DASHBOARDS - TOOLS, TIPS, TRICKS, AND WHY YOUR STARTUP CAN'T SURVIVE WITHOUT THEM
During the last couple of years, real-time dashboards have become accessible for any company, both free and paid versions. But still, it is rarely used among startups. For many, it seems to be considered a nice to have rather than a need to have. The experts don’t agree, dashboards are absolutely vital for you to drive your business in the right direction. For example, the growth hacker experts Sean Ellis (Dropbox) and Morgan Brown (Facebook) write in their book Hacking Growth that “We are great fans of dashboards” since they help to vividly illustrate the startup’s progress to the entire team.
Indeed, dashboards are awesome for multiple reasons. To begin with, it gives you easy access to data for you and your entire team, so you will always feel like you’re in control and you will always know where you stand. Moreover, it’s a real time saver since you don’t need to manually search for numbers and update sheets to get your reporting updated every month. When your most important KPIs and metrics are automatically calculated, you can spend your time digging deeper into your data to better understand your users.
Lastly, the most important argument, dashboards have a psychological effect that unconsciously affects your decision making. The numbers you see in your charts will influence the behavior of you and your team, adapting your mindset to the performance you see in your numbers. A very interesting example of this happened at Medoucine, a startup that I helped set up dashboards earlier this year. As part of their customer success dashboard, we created a scoring of each client, where 0 was an inactive client with a high risk of churn. While the CEO was off on vacation, the customer success intern discovered that by calling a client, the score increased by 1 point. She called every one of the clients with a score of 0, ultimately reducing the risk of churn among these clients, all thanks to the dashboard and without the intervention of the CEO.
Dashboard tools are cleverly set up to help you in your everyday job. At the moment, you are probably generating your data in multiple separate tools - such as Google Adwords, Facebook Ads, a CRM, Intercom, Stripe and your own database where you store data from your site or app. With APIs and built-in integrations, you can connect these different sources to your dashboard tool, and thereby create a data center for your startup. In this way, you get real-time data fed directly from the source, which makes it possible to combine data from different sources to create a well-defined picture of how you’re doing.
So what tools are there to choose from to create my own data center? There are an insane amount of tools to choose from that all have advantages and disadvantages, I have picked three that I think are the best adapted for startups in terms of pricing and product.
- Databox is a user-friendly tool where you can use drag and drop functions to create your charts. It requires less technical skills than some other tools but you still have enough flexibility to build something that is meaningful for your company. They offer a free version but which is limited to their ready-built integrations. If you want the complete version, where you can connect APIs and your own database, it costs 99$ per month.
- Klipfolio is extremely flexible but requires some technical skills to build the charts. Unless you’re a developer, you will have a learning curve on this tool - as you probably had when you first started using Excel. The pricing starts at only 29$ per month for small teams.
- Chartio is a very powerful tool but only for data from your database and Google Analytics. You need some technical skills to set it up but afterward, it is easy to use with drag and drop functions. It is a tool that can scale with your company since it is less limited than cheaper dashboard tools. At the moment, they are working on an offer for startups which will be ready during 2019. In the meanwhile, I’m collaborating with them, so reach out to me to find out what they can offer.
When you start building your charts - there will be a couple of things that you need to keep in mind to have them generate all the positive effects that I previously mentioned. The first thing that we need to talk about are vanity metrics - those are the metrics that make you feel great, such as the number of downloads, or the number of leads, but they don’t tell you what to do. They don’t necessarily correlate with success, such as revenue and profit. You recognize them as they are usually stand-alone absolute numbers or totals. Let me instead present actionable metrics: they help you to connect your results to specific actions and they give you insight that you can act on. As an example, I could tell you that the app had 20 000 downloads, or I could tell you that the app had 20 % more downloads compared to the previous month. Which of these two metrics would you rather like to know when you work every day on increasing the number of downloads?
Watch out for dashboard templates, they are usually riddled with vanity metrics that won’t help you. Think about what is important for your team to know and create your charts based on that. The trick is to create ratios and percentages that help you connect results to actions you’ve taken. An example of a great ratio is Customer Acquisition Cost, telling you how much you’ve spent on each new customer. To learn what metrics that matter for your business - check out the article “How to get Started with Metrics in 5 Steps” .
A second thing to keep in mind while you’re building out your charts is data puking, an expression coined by the analytics expert Avinash Kaushik. This is especially relevant if you are very comfortable with numbers and are used to diving in the sea of data, but not everyone in your team might be. Data puking means that you show too many numbers without much clarity. To get away from this issue, focus on your most important numbers and strip off the rest, visualize the data to make it easier to understand and work with indicators. Indicators are arrows or colors that show however you are improving or getting closer to your goal, use them wisely to make your dashboards more digestible.
You will need to have multiple dashboards for different purposes. Start by creating operational dashboards that are relevant to your everyday operations and decisions. You will have different themes to cover all areas of your business, which means that the number of dashboards and what they contain depends on your business model. For example, if you have a SaaS solution, I would typically do Traffic, Sales, and In-Platform Activity on three different dashboards. For a marketplace, I would instead do Traffic, Buyer Conversion, and Supplier Conversion. Another idea is to have one dashboard for each team or team member, which they own and are responsible for.
On these operational dashboards, a majority of the charts will show rolling time slots, for example, last 7 days compared to the previous 7 days, or last 30 days compared to the previous 30 days. If you don’t do rolling averages, it means that your metrics won’t be updated more than once a week or once a month and you will ultimately look at them less often. It should be possible to try out something on a Tuesday and see the change in the data on Wednesday.
Lastly, you should have an overview dashboard that gives you the historical perspective, looking at your development and the trend of the company over the last months or year. This data will be displayed per month or per week. It will not be relevant to look at this one every day but to conclude the past quarter or month. Here, you should probably make graphs showing your revenue, customer acquisition cost and any other key performance indicators relevant for you, such as retention or repeat. Do share this dashboard with your investors, which means that they will better know how your business is doing and probably get ideas of how to better help you.
Finally, when you have completed a couple of beautiful dashboards, you will need to integrate them into your work habits. You should do weekly meetings where you discuss your performance with your dashboards, where every team member presents their charts that are under their responsibility. Anyhow, there are good and bad ways to talk about data. In short, you should avoid info sessions and rather work towards storytelling. Let’s take the example of an info session:
“Last week the number of leads increased by 20%”
And compare this to storytelling:
“Monday last week we launched a new Ebook, and because of that we had a big increase in leads generated during the whole week”.
The keyword here is WHY. Instead of just telling everyone what they can read on the dashboard, you should tell them why this happened. If everyone explains WHY he or she sees the performance change, the whole team will learn which actions led to what kind of performance, ultimately leading you to understand your customers better. It should be natural for everyone before a team meeting, to take 30 min to research their data and try and find the reasons why they see certain numbers.
At last, it is the CEO’s or founder’s job to ask why and demand answers to the questions that appear when discussing the dashboard. It is also his or her responsibility to switch the mindset of the company from guessing and gut feeling, to a data-driven business with customer-centric learnings that will make a difference to your company’s success.
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