Measuring Your MVP Assumptions
We want to be able to track, test and measure our MVP's results. After all is said and done we'll have a final answer if our Bitcoin idea is valid and if we should continue to develop it into a complete project.
If we receive a "no-go" on our test, sadly enough we're going to go back to square one and start the whole process all over again. You'll see as time goes by that this process gets easier and easier to perform and you will be able to go through it all in days and not weeks.
How we track stuff on the Internet
Today it's pretty easy to track how people act online. Tracking is usually done by placing a cookie on the user's browser and following his actions (we talked about Cookies in Chapter 3). Software like Google Analytics or Mixpanel allow us to view that statistics of what our visitors actually do on our site.
An additional form of tracking is through a conversion pixel. This method is implemented using a code snippet. The code places an invisible lxl pixel image on your website which sends a message when someone visits or takes an action on that page.
If you promote affiliate offers you'd want the merchant you're promoting to implement a conversion pixel on his checkout thank you page, so you will be able to track if you've made a sale or not. You'll also use conversion pixels if you use ads from Facebook or Adwords to drive traffic to your site. But more on conversion pixel when we get to Part III - Marketing Your Bitcoin Business Like a Pro.
In Chapter 7 - Building you Bitcoin MVP (the next chapter) I'm going to show you how to install Google analytics, but for now I just want to give you a brief overview of what it means to track and test stuff online. If you're not planning on hosting your own website but are going to use some 3rd party software like wordpress.com for example - make sure you have the ability to get statistics about your visitors.
When you track your visitors online there are certain terms you need to be familiar with:
Uniques or unique users
This is the term used for individuals visiting your site. Each unique user equals one person that visits your site. Even if this individual visited your website three times in the same day he will still be considered as one unique user.
Page views
This is the term used for how many times your website pages were shown. So back to our previous example of a single person visiting your website three times in the same day, he will be considered as one unique users which generated three page views.
Conversion (or goals in Google Analytics)
This term is used to measure our goals. You will need to define it manually in most programs but it's one of the most important steps, since this will tell you if your test was a success or not.
Goals can be anything that's quantifiable, for example - visiting a page, staying over a certain amount on a site, filling out a form etc.
The 300 Rule: Never decide before reaching 300 test samples
So let's say we want to test if visitors who are visiting our website are buying our product and at what rate are they converting (meaning what's their conversion rate). We set up a site, install Google Analytics, define our goals and start tracking (all explained in the next chapter).
After two days we see that 80 people visited our site and one person bought are product. If you do the math it means that our conversion rate is 1/80 = %1.25. So does this mean that we didn't meet our 2% goal and should close shop?
Not entirely. You see, for a test to be statistically significant it has to collect enough samples, or visitors in our case. This means that until I measure at least 300 visitors, I won't decide if the test was a success or not.
You may see that after 200 visits you get five conversions which brings you to a total of 5/200 = 2.5% conversion rate which is good. But after a while you get no conversions and end up with five sales from 300 visits, bringing you back down to 5/300 = 1.66%.
So be patient and make sure to gather enough samples. How much is enough, well it depends, I usually use 300 as a rule of thumb, but the more samples the better. If you can get to 500 or even 1,000 that's great.
A/B testing - When you don’t know what will work better
One form of testing I want you to be familiar with although we probably won't talk about it that much is A/B testing. A/B testing (sometimes called split testing) is comparing two versions of a web page to see which one performs better. You compare two web pages by showing the two versions (let's call them A and B) to similar visitors at the same time. The one that gives a better conversion rate, wins!
There are a lot of A/B testing tools out there that help you create the different versions and measure the results. This is used when you want to test which image works better on a sales page for example or any other element of the page for that matter. We probably won't use it that much in the course of this book but I just wanted you to be familiar with the term in case you encounter it.
Tracking tools you should know about
So now that I gave you an overview of how tracking on the web looks like, here are a few tools you can use on your website to help you track better. Keep this list as a reference and decide which tools you want to implement after creating your MVP in the next chapter. If you're new to creating your own website then Google Analytics is probably the only tool you'll need to implement.
Google Analytics
A must for every website, supplies you with the basics of online tracking. Suitable for beginners and advanced users.
MixPanel
A more sophisticated platform than Google Analytics which also fits mobile apps. This is a paid platform and is more suitable for advanced users.
CrazyyEgg
Allows you to see a heat map of your site. The heat map shows you where users look at and click the most. This is a paid tool.
Visual Website Optimizer
A great A/B testing tool that offers a free trial.
Optimizly
Another great paid A/B testing tool.
