UK startups struggling to make data-driven decisions to power innovation due to the expensive analytics software could soon breathe some relief. The current analytics pricing model has been identified as a key challenge as it often proves unaffordable for these young companies. Their attempts to opt for 'freemium' models, which are usually perceived as temporary fixes, often lead to costly investment.
This prevailing issue has prompted Amplitude to introduce its new Plus Plan, an affordable, self-serve analytics platform for startups costing just $49 per month. The platform encompasses functionalities such as Analytics, Customer Data Platform (CDP), Experimentation, and soon will incorporate Session Replay. With the Plus Plan, startups will have the required tools to improve their products and fuel innovation.
The problem with the availability and affordability of analytics software is presently hampering the momentum of startups that significantly contribute to the UK's economy. this has been compounded by the economic backdrop, with technological enterprises facing a 57% funding drop in H1 2023. Consequently, fewer resources are available to support their growth and drive innovation.
The availability of freemium models offers some succour but proves costly in the long run. Startups heavily reliant on these tools for key data-driven decisions often grapple with escalating prices, resulting in tough decisions between costs and innovation.
The cost escalation from freemium to paid models often hikes up to five-figure sums annually, making it unrealistic for many startups. Moreover, the event-based payment model, where startups pay for every individual action taken within a product, is not particularly helpful for startups that are new to analytics and unable to estimate the actual costs. Spencer Skates, CEO of Amplitude, acknowledges, "The event model is broken. It's extremely difficult to know how many events you'll send, which makes understanding how much you'll pay impossible."
Skates further explains how the existing model can inadvertently lead to a vicious cycle. The lack of proper event tracking limits the value received from analytics, reducing the desire to track even further and leading to less value.
The solution lies in revamping the analytics pricing model. Limitations on event tracking should be abolished since it affects the overall culture of analytics. The idea is to balance between fast shipping and quantifying impact rather than selecting either.
Further, while freemium tools like Google Analytics offer certain value, they don’t delve deep enough to allow startups to comprehend what drives active user growth and improves conversion, monetisation or retention. If startups can't trust the data, they won't use it, thereby hindering change. Startups need affordable access to trustworthy data, clear insights and the capacity to act swiftly to enhance customer experience.
In response to the concerns raised over pricing, Amplitude conceded to previously being a part of the problem. Subsequently, the company launched its unique full data analytics platform, the Plus Plan, at a monthly fee of $49. The Plus Plan bundling Analytics, CDP, and Experimentation purposes to equip startups with essential tools.
Nick Newell, VP of Engineering at MySwimPro, praised the Plus Plan for its speed and quality, claiming it helped the company reduce its change failure rate from 30% to 6% and slash mean time to restore from 30 days to just two. Amplitude's Plus Plan is set to make data cheaper and more scalable for startups in the long run.