Data analysis – basing decisions on facts

The three main reasons why you need to care about data analysis can be summarized as

  • data analysis helps you make decisions based on facts 
  • basing decisions on facts supports learning by doing
  • data helps us create plans to be used as a framework

Have you ever heard of a man named John Wannamaker

John Wanamaker (1838-1922) was a US merchant and is seen by many as the pioneer in marketing and advertising. He is known for many quotes but my favorite has to be:

Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.

John Wanamaker (1838-1922)

Now as a solopreneur starting out all you need to do is to replace the word “money” with “time”. 

And there you have it. 

You need to care about data analysis as it helps you allocate your time where it will make a difference. 

If you have read my guide on how to build a website using WordPress the right way you know that I stress the importance of

  1. getting started
  2. understanding how small changes make a big difference over time

And this is equally true about data analysis.

Data analysis may sound vague, complicated and difficult. 

And it can definitely get complicated. But there is no reason to start with complicated tasks.

There is plenty to do that is easy and that makes sense. 

You can always move on to the complicated stuff later as needed.

But first, let’s look at the three reasons why data analysis is important as a solopreneur.

Data analysis helps you make decisions based on facts

The saying “common sense is not a common thing” summarizes this point nicely.

We often know things. And we are sure about them. But often they do not stand the test of data analysis.

Do you want examples?

– Most solopreneurs will redesign their logo at least 3-5 times in the first year of operations. This is usually before we have visitors.

Why is this important?

Solopreneurs will spend time choosing and later on questioning their domain name. Is this time well spent?

After all, what was “a Google” or “a Twitter” before the services defined the brand?

Now, it could be that you should redesign your logo and maybe your domain name is too long. But those decisions should be based on data from your visitors.

It is not uncommon for solopreneurs to redesign their home page several times during the first year of operations. 

Why is this important when each individual article or post is the most likely first page for any visitor from Google or Pinterest?

Most visitors will never see your homepage. They will land on your article page and maybe read a related article or click through to one of your partners.

When we use data analysis tools like Google Analytics and Google Data Studio we learn to base decisions on facts.

So when should you consider re-designing your home page? For me I would consider re-designing my home page if Google Analytics shows that my homepage has 

  1. Visitors
    Why focus our time on a page that receives no visitors?
  2. High bounce rate and/or
    Do visitors leave the page immediately after they arrive?
  3. Low engagement
    Why are visitors not interested in reading more or requesting my free guide?

I explain these concepts more thoroughly in other articles but generally speaking data analysis will help you to spend your time on actions that will make a difference.

Remember, you only have so many hours every day.

Spend them wisely on things that will make a difference over time.

Basing decisions on facts supports learning by doing

To make money from a website is part science but also an art.

The science part comes down to having a fast loading website and making sure that we choose keywords where we can compete.

The other part can be more difficult to understand. The whole concept of “art” implies that we need to “feel” or “get it”. 

And this is true unless we use data analysis to measure the impact of the time we invest.

You are already ahead of the game as you are investing your time based on data analysis. 

By using visitor data you know where there is room for improvement.

The analysis tells you where you should spend your time.

But data analysis can never tell you how you should do it. Here you need to make a decision and make it happen.

Still, data analysis will be your best friend and help you monitor the impact of your changes. 

  1. You have a high bounce rate
  2. Make changes to your website page
  3. Measure the effect of the changes
  4. Amend and adjust – rinse and repeat

You take action based on data and then use data analysis to evaluate how effective your changes were.

This process of learning by doing is extremely addictive and you will soon find yourself measuring all kinds of user behavior and calls to action like newsletter sign ups and giveaways.

Initially you are best served if you do not make too many changes at once.

Let’s say you change the layout, logo and language. Now after a while you can see that there is a small improvement. 

How do you move on from here?

If you only changed one part of the page it would be easier to know how to move on.

There is a concept called A/B testing where we create multiple versions of a page and then compare the results from the different pages. 

We will look at A/B testing later but first you need to get familiar with the concepts and the general use and value of data analysis.

Data analysis helps us create plans – a framework

When you invest your time based on data analysis you continually learn what works.

You learn where you can invest your time for a good return on investment (ROI).

As a solopreneur, time is money. You are just starting out and you do not have a marketing or advertising budget. 

You have time. And the time you have needs to be invested for the best possible ROI.

Using data analysis you will learn where your time is best invested.

And this is where you need to spend your time.

Let’s assume you have 8 hours to spend every week.

You spend 4 hours per day creating beautiful Pinterest pins but see no visitors.

At the same time you spend 3 hours per day writing search engine optimized (SEO) articles and receive 20 clicks every day.

You spend the additional hour on general administration and outreach to create partnerships.

Here it would seem that you are spending too much time on Pinterest for the result it is yielding.

Maybe you decide to only spend 1 hour on Pinterest pins, 5 hours on optimized articles and 2 hours on administration and outreach.

Is that the ideal way to allocate your time?

It is impossible to know. But given time, analyzing data will tell you if you made a correct decision to re-allocate your time.

And making these small changes based on data will over time help you to build a framework or plan of how you should spend your time.

Allocating your time where it yields the highest ROI will help you see results faster.

How to start with no visitors or data to analyze

When you first start out you have a website and no visitors.

And no visitors means no data to record and analyze.

This is not unique. Everyone starting a website goes through this stage.

When your website is up and running you have 3 main areas to focus on.

  1. Write and publish search engine optimized articles  
  2. Track, tweak and promote your articles
  3. Outreach activities to create partnerships with related websites

These 3 activities are all important for your success but you need content for anything else to come into play.

How you allocate your time is of course up to you but I recommend the following two step approach:

The start-up phase: Less than 50 published articles

In the beginning you focus on writing and publishing search engine optimized articles.

Your goal is to create a valuable resource for your visitors.

A valuable resource needs content. This means detail and depth.

Here at this stage you focus on writing and setting up Data Analysis Tools to track visitors and user behaviour.

You spend 7 hours on writing and publishing content and 1 hour on administration like replying to email and checking that data is tracked.

The Hello World Phase: More than 50 published articles

When you have around 50 or so articles you are ready to meet your audience.

This is when you need to start promoting your content and reaching out to potential partners.

Here at this stage you need to start allocating your time differently.

You spend 4 hours writing and publishing content. 2 hours are spent promoting your content and the remaining 2 hours are used for administration, data analysis and outreach.

The numbers 4/2/2 are not written in stone. You need to find your balance.

But you must always remember that your main focus is to solve problems for your users. This will result in visitors to your website. 

You must work to earn your share of the traffic that is available via search engines and social media networks.

When you are first starting out you invariably spend a lot of time on activities that are meant to yield results long-term.

There is a promise of a ROI. But there is no guarantee.

But when we start to see visitors data analysis will help us to allocate our time where it makes sense.

And this is why it is important to care about data analysis from day 1. Even when you have no visitors. Because if you build your website the right way they will come.

And that is when the fun starts.

Meet the author: Mattias (Matt) is a serial entrepreneur and travel industry expert with more than 20 years of experience in business and web development. Mattias identifies with self-starters and entrepreneurs, loves to garden, and believes everyone needs a game plan for financial independence.