How do I build an analytics strategy for my product?
Analytics strategy: the short answer
Build it in three steps. Break the product into parts using the AAARRR funnel or by feature. For each part, pick metrics that inform a real decision and drop vanity metrics. Start broad, then go deeper where it matters, with one north star metric per stage and the L1 and L2 KPIs that feed it.
Analytics strategy, in detail
Build your analytics strategy in three core steps.
Break down your product. Don't tackle everything at once. Segment into pieces using the AAARRR funnel (Awareness, Acquisition, Activation, Retention, Revenue, Referral) or by features. A holistic approach will miss the nuances of how users behave in different parts of your product.
Design metrics that are actually actionable. For each metric, ask: What decision will this inform? Does it enhance understanding of user behavior and drive action? If not, it's a vanity metric and should be excluded. A metric like "total products viewed in a week" tells you nothing; "products viewed before adding to cart" tells you where to optimize the funnel.
Avoid going too deep. You'll be tempted to track everything, but you'll end up with nothing. Start broad to identify areas for deeper investigation, then progressively refine your insights. For each segment of the AAARRR funnel, define a north star metric-your major focus for the quarter-and the L1 and L2 KPIs that inform it.
Analytics strategy: where this answer comes from
Analytics strategy: further reading
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