Startup Metrics for Pirates • Acquisition: users come to site from various channels • Activation: users enjoy 1 st visit: "happy ” experience • Retention: users come back , visit site multiple times • Referral: users like product enough to refer others • Revenue: users conduct some monetization behavior AARRR! Dave McClure, Master of 500 Hats http://500hats.typepad.com/ http://www.500hats.com/ http://slideshare.net/dmc500hats/
Startup Metrics for Pirates / Startup Metrics 101, presented at Ignite / Velocity Conference (June 2008)
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Startup Metrics for Pirates
• Acquisition: users come to site from various channels • Activation: users enjoy 1st visit: "happy” experience • Retention: users come back, visit site multiple times • Referral: users like product enough to refer others • Revenue: users conduct some monetization behavior
AARRR!
Dave McClure, Master of 500 Hats http://500hats.typepad.com/
Focus on driving referrals *after* users have a “happy” experience; avg score >= 8 out of 10
Referral
Referral How do users refer others?
Referral Methods Send to Friend:
Email / IM Social Media Widgets / Embeds Affiliates
Referral Viral Growth Factor
Viral Growth Factor = X * Y * Z X = % of users who invite other people Y = average # of people that they invited Z = % of users who accepted an invitation
A viral growth factor > 1 means an exponential organic user acquisition.
Website.com
Biz Dev Ads, Lead Gen, Subscriptions, ECommerce
Homepage / Landing Page
Product Features
1. ACQUISITION
SEO SEM
Apps & Widgets
Affiliates
Email
PR Biz Dev
Campaigns, Contests
Direct, Tel, TV
Social Networks
Blogs
Domains
3. Retention
Emails & Alerts
System Events & Time‐based Features
Blogs, RSS, News Feeds
Emails & widgets
Affiliates, Contests
Viral Loops
Revenue
This is the part *you* still have to figure out… (we don’t know jack about your business)
Revenue How do you make money?
Revenue Tips
• Don’t rely on AdSense • Start Free -> Go Freemium • Subscription / Recurring transactions • Qualify your customers -> Lead generation (arbitrage) • Sell something! (physical or virtual)
AARRR!
Any Questions, Ye Scurvy Dogs?
Additional References:
• “Influence: The Psychology of Persuasion”, Robert Cialdini (book)
• “Putting the Fun in Functional”, Amy Jo Kim (etech 2006 preso)
• “Futuristic Play”, Andrew Chen (blog)
• “Don’t Make Me Think”, Steve Krug (book)
• “A Theory of Fun”, Raph Koster (book, website)
Dave McClure, Master of 500 Hats http://500hats.typepad.com/
Example Retention Goals • 1 - 3+ visits per month • 20% open rate / 2% CTR • High deliverability / Low spam rating • Long customer life cycle / Low decay • Identify fanatics and cheerleaders
Retention Tips • Email is simple and it works • BUT make unsubscribe easy • 80% subject line / 20% body text • ACTUALLY 99% subject line / 1% body text • Fanatics = virality + affiliate channel (bloggers?)