The SaaS analytics lifecycle


Whether you’re starting or growing a SaaS business there’s a natural progression of analytics tools you will go through. One of the biggest mistakes I see people make is trying to use a tool that their business isn’t ready for.

Using tools beyond your current scope will lead to wasted setup time, analysis paralysis and disappointment when that exciting new tool falls short of expectations.

What you really want is well spent setup time that leads to interesting and actionable results. Here’s my 3 stages of SaaS analytics and the analytics tools that are helpful at each stage.

Read On…

Social Media Vanity Metrics

social media vanity metrics banner

We’ve all heard about vanity metrics. Metrics that make us feel good, but don’t actually lead to sales or action.

There are standard vanity metrics like visits, pageviews and time on site. I would also include geographic location, real-time analytics and total registered users as vain in most cases.

It’s time to recognize social media metrics as vain.

Read On…

5 Key Membership Site Metrics

membership site metrics

Membership Site Metrics that Matter

Where do you start when analyzing your membership site metrics?

There are 5 membership site metrics you must track and understand:

  1. Acquisition
  2. Retention
  3. Value
  4. Engagement
  5. Amplification

There are 2 types of Membership Site Metrics: Aggregate Metrics and Member Level Metrics. The first three are Aggregate Metrics because they are most actionable as sums or averages. The last three are Member Level Metrics because easily attached to a single member. Member Level Metrics can vary greatly from member to member. Segmentation of members uses member level attributes. (I put Value in both categories on purpose.)

Below I have defined each of these 5 metrics and describe how to use each one.


Member acquisition is king for new sites. After all what is a membership site without members?

Even for well established sites acquisition is priority. If the conversion funnel is working the only thing left to do is pump in more and more qualified leads. Only take your focus off acquisition when another metric’s performance is hurting your site and thus demands attention. If you see a dip in retention or engagement you must fix those problems before attracting more new members.

How to Use Acquisition

Always track acquisition as a percentage of your total member base over a certain time period. I like weekly for high growth sites. If your growth percentage seems too low use monthly.

After a good week exclaim “4% growth this week!” not “30 new members this week!”

Theoretically this percentage is constant unless you intervene with an acquisition promotion. A successful push for acquisition will cause a spike in your growth percentage.

Growth percentage allows for direct comparison between past and present acquisition strategies. As member base grows, so does your definition of a successful acquisition campaign. The reason for this is that 50 new members a month may sound great when you are starting, but once you have 5,000 members it is not so impressive.

An important thing to remember here is to keep a clean member list. If half of your members haven’t visited in a year, they should be excluded from the growth percentage calculation. I recommend defining a dormant state after a certain period of inactivity and moving those dormant users off your list of real members. For paid sites this usually isn’t an issue, even if a member is dormant they are still paying and technically part of membership base. Paid sites will also clean themselves up a lot better.

Knowing your growth rate is also important when planning for the future. If your growth rate is 50%, you better have a good expansion plan.


Retention is a close second to acquisition. Low retention rates don’t always mean your site has issues. Sometimes it means you are acquiring people outside your target market. Check your landing page and marketing efforts to make sure the purpose of your site is being clearly defined to potential members.

How to Analyze Retention

Use cohorts to do retention analysis. This is one of my favorite things to do so feel free to contact me for more information.

If you want a walk through of how to run a retention analysis using cohorts, check out How to Do a Retention Analysis, a great blog post from Michelle Wetzler over at Keen IO.


Put a number on your members, visitors, enhancements and promotions.

Value of Members and Visitors

There are a few important values to know about any particular person on your site.

For members lifetime value is very important. This metric will usually be segmented for better insight. 

Member lifetime value segmentation examples:

  • New members referred by existing members have a lifetime value of $400
  • Members acquired through the Facebook promotion have a lifetime value of $200
  • Members from the US have a lifetime value of $300, non-US members have a lifetime value of $400
  • Members acquired in Q2 have 25% higher lifetime value than members acquired during other quarters

Don’t forget to consider all possible engagements AND amplification when calculating lifetime value of a member.

Use conversion rate and lifetime value of a member to determine the value of new visitors. If a converted visitor (new member) is worth $100 and you convert 10% of visitors, a visitor is only worth $10. (new member value X visitor to member conversion rate = visitor value)

Value of Enhancements

Enhancements made to your site will cost you time or money. Since they have a cost they should have a reward. How much is that new referral tool worth?

Estimate the value enhancements before making them. Once the enhancement launches calculate the value of engagement, new members or other value gained from the enhancement. Always compare that to your estimated value. You will start to get a feel for what type of enhancements actually make you money.

Promotion Value

Promotions cost you more than you usually pay for members or engagement in the hopes of continued member engagement.

The value of acquiring new members through promotions is easy to figure out by looking at lifetime value of a customer.

The value of a promotion to engage existing members must also be calculated. This type of promotion should drive incremental engagement. Incremental means above average for that member or segment of members you offered the promotion. A promotion isn’t very valuable if it doesn’t drive incremental engagement.


Define and quantify member interactions.

Definitions are very important when measuring engagement. Clearly define all member interactions that qualify as engagement.

Member interactions that may qualify as engagement: Log in [at a specific time], social share, watch video, listen to audio, comment, ask questions, refer new members, buy a product, file upload/download, email open/click, voting, report a sale/purchase (used for incentive and rewards programs)

Frequency and Value are two ways to quantify engagement.

Engagement Frequency

Engagement Frequency tells you how often a member engages.

Engagement Frequency should always include a time period to frame the engagement activity.

Examples of Engagement Frequency metrics using Time Periods:

  • 60 % of members visit the site at least once a week
  • 40% of members ask at least one question a month
  • Each year members who receive a bonus for referring new members bring in 5 members, those who did not receive offers refer an average of 2 members a year

The time period can also be varied, the most common example of a varied time period is member Life Time. The life time of a member is how long they will be an engaged or paying member of your site.

Examples of Engagement Frequency using member Life Time as the Time Period:

  • An average member visits the site 300 times during the lifetime of their membership
  • An average member asks 7 questions during the lifetime of their membership
  • An average member refers 4 new members during the lifetime of their membership
Engagement Value

Engagement value assigns a value to each engagement activity. All engagement activities have a value. The value is sometimes difficult to calculate, but if you have decided an interaction counts as engagement it should have value.

Engagement Value of the Engagement Frequency examples from the section above:

  • Site visits are worth $2
  • Each question asked by a member is worth $5
  • Referred members are worth $30

This membership site metric falls into Projection Analytics–from my 3 Types of Actionable Analytics post. Knowing these numbers is very helpful in deciding how much money to spend on promoting each engagement activity.

Never spend more money convincing members to engage than the engagement is worth.

There are some exceptions to consider. For example, if I spend $7 to get a member to ask a question it seems like I lost $2 if each question is worth $5. However, I also know that the average member asks 7 questions during the lifetime of their membership. That means spending $7 to get that member engaged should results in $35 worth of asked questions.


This metric is often forgotten or grouped in with acquisition. I have separated it due to one glaring reason. As opposed to acquisition, which you pay for, amplification is done by your members.

My favorite form of amplification is referrals, especially when done through a tool on your site.

How to Use Amplification

Amplification should be factored in to acquisition strategy calculations.

For example, if visitors referred through your YouTube channel are converting 20% of the time to members and visitors from Twitter are converting 10% of the time, most people would put more value on YouTube as a source for members.

But consider this: What if new members who came from Twitter refer 3 new members each.

This means that every conversion from the base of Twitter is worth up to 3 times what we originally thought. Other adjustments are needed to cover all bases, but the point is that amplification cannot be ignored.

Bonus Metric: Industry Specific Attributes

Although I think these 5 membership site metrics offer great insight, there is one game changer metric: Industry specific attributes. I didn’t include this in my top 5 since it’s not specific or actionable, but for many membership sites this can drive success for the other 5 metrics. Some examples of industry specific attributes are location and company. Location is very important for sites that sell tickets to local events or have a niche whose popularity depends on a specific place.

Thanks for making it to the bottom!

Did I miss a key metric you have seen play an important role in Membership Site Analytics? Leave a comment and let me know.

I would also love to hear how folks collect and analyze all of this data. Google Analytics, database queries, etc.