Don’t Build When You Can Buy: Why DIY Mobile Analytics Platforms Are Bad Investments

October 27, 2014

Edward Tan

dont_build_when_you_can_buy_mobile_analytics

Build or buy? For many, the decision to go in-house or to an outside data analytics provider boils down to simple economics: is it cheaper to build from scratch or buy a platform? A lot of companies opt for the former. After all, any respectable mobile developer already has a team of engineers. Grabbing a few to create a data analytics solution shouldn’t be that hard, right?

Wrong. While it might not be a surprise that creating an analytics platform from the ground up is difficult, the reality is that it’s also usually more expensive. Most would say that the choice comes down to what works for your company, which is definitely true. But what’s also true is that for the majority of brands, buying is best.

Over the past decade, we’ve watched the industry evolve from monochrome phones to smartphones and tablets, and witnessed how the role of analytics has grown. In my time, one thing has become clear: when it comes to data analytics, buying is the way to go.

There are many reasons why this is fact and not opinion, but here are five of the most important.

Building is more expensive

Let’s face it, money is the reason why you’re even considering building your own mobile analytics platform. But if you go that route, chances are you’ll be spending way more than you think.

The average salary for a entry-level data engineer is over $90,000 in California. While the cost of living in the Bay Area is expensive, it’s also where most engineers and mobile developers reside, so the figure is a good rubric.

Conservatively, most data analytics startups have about six or more engineers working around the clock to build a functional analytics platform with a development time of at least a year. Even by these estimates, you’re looking at almost half a million dollars in development cost. And that’s on the low-end.

The reality is that without a bigger team and an experienced (and costly) engineer with knowledge in the field, your DIY analytics project won’t deliver the results you need. And even with them, the process is likely to take more than a year. Wouldn’t that money be better spent elsewhere?

Building ties up resources and degrades your core product

Speaking of more effective uses for your money, have you considered what you’re giving up in order to build a data analytics platform?

Whether you’re a mobile startup or an established enterprise, your main focus should always be to improve your core business. And unless it happens to be data analytics, spending your resources to create your own platform simply doesn’t make sense.

If you ran an accounting firm, would you make your own computers, develop your own accounting software, or build a car to transport yourself to work? These are all things that you’d need to keep your business going, but you wouldn’t waste your time making any of them because your main source of revenue would suffer.

Similarly, winning in today’s mobile market requires your full attention. Money is tighter than ever and if you want to succeed, you’re going to need all your company’s brain power focused on your core mobile product.

Building a functional user interface is expensive and difficult

Gathering metrics is only one aspect of what data analytics platforms do. It’s important, but what’s even more important is how you access and visualize your data.

Without a functional, intuitive and customizable dashboard, any results you get will be a confusing pile of numbers—decipherable only by your engineering team. An effective analytics platform needs to have a user interface that will let you manipulate your data. But, building one is an even more expensive and time-consuming process.

Top analytics providers spend years and have entire user experience and design teams dedicated to creating an optimal dashboard.

Remember, the whole point of an analytics platform is to make it easier to derive actionable insights from your data. If you can’t do things like tag custom events, build data funnels or follow user segments through your app, you’ll never be able to make the data-driven decisions needed to improve your product and dominate your mobile domain.

Building doesn’t mean your data will be easily accessible

Have you thought about how your data will be accessed by the rest of your organization? If not, you’re making a mistake. The best mobile analytics platforms make data accessible to every stakeholder in your company. It’s through this collaboration around data that the best insights and plans for actions are developed.

Accomplishing this requires first creating an intuitive dashboard (as discussed above) and then integrating your DIY platform either through local servers or via the cloud. Both options, by the way, will tack on another hefty sum onto your already growing expenses.

You could certainly forgo this step, but why would you want to? By making your data only accessible to your in-house analytics team, you’ll just be creating a bottleneck. Rather than being able to easily pull up data charts, retention stats or any other metric on your own, you’ll have to put in a request to your data team to pull the information you need. The same goes for every other person in your company.

You can’t build data science expertise

Hypothetically, let’s say you’re actually able to build a working data analytics platform with a fully-functional dashboard that’s easily accessible to everyone in your organization. Great, but do you have enough data science expertise to identify which data points will help you drive the most mobile customer value, increase acquisition, reduce churn or meet any other driver of your brand’s success?

Probably not.

Understanding how to properly use your data is an incredibly important element when it come to mobile customer intelligence. Having a working platform in place is only one part of the equation. If you don’t have experienced data experts who can help you separate the signals from the noise, any insights you gain are little better than educated guesses.

Similarly, if you don’t have a process in place that integrates data throughout your company’s culture and empowers your stakeholders with the knowledge and best practices for mobile, your organization will just be lost in a sea of metrics.

Bottom line, whether you’re a mobile or social app developer, building your own data analytics platform just isn’t worth it. From an economic and brain power perspective, the process is a money and resources sink.

Mobile is the future of technology and business, and smart brands know that to succeed in the space, leveraging data is an absolute necessity. So the question you need to ask yourself is: am I ready to risk the future of my business on a DIY analytics platform?


 dontbuildblind_feature_01-1To learn more tips and tricks for leveraging mobile analytics and marketing solutions in you app, download our whitepaper Don't Build Blind

In: Analytics

Subscribe To Our Newsletter:

Recent Posts