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Product analytics tools track what users do inside your product - which features they use, where they drop off, how often they return, and how behaviour differs across segments. They’re the instrumentation layer that makes funnel analysis, cohort analysis, and North Star tracking possible 📊

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The main options

Amplitude - the leading purpose-built product analytics platform. Powerful behavioural analysis, strong funnel and retention reporting, good segmentation. The go-to choice for mid-size to large product teams who need depth. Mixpanel - strong competitor to Amplitude, particularly good at event-based analytics and user-level querying. Some teams prefer its data model; the two are closely matched for most use cases. Heap - auto-captures all user interactions without requiring manual event instrumentation upfront. Good for teams who want retroactive analysis without having planned tracking in advance. Trade-off: data can get noisy. PostHog - open-source product analytics with feature flags, session recording, and A/B testing built in. Popular with engineering-led teams who want self-hosted data and a wide toolset in one place. Google Analytics 4 - widely used, free, and deeply integrated with Google’s ad stack. Better for marketing analytics and acquisition tracking than for in-product behavioural analysis. Gets less useful the further you get from the top of the funnel 💡 Pendo - combines product analytics with in-app guides and NPS surveys. Strong for customer success and product-led teams who want to act on behavioural data with in-product messaging in the same platform.

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How to choose

A few filters worth applying:
  • How much engineering resource do you have for instrumentation? Heap’s auto-capture reduces setup burden. Amplitude and Mixpanel require deliberate event planning.
  • Do you need session recording and heatmaps? PostHog and Pendo include them. Amplitude and Mixpanel don’t - you’d pair them with Hotjar or FullStory.
  • How sensitive is your data? Self-hosted PostHog gives you full data control without sending user behaviour to a third party.
  • What’s your scale? Costs vary significantly at volume. Amplitude and Mixpanel both have event-volume pricing that can escalate fast 🙌

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The instrumentation problem

The tool is only as useful as the events you track. Teams that set up a product analytics tool without an instrumentation plan end up with a mess of inconsistently named events that produce unreliable analysis. Worth investing time upfront in a tracking plan - a document that defines every event, its properties, and the questions it’s meant to answer - before you write a single line of tracking code. Lesson learned: the best product analytics setups I’ve seen weren’t the ones with the most sophisticated tool - they were the ones with the most deliberate instrumentation. A simple, well-structured event schema beats a complex one that nobody maintains.