Dave McClure, the founder of 500 Startups, coined the term pirate metrics (named because of the acronym AARRR!). It refers to five metrics—acquisition, activation, retention, referrals, and revenue—that startups should focus on. The five pirate metrics for startups will help you know where to begin your analytics setup.
Acquisition is the process of gaining new users and customers, and it is the first step in the pirate metrics process. While many companies track acquisition, few take the step to track individual channels and determine how successful each one is. Your company would benefit immensely from a detailed analysis of your various acquisition channels.
While acquisition is about bringing the right people to your website, activation is all about conversion. What is the specific action you want your visitors to take–and how can you track it? Funnel reports, which are an option on many analytics software programs, can be a great way to do this.
The next pirate metric is retention, which is all about keeping your existing customers around. Learn the different ways that various businesses track retention and how to do a cohort analysis. Retention is often overlooked, but it can make or break your company.
Once you determine that your retention is high, you can focus on the next pirate metric: referrals. A referral program can be very difficult to track, so this ebook walks you through an example using Uber.
With a referral system in place, it’s time to focus on revenue, the final pirate metric. While the vast majority of companies track revenue somehow, few break it down any further than an overall number. But knowing details about your revenue, like which customers are at a break-even point, can make a massive difference for your company.
In this detailed ebook, you’ll find an explanation of each of the five pirate metrics for startups and suggestions on the best ways to track and analyze each one.
If you have a startup, these five metrics will allow you to build a company that is scalable, stable, and successful. And while Dave McClure created pirate metrics with startups in mind, these metrics can help any business grow. So whether you’re just starting out or you want to give your business an extra boost, download this ebook to help you implement pirate metrics. AARRR!