ALE2012 - Pirate metrics AARRR

AARRR – PIRATE METRICS There  is  no  way  back!  

WHAT IS THE PROBLEM YOU ARE TRYING TO SOLVE?

WHAT IS YOUR MOST IMPORTANT CUSTOMER SEGMENT?

WHO IS YOUR BEST CUSTOMER?

WHY IS THIS YOUR BEST CUSTOMER?

HOW DO YOU (PLAN TO) MAKE YOUR MONEY?

HAVE YOU COLLABORATED WITH YOUR (POTENTIAL) CUSTOMERS?

WHO TRIED THIS BEFORE?

WHAT IS YOUR MOST USED FEATURE?

THERE IS NO WAY BACK!

YOU’RE DOING TOO MUCH

DON’T HANG ON TO THINGS THAT YOU MIGHT BUILD SOMEDAY

CREATE HYPER FOCUS

KILL A FEATURE EVERY  WEEK  

TAKE OUT A FEATURE AND MONITOR THE REACTIONS

OPTIMIZE FOR HAPPINESS

Either  they  love  it  or  hate  it,  all  other  reac;ons  means  you’re  screwed  

THERE IS NO WAY BACK!

AARRR Dave  McClures’  

NARRATIVE OF YOUR STRATEGY, PROGRESS

Create  different  storylines  for  different  combina;ons  

EXAMPLES Let’s  take  a  look  at  this  meta-­‐framework  

#1 DOGGIECOLR

Social Network for Dog Lovers Makes money through advertising and affiliate sales of lush dog collars.

Key business drivers Advertising and affiliates need large traffic/page views so growth and referral are key.

VISIT

SIGN-UP

CREATE PROFILE

POST PICTURES COMMENT

SHARE PICTURES

INVITE FRIENDS

BUY COLAR

ACQUISITION

ACQUISITION

ACTIVATION

ACTIVATION

REFERRAL

REVENUE

#2 AGILESAMBA

Project management tool for Agile startups Makes money through monthly subscriptions. Has a free trial period.

Key business drivers Conversion to paid users.

VISIT

SIGN-UP

CREATE PROJECT

UPGRADES PAID

CANCELS ACCOUNT

ACQUISITION

ACQUISITION

ACTIVATION

REVENUE

REVENUE

ACQUISITION Let’s  take  a  closer  look  at  this  meta-­‐framework  

ARE YOU FISHING IN THE RIGHT POND?

HOW DO YOU GET NEW CUSTOMERS?

IS YOUR MESSAGE REACHING THE RIGHT PEOPLE?

ARE YOU FOCUSSING ON THE RIGHT PEOPLE?

ACTIVATION

ARE YOU USING THE RIGHT BAIT?

HOW DO YOU LAND POTENTIAL CUSTOMERS?

IS YOUR MESSAGE CLEAR?

ARE YOU HELPING YOUR CUSTOMERS?

RETENTION

DO YOU USE THE RIGHT MATERIAL?

HOW DO YOU MAKE CUSTOMERS STAY?

DO YOU OFFER THE RIGHT EXPERIENCE?

DO YOU OFFER QUALITY?

REFERRAL

HOW DO YOUR FISHES LURE IN MORE FISHES?

HOW IMPORTANT IS WORD OF MOUTH?

HOW EASY IS IT FOR CUSTOMERS TO SHARE THEIR EXPERIENCES?

REVENUE

SELLING YOUR FISH

HOW DO YOU (PLAN TO) MAKE YOUR MONEY?

ARE YOU CATCHING THE RIGHT FISH?

TIME TO START MEASURING AND LEARN

THERE IS NO WAY BACK!

VANITY METRICS Metrics  that  make  you  feel  good  but  don’t  tell  anything…  

Google  Analy;cs  

TechCrunch  

WHAT WOULD INDICATE SUCCES?

Let  us  examine  Facebook…  

•  150  000  Users  •  Numerous  superior  compe;tors  •  …  

WHAT WOULD INDICATE SUCCES?

Let  us  examine  Facebook…  

•  75%  of  the  users  visit  the  site  1  or  mul;ple  ;mes  a  day  •  1  month  aUer  the  launch  in  a  student  campus  they  could  acquire  90%  

of  the  student  body  

•  150  000  Users  •  Numerous  superior  compe;tors  •  …  

Metrics that matter!

•  Value  Hypothesis  à  How  do  we  add  more  value  to  our  customers  live?  

•  Growth  Hypothesis  à  Through  what  engine  will  we  acquire  new  customers?  

Metrics that matter!

•  Value  Hypothesis  à  How  do  we  add  more  value  to  our  cusotmers  live?  

•  Growth  Hypothesis  à  Through  what  engine  will  we  acquire  new  customers?  

Metrics  are…  -­‐  Ac;onable  -­‐  Auditable  -­‐  Accessible  

COHORT Fact:  New  users  are  more  engaged!  Group  users  in  month  or  week.  

A-B TESTING Let  different  groups  of  customers  validate  different  new  features  

RATE OF VALIDATED LEARNING

Experiment,  validate  learning  &  change!  

VIRAL COEFFICIENT Focus  on  Acquisi;on  &  Referral  –  Revenu  is  side  effect  

Viral  Coeff  =  Invites  *  Conversion  Rate  Examples:  Facebook,  Hotmail…  

LIFETIME VALUE (LTV) Focus  on  Ac;va;on  &  Reten;on  –  Payment  is  central  

LTV  =  Cost  of  Acquiring  Customer  /  Earnings  from  that  customer  Examples:  Amazon,  Match.com…  

Recommended Software

•  Ubounce  •  KISS  Metrics  •  Survey.io  •  Wufoo  •  LinkShiUr  •  …  

WE DONT’T KNOW ENOUGH!

WE’RE DOING TO MUCH!

USE AARRR TO BUILD THE NARRATIVE OF YOUR STRATEGY!

Acquisi;on  Ac;va;on  Reten;on  Referral  Revenue  

FOCUS ON REAL METRICS

Metrics  are…  -­‐  Ac;onable  -­‐  Auditable  -­‐  Accessible  

GO OUT AND COLLABORATE WITH YOUR CUSTOMERS!

THERE IS NO WAY BACK!