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[CDPS] G2 - (PR) Chapter9 - Metrics Member: Sunny / Cindy / M.J / Phoebe…
[CDPS] G2 - (PR) Chapter9 - Metrics
Member: Sunny / Cindy / M.J / Phoebe / Ian
New Measurement Challenge
2011
2012 Summer
2012 Autumn
2013 Summer
New business strategy
Workplace chat :speaking_head_in_silhouette:
2013 Autumn
Not a failure ,
it's still alive
Users plummeted to fewer than two millions
Users rapidly increase :explode:
Founded
Enabled users to make job-hunting connections via Facebook
Factors of Branchout's failure
Changing form Facebook
The concept was questionable
Focusing and measuring on the wrong things
Conclusion
Platform transform every traditional things
Demand new forms of internal measurement
Pipeline v.s. Platform
Pipeline
Key numbers of metrics
Cash flow
Inventory turns
Operating income
Gross margin
Overhead
Return on investment
Gauge the efficiency of this value flow from one end of pipeline to other
Platform
Create value primarily through the impact of network effects
Metrics
The factors that contribute to it
The success of the platform in foresting sustainable repetition of desirable interactions
The rate of interaction success
Metrics Design
Startup phase
Focus on core interaction and benefits for users on platform
Crucial metrics
Liquidity
Interaction failure will be minimize when achieved
The first and most important milestone
A minimum number of producers and consumers for mass successful interaction
Reasonable way
Tracking the percentage of listings that lead to interaction within a given time period
Active usage of platform are more important than total users
Ratio
&
Rates
are more useful:
They present the differences and changes
Tracking occurrence of illiquid situations
Matching quality
Accurate matching reduce searching cost of users
Need to convert the concept into a numerical index or meaningful metric
Intuitiveness of navigation tools offered to users
Reasonable way
Tracking
sales conversion rate
:
Percentage of searches that lead to interaction
Compare
interaction percentage
of particular users with their
long-term rate of activity
Accuracy of search algorithm
Trust
Especially important for the markets that risk accompanied by interactions
e.g. Platforms
A well-run platform usually curate both side of users successfully to reduce the risk involved in interaction
Can be achieved through excellent
curation of participants
on the platform
Tracking successful interaction of active users:
Source of positive network effects - Critical to success
Formula design for metrics
considering
Type of users
Type of interactions
Nature of platform
Type of platform business
Forms of value creation and exchange
Variety of interaction performance
Growth phase
Use the proper metrics at different stages
Ensure the core interaction can keep creating the value
platform managers must ensure the balance of two side
➡️producer-to-consumer ratio
OKCupid
customer : male
producer : female
Users rate the male
Filter the information that male can see
Maintain positive network effect
Fostering market liquidity
avoid the imbalance
Calculate the value
of each user type
Frequency of producer participation
Listings created
Outcomes achieved
Monitor instances of producer fraud
Lifetime value
Repeat producers
Help platform earn value , less cost
customer
The frequency of consumption
Monitor
Rate of conversion to sale
Help platform manager create strategy
Searches
critical metrics
The side switching rate
Unique metrics depend on different motivation
Maturity phase
Requirements :check:
Drive Innovation
i. necessary adaptations
Microsoft Windows, Cisco
ii. competitive & regulatory environment changes
a high signal-to-noise-ratio
facilitate resource allocation
Smart Metrics Elements
Simplicity :check: (
ODesk
)
Eric
3As' Test: Actionable, Accessible & Auditable
Most important metric
number of happy customers on every side of the network
repeatedly engaged in positive, value-creating interactions
Eric Ries (Writer & Entrepreneur of" lean startup" movement)
Smart metrics design
Simplicity is a virtue
Be aware of vanity metrics
Ex: The number of set-up members
3 A's test
Accessible
Audiable
Actionable
keep caring about users participation and satisfaction
Effort to boosting membership numbers
But
It doesn't mean anything
The important factors
Activity
The number of satisfying interactions
