The so-called Pirate Metrics were first presented in 2007 by entrepreneur and angel investor Dave McClure, which bring together the following five phases of a customer lifecycle:
- 1 . Acquisition: How/through what is the user acquired?
- 2 . Activation: How/through which the user is activated and a first positive experience is created?
- 3 . Retention: How/through which the user comes back?
- 4 . ReferralHow does the user recommend the product?
- 5 . Revenue: How/through what does the user generate a revenue?
As you as an attentive reader have probably noticed, the name “Pirate Metrics” is derived from the first letters of the respective phases: AARRR. What now bspw. exactly is an “Acquisition” or an “Activation” always depends on the respective product.
In the context of digital transformation, it is essential to continuously measure and analyze data in order to understand exactly how your own digital products, services, order lines, etc. are performing. Data-driven ways of working can continuously optimize the “funnel” from visitor to customer to improve conversion rates from top to bottom. As you can see in the graphic, the funnel gets narrower and narrower from top to bottom. Of course, conversion rates drop from top to bottom at all stages from which a simple visitor becomes a paying customer.
Of course, there are other important metrics besides these five categories, but the Pirate Metrics lend themselves primarily as a first pitch from a product and marketing perspective. Even if no other metrics are measured, at least these should be.
The so-called Customer Factory Blueprint, developed by Ash Maurya, offers a slightly different representation.
Here, the business model is metaphorically represented by a factory. Essentially the same metrics are used, but here the funnel is supplemented by pictograms and non-linear loops. This makes it easier to visualize a customer’s path.
