An overload of numbers. The data you get from your ads, CRM software or website analysis scares you off. We know the feeling! But by putting the data aside, you miss a lot of opportunities.
We will tell you how to start by examining all those figures in 3 steps:
- First of all, you determine your North Star Metric. What is your objective? And which figure projects its success?
- Once you know your north star metric, you determine the Key Performance Indicator (KPI) for each phase in your funnel.
- And finally, you display the KPIs and the NSM in a clear dashboard.
Piece of cake, right?
NSM FTW (North Star Metric for the win…)
What exactly do you want to achieve with your company in the short term? Don’t get tricked by certain vanity metrics, but assign a valuable actionable metric as NSM.
The goal of the NSM is to initiate sustainable growth. In that case, the customer lifetime value increases, and the churn decreases. Put yourself in the shoes of your customers before determining the NSM. How do they use your product and what added value do they get from it? You will have to find out which NSM will work best for now by trying various metrics.
Hila Qu gives you 5 tips in this interesting blog post to determine your North Star Metric:
- The metric should indicate that your user experienced the core value of the product
- It should reflect user’s engagement and activity level
- It should be the “one thing” that indicates the business is heading in the right direction
- The metric ideally should be easy to understand & communicate across teams
- Don’t fall into the trap that you have to have a perfect North Star Metric. What you are trying is to find here is a metric that makes most sense for the entire business to focus on, and it might take a few iterations to finally find the right one.
Assign KPIs to your funnel
What does your funnel look like? With all the sights set on the North Star Metric, growth hackers use the pirate funnel. It reads as follows: “AAARRR” (Awareness, Activation, Acquisition, Revenue, Retention, Referral).
Now you need to translate each phase for your company into a specific KPI, taking into account your North Star Metric. We use Facebook as an example. Facebook has daily active users as NSM. What does this mean in the funnel? which KPIs does Facebook link to the different phases?
Activation and retention are therefore very important phases for Facebook if they have DAU as NSM. But it will not stay the same NSM forever. it is important to adapt your NSM to the objectives of your company.
A dashboard to frame
Finally, you know which metrics to look for, scrape them from your infinite tables. To display this data in a clear structure with your NSM in mind, you should create a dashboard. Google Data Studio is a handy tool for visualizing metrics and evolutions! With Google Data Studio you can easily implement data from Google Analytics and Google Sheets.
Unfortunately, you can’t frame your dashboard and hang it above your bed. Your dashboard is dynamic and changes automatically.
No idea how to start such a dashboard? Read this enlightening blog and discover the basics of Google Data Studio.
As you can see in this diagram from GrowthTribe, growth hacking starts with one thing: data. But why?
It helps you find opportunities you would miss otherwise. Your gut feeling does not always give you the proper direction to go. All data results from facts. This allows you to objectively validate your assumptions. But it is extremely important that you interpret the data correctly.
Once you figured out a strategy by analyzing your data, you will continue step by step in the growth sprint. Creative marketing, automation, and behavioral psychology are the next topics to which you will apply your strategy. When you have taken all these steps, your growth sprint is complete. And now you do it all over again. 🤓
Growth hacking is an iterative process in which you optimize and refine your previous sprint. It is not unavoidable to start all over again after one sprint. But by trial and error, you will get your results!
So now you know what to do with all those numbers! Do not delete any data, because who knows, they might come in handy after all. If you set up a new North Star Metric for example… 😉
Would you like to discuss your North Star Metric and KPIs with us? Get in touch with Simon Meers!