effectively mitigated:
Driving conversions with traffic analysis
(Google Analytics visualisations pave the way for improved conversion funnels. Image: Megalytic)
If you’re running an eCommerce store, it’s vital that you forge some form of understanding of how your conversion funnel works. If you don’t understand why customers are navigating on to your site, or why they’re abandoning the act of making a purchase, then your startup could be in big trouble. You’ll essentially be blindly running your operations.
The most important thing here is to ensure that you have a measurement set up for conversions and looking out for when users navigate away from the purchasing process. Google Analytics is an excellent free tool that helps to stave off the dangers of missed purchases for startup owners and established business owners alike.
Notably, Google Tag Manager makes for another welcome addition when it comes to managing the events and metrics that are being beamed to Google Analytics. Tag Manager can be more effective than simply triggering events from a front-end codebase because you won’t tie your event tracking to your codebase and because you won’t always need a developer to track events.
(Conversion metrics can extend far beyond the confines of a funnel. Image: Finteza)
Understanding your sales funnel is one thing, but harnessing the wealth of big data available to your startup is another task entirely. Analytics platforms like Finteza boast comprehensive levels of coverage for businesses to really get to grips with the factors that make their respective websites tick.
Conversion analytics can extend to the monitoring of individual clicks on advertisements, the instances where the built-in search bar is used and countless other metrics that are, in some cases, powerful enough to monitor where your prospective customer’s mouse is hovering.
Such fine details may seem inconsequential, but they can spell out big problems when it comes to gaining conversions. If your internal links aren’t transferring enough prospects through the checkout process then this is something that the data will show. Whereas, if not enough audience eyes are being guided to your call to action, data can show this too.
At a time when each purchase can be vital to the progress of your startup, deep conversion analytics can really shine a spotlight on exactly where sales may be lost.
The cost of missed opportunities
In his article for Medium, Tom Maiaroto suggests implementing ‘opportunity cost’ into your conversion rate optimisation.
Originating as an economics term, opportunity cost points to “the loss of potential gain from other alternatives when one alternative is chosen.”
Sounds complex? It doesn’t have to. Opportunity cost simply highlights what you’re missing out on by failing to heed the advice of your analytics and optimise your conversion strategy accordingly.
It’s not uncommon to see visitors drop out of the funnels of startups. Many people won’t see the merit behind subscribing to a new mailing list or spending money on a company they’re yet to build trust in.
Opportunity cost can work as a reliable metric that helps startup owners to quickly highlight their conversion loss leader. The most costly part of your sales funnel will undoubtedly be the part of your website that’s losing the majority of potential customers. Be sure to plug this hole and any other high opportunity cost areas of your website - whether it’s a severe lack of quality internal links or a weak checkout process.
Of course, data analysis extends far beyond your funnels and how you interact with visitors to your pages. There’s a wealth of metrics available that can provide insights into how visitors navigate onto your pages and how long they choose to stay for.
Traffic analysis is the cornerstone to building customer confidence to the point where they’re ready to click ‘buy’ or ‘subscribe’.
Organic search forms a huge part of building interest in a new business, and traffic analysis makes for a perfect way of ensuring that your optimisation strategies are on point.
If your backlinks aren’t getting the hits they need, or your call to actions are falling flat, you can find all the information you need within the analysis of your website’s traffic. Which URLs are drawing in the most visitors? Which landing pages are causing them to stay for longer?
Conversion and traffic analysis tools can shine lights on the data that matters for your website. No, in the grand scheme of things, landing page bounce rates and AMP compatibility may not be the sole reason that your startup fails, but at such a fragile time in your business’ lifecycle, it certainly pays to have all bases covered.
Analysis tools may seem inconvenient in the level of data they’re capable of throwing at you, but when your startup’s survival depends on fine margins, it’s certainly worth delving into big data.