How to Set Up Product Analytics in Amplitude
Amplitude is one of the most powerful product analytics platforms available. Setting it up correctly from the start saves months of cleanup later. The key is a well-designed event taxonomy: a structured naming convention for all the events your product tracks.
This guide covers the full setup process, from event taxonomy design to building your first actionable dashboard.
Step-by-step guide
Step 1: Design your event taxonomy
Before writing any code, define your event naming convention. Use a consistent format like "noun.verb" (e.g., project.created, prd.generated, ticket.exported). Group events by feature area. Document every event with its properties and when it fires.
Step 2: Instrument core user actions
Start with the actions that define your product's core value: user signup, first key action, repeated engagement, and conversion. Do not instrument everything at once. Start with 15-20 core events and expand as needed.
Step 3: Set up user properties
Configure user properties that matter for segmentation: plan type, role, company size, signup date, first value date. These properties let you segment your analysis by user characteristics.
Step 4: Build your first funnel
Create a funnel from signup to first value moment. For most products, this is: Signup > Onboarding Complete > First Core Action > Repeated Use. Identify where users drop off and prioritize fixing those gaps.
Step 5: Set up retention analysis
Configure a retention chart based on your core action. For a PM tool, this might be "Created a project" as the start event and "Returned to the workspace" as the return event. Track weekly and monthly retention.
Step 6: Create a dashboard
Build a dashboard with your key metrics: DAU/WAU/MAU, core funnel conversion, retention curves, and feature adoption rates. Share this dashboard with the product team and review it weekly.
Common mistakes
Instrumenting everything
Tracking every button click and page view creates noise. Focus on events that represent meaningful user actions and business outcomes. You can always add more events later; removing noisy events is harder.
Inconsistent event naming
Mixing formats (click_button, buttonClicked, button.click) makes analysis painful. Choose one convention and enforce it. Document your taxonomy in a shared spreadsheet or wiki.
Not tracking the first value moment
The most important metric for most products is time to first value: how long it takes a new user to experience the product's core benefit. If you do not track this, you cannot optimize onboarding.
Tips
- Use Amplitude's Taxonomy feature to manage and govern your events
- Set up real-time alerts for critical metrics (e.g., signup conversion drops below 10%)
- Create saved cohorts for your key user segments (power users, churned users, new users)
- Review your event taxonomy quarterly and deprecate events that nobody uses
How Vantage helps
Vantage connects to Amplitude to pull analytics data into PRD generation. When you create a project, your product analytics ground the AI-generated PRD in real user behavior. This means your specs reflect what users actually do, not assumptions about what they might do.