Pirate Metrics; A Hidden Treasure
Every digital marketer and growth hacker out there is battling to get to the treasure first. Here’s something that can help you along the way:
Aye, what aarrr Pirate Metrics?
It’s time to board the ship and explore the 5 Metric Model, also known as AARRR — hence the pirate hook — . The AARRR model is remarkably effective, both for creating a metrics framework as well as to funnel your marketing activities. It suggests marketers should focus on 5 key consumer stages and their main metrics, in order to achieve growth. The model was originally intended for growing startups, but it’s also proven to be applicable in less uncertain environments.
The AARRRrrrrr Model
Developed by Dave McClure (cofounder of 500Startups and active investor), the AARRR model suggests marketers and entrepreneurs should aim to get customers to experience five stages: Acquisition, Activation, Retention, Referral and Revenue. A single main metric (KPI) should be determined per stage, so that each stage and its goals can be easily measured and assessed.
By focussing on only 5 stages and main metrics, actions can quickly be redirected to the stage that deserves the most attention at that particular time.
The 5 Stages
Your challenge as a marketer or growth hacker is to try to determine your
1) current activities, 2) objectives, 3) main metric and 4) results, as per each stage. Based on the outcomes over a period of time, you will have to focus on optimising the one main metric per stage. For example:
Activities > How do you get your users to find you?
Main metric e.g.> % visits site
Activities > How do your users get to have a great first experience?
Main Metric e.g. > % customer conversions on website
Activities > How do you get your users to come back?
Main metric e.g.> customer lifetime value
Activities > How do you make money?
Main metric e.g. > Sales/revenue
Activities > How do you get your users to tell others?
Main metric e.g. > Viral Coefficient
When do you know you’re on the right track?
You’ve found your golden treasure when you’re able to optimise every stage and main metric.
Good luck pirates!
— — — — — — — — — — — — — — — — — — — — — — — — — — — — — —
Did you like the read? Let me know by liking and sharing!
*This article was part of the Growth Hacking Program by The Talent Institute (associated to Startupbootcamp) at the B. Startup School Amsterdam. I highly recommend this course to any graduate/junior interested in Growth Hacking / Digital Marketing, contact me via LinkedIn for more info.