Business Metrics
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AARRR
Pirate Metrics: Acquisition, Activation, Retention, Referral, Revenue. A five-rung growth frame that stops teams staring at one vanity number.
Detailed explanation
Popularized by Dave McClure, the model asks a different question on each rung: how they arrive, when they first get value, why they stay, whom they bring, where they pay.
Teams often talk only acquisition (ads). Weak activation burns media. No retention makes LTV fictional.
Each product defines the rungs differently. On a content site, activation might be understanding a term or subscribing; revenue might be proxied by the email list.
Frequently asked questions
- Which rung do you fix first?
- The clogged one. If new users never get first value, buying more traffic is waste.
- Do you watch all five at once?
- Yes, but weekly focus is one rung. Inflating five KPIs at once kills action.
Related terms
Internal links for the topic cluster — read these concepts together.
- FunnelA Funnel is a marketing model that visualizes the stages a potential customer moves through from first encountering a brand to making a purchase, and is used to analyze user drop-off at each stage.
- RetentionThe share of users who come back after a given time. It carries repeat behavior and habit, not a one-off sale.
- North Star MetricA North Star Metric is the single, top-priority performance indicator that best reflects a company's long-term success and the core value it delivers to customers.
- Referral ProgramA growth mechanic that rewards existing users for bringing new customers. Unlike paid media, it transfers trust.
- ActivationThe moment a new user first gets real value—the “aha”. Signing up is not activation; the first meaningful action is.
- OnboardingThe welcome path that helps a new user understand the product and reach first value. It is a road to activation, not a pile of tutorial slides.