Google announced that Universal Analytics is going away and will stop to collect new hits (new data) on the 1st of July, 2023. Since many SaaS companies use Universal Analytics for acquisition analytics and Mixpanel/Amplitude for product analytics, many people are curious about what features GA4 brings and how to use Google Analytics 4 for SaaS.
In this article, I will explain why Google Analytics 4 can be an excellent solution for SaaS, based on my experience using GA4 for more than 1.5 years. I also encourage you to learn more about the primary differences between Universal Analytics and Google Analytics 4 and why more and more companies select Google Analytics 4 instead of Mixpanel.
But first, let’s start with understanding why SaaS companies don’t like Universal Analytics.
Why do SaaS companies not like Universal Analytics?
First, when referring to this, I mean that most SaaS companies use Amplitude and Mixpanel for product analytics instead of Universal Analytics. It doesn’t mean that they don’t use Universal Analytics at all. It just means that the usage of this tool was limited to answering acquisition questions. However, what happened after the user created the account wasn’t a part of this tool.
The mentioned above mainly happened because Universal Analytics was created long ago when SaaS companies didn’t exist. Still, Ecommerce companies started to grow, and the version of Google Analytics: Classic and Universal targeted mainly Ecommerce businesses.
Due to that trend, Universal Analytics was built as session-based rather than event-based analytics. It does track your website visitors’ sessions but doesn’t allow you to see the full view of the user if that user made 20-50 sessions; that is the common thing in every product.
Moreover, Ecommerce companies are not the most frequent type of online company. We see more and more companies launch their online products (including mobile apps) and sell them as a service. Therefore, such analytics solutions as Mixpanel and Amplitude became highly popular, and even Ecommerce businesses started to ask questions about lifetime value, cost per client acquisition and retention. You can’t answer these questions using Universal Analytics.
All of the above pushed Google to reconsider their analytics solution – Universal Analytics – and build a new tool – Google Analytics 4.
Why Google Analytics 4 is an excellent option for SaaS products?
The main difference between Google Analytics 4 and Universal Analytics is the measurement model. It means that if Universal Analytics had session-based, Google Analytics 4 has an event-based measurement model. It’s the same model that Mixpanel and Amplitude use. Similar to Mixpanel, GA4 has user identification.
As a result, Google Analytics 4 can answer questions about retention and LTV. We can also analyse users using their actions across their lifetime instead of just looking at sessions. If we want, we can also dive more deeply into the specific product session; for instance, in the first one, which is crucial for many SaaS companies, we can do it.
Thus, this small thing is the most viable difference between UA and GA4 that makes GA4, at least, suitable to be used by SaaS companies. Moreover, considering that there is no better tool to analyse acquisition than Google Analytics because Google has more than 85% of desktop search organic market share. It makes Google Analytics 4 an excellent option for SaaS companies.
Besides that, there are new features in GA4 that will help you to grow your SaaS business. Let’s look at them intensely.
GA4 Enhanced measurement
Firstly, Google Analytics 4 allows you to track some events automatically without placing any additional code on your website. Some of them are:
- Video Interactions
- Scroll Depth
- Website Search
- Outbound clicks
- Form Tracking (Interaction and Submission)
- File Download
Therefore, if you place your analytics code on your website (page view), you get much more from it than just page views.
Data Streams to track website, mobile sources
Secondly, Google Analytics 4 use data streams and allows you to combine usage data from multiple devices.
If you have a cross-platform product and the end customer can use it on desktop, mobile and table, you can merge data from these sources and analyse them using the user_id parameter. You can also use data stream filters in Google Analytics 4 to analyse specific device interactions.
It becomes crucial for cross-platform products since the value users receive from your product increases when your customers use them on multiple devices. Looking at metrics around that and calculating product stickiness across devices is possible with Google Analytics 4.
User and Event Parameters
Thirdly, we all remember that in Universal Analytics, events followed the structure: event category, event action and event label. It wasn’t flexible. Thus, Google changed it in GA4, and now you can set up event and user parameters the way you want.
If you want to send a sign-up event with the event parameter “authorisation method”, you can do it. It works the same way as in Mixpanel and Amplitude.
However, one thing to remember is that to use event parameters and user parameters in GA4, you will need to use custom definitions. Therefore, be mindful and structure event parameters in a way that will allow you not to go over the Google Analytics 4 limits:
- 50 custom event-scoped dimensions
- 25 custom user-scoped dimensions
- 50 custom event-scope metrics
Even if you go over the limit, remember to use BigQuery integration. This way, you can use as many custom dimensions as you want. All of them will be available in BigQuery, and you can use SQL to analyse data.
GA4 Explorations to build reports using drag&drop
Fourthly, Google Analytics 4 has an Explorations feature that allows you to build reports using a drag&drop approach. You can import dimensions and metrics into the report and add them to rows, columns, and values. Besides that, you can apply filters and use multiple visualisations available. It works the same way you can build reports in Mixpanel, Amplitude, Tableau, or PowerBI.
You can use the following visualisations:
- Free form (Tabular View, Line Chart, Donut Chart, Scatterplot, GeoMap and Bar Chart)
- Funnel exploration
- Path exploration
- Segment overlap
- User Explorer
- Cohort Exploration
- User Lifetime
Moreover, you can create and apply segments and audiences to your reports to help you learn more about your clients and improve your bottom line.
Native integration with BigQuery and other Google products
Fifthly, the fact that GA4 is a google product allows you to integrate it with the majority of Google products such as Google BigQuery, Google Ads, Google Optimise, Google Search Console and others.
This makes it a solid solution for your business because native integrations also work better than integrations via 3rd-party connectors. Moreover, native integrations are free.
You can start using BigQuery for free because free usage is available every month for data storage and analysis.
You can use Google Optimise to conduct experiments on your products also for free and analyse their results in Google Analytics 4 using the Explorations feature.
GA4 Audiences can be used with Google Ads to prevent churn
Sixthly, there are unique features in Google Analytics 4 that you won’t be able to find in Mixpanel or Amplitude, for instance, audiences. Because you can use them to run paid ads on Google Ads.
Moreover, you can create predictive audiences. GA4 uses the available users’ data to predict anomalies, future purchases and future churn.
So if you are interested in that, you can conduct Google Ads campaigns to prevent user churn and improve retention. And you can also decrease your Paid Ads budget to not target users with a high probability of upgrading from a free trial to a paid plan.
You can find many more great features in GA4 once you start to use it, but before using it, you should implement it.
How to start using Google Analytics 4 for your product? GA4 Implementation Checklist and Best Practices.
Every analytics usage starts with the proper implementation to receive accurate data. As a result, you can rely on it and make more informed decisions.
You can be interested to learn more about how to set up Google Analytics 4 or migrate from Universal Analytics to GA4 by reading the following articles available on my website:
Moreover, I recommend you think about objectives, metrics and events you need to track to improve your business. If you start to think this way, objectives first, then metrics and only after that, events and event properties, you will track what you need without missing the element or having so much data that you don’t know what to look at.
You can find some examples that can inspire you by reading more about projects I worked on with my clients.
In general, SaaS implementation is usually divided into the following blocks:
- Revenue or Purchase
- Referrals (Refer a friend program)
If you keep it in mind, you will use Google Analytics 4 successfully and improve the bottom line monthly.
Also, remember that GA4 is a flexible tool that allows you to create reports and structure the tool as needed; you can use the GA4 library to change your default reports and track the above SaaS blocks.
For instance, if you can set up the Reports snapshot to show you the core metrics of your SaaS, such as W1 and M1 retention, activation ratio, sign-up ratio, lifetime value and even LTV / CAC. It depends on how you organise it, but it’s possible.
If you need additional help with GA4 for SaaS, feel free to contact me. I will be happy to assist you with GA4 implementation for SaaS.
Google Analytics 4 is drastically different from Universal Analytics. It uses an event-based measurement model instead of the session-based model. It allows you to use GA4 for SaaS products and measure such metrics as retention, activation, and lifetime value.
Besides, GA4 has new features that use AI and ML algorithms to predict anomalies, upgrades and churn. For instance, you can build audiences to predict churn and conduct Google Ads campaigns for such users using a native GA4&Google Ads integration.
When you implement Google Analytics 4, remember to think about how you want to see data in GA4 and what metrics and events are necessary. It’s better to have a basic event setup with all core events to be focused on instead of having many events and doesn’t know what to look at.
Frequently Asked Questions
Yes, of course. You can use Google Analytics 4 to analyse SaaS product acquisition and product data because GA4 uses an event-based measurement model.
SaaS implementation is usually divided into the following blocks: acquisition, activation, revenue, retention and referrals. You should track relevant metrics for each block. For instance, trial-to-paid ratio, sign-up ratio and retention rate.