You can’t manage what you can’t measure

You can’t manage what you can’t measure

The expression at the title is an old management truism. It comes to point out that to really fix something, you need to measure it first.

When this advice is given, it often has a second part: a promise that whatever you’re measuring will grow. This is not true all the time, but it is surprisingly true more often than you’d think.

Just by measuring something you may start to see it grow

Even if the growth doesn’t magically happen, measuring ensures that you are focused on that part of your business. Pointing a flashlight at a dark corner helps you see things more clearly.

A Korean startup I recently met asked for my advice on how to market their app. They were not getting any downloads and were worried that their market is too small. We set up a meeting to discuss, and in preparation for the meeting they calculated and prepared their statistics. To my amazement, they haven’t really checked their download statistics that often. And to their amazement, they actually did have paying users and a beginning of a growth curve. Our meeting changed from how to get users to how to increase the growth. What a different conversation! This startup was about to pull their app from the app store just when it was gaining traction. They could have killed their own app’s success without even knowing it.

Another Korean startup I was talking with has meticulously documented their funnel. A funnel is a simple concept: your goal may be to have users purchase your product, or it could be that they sign up (and login), or perhaps you are just seeking the download. Whatever your target may be, there are a few steps a potential user must do to become an actual user (or customer). These steps can be measured separately, and presented as a funnel. A common example: The prospect arrives to your site (funnel step 1), goes to the sign up page (step 2), goes through the sign up process (step 3, 4 and 5), confirms their email address (step 6) and finally, logs in (step 7 and final). Although your goal is to get as many users to complete the entire funnel (convert arriving users to active ones), your funnel “leaks” and only a certain percentage goes from step to step.

A very good funnel will have as many as 30%-50% continuing from step to step, and a reasonable funnel will have anywhere between 0.1% to 5% conversion rate from start to finish. Measuring each step of the funnel allows you to find and plug the leaks and increase overall conversion rate. Watching the funnel may also help eliminate unnecessary steps which will again increase overall conversion. In my example above I have 7 steps, and it’s almost guaranteed that just by eliminating one of the steps (merge steps 4 and 5, for example) the number of sign ups will increase.

Back to the funnel measuring startup: this startup CEO was measuring everything, and growing about 10% a week in all parameters (a phenomenal growth rate). One day, while drilling down into the statistics, they suddenly saw that Indonesia and Malaysia were responsible for much of that growth. For reasons unknown, those markets were especially receptive for this type of app, and word about the app spread around the Southeast Asia region.

This startup started focusing more and more on that region, and even physically moved for a few months to the area. This had an immediate effect of accelerating growth and bringing on board more and more excited users – which would not have been possible without the proper measurements. Who would have guessed these two countries would be the most interested for this app?

The key is not to guess. Why guess when you can simply measure?

Measuring right is hard to do – you’ll find that out as soon as you start measuring. Even though it’s hard, and at times imprecise, you must measure anything that is an important metric in your business and every metric that needs to grow. Then, watch it grow!

If you are a Korean startup that needs help going global, I want to hear from you! Consider this a personal invitation to contact me for help. I’m on Facebook, Twitter (@aviramj) and you can email me at: aviram@jenik.com to tell me how I can help you.