Welcome, growth folks! In the fast-paced world of product growth, data is our compass, our fuel, and sometimes, our kryptonite. We wield a vast arsenal of tools and tactics, but without the right metrics guiding our aim, we're firing into the dark. So, today, we're diving deep into the essential metrics every growth hacker needs to track – the north stars that illuminate our path to user acquisition, engagement, and ultimately, product success.
But wait, hold the funnel for a sec! Before we get lost in a sea of numbers, let's acknowledge the elephant in the analytics room: context matters. The metrics that matter most for a buzzy B2C app might be entirely different for a B2B SaaS platform.
That's why, alongside each essential metric, I'll be providing some helpful industry benchmarks to give you a sense of where you stand compared to your peers.
Remember, these are just guideposts, not gospel – your specific goals and target audience will ultimately determine your success metrics.
Onward, then, to the metric mountain!
1. Acquisition: Active Users & Conversion Rates
- Metric: Monthly Active Users (MAU) and Daily Active Users (DAU)
- Industry Benchmarks: B2C apps – 20-40% DAU/MAU ratio; B2B SaaS – 3-5% DAU/MAU ratio
- Why it matters: Active users are the lifeblood of any product. Tracking MAU and DAU tells you how many people are actually using your product and how engaged they are. These metrics help you gauge the effectiveness of your acquisition efforts and identify any potential drop-offs in the early user journey.
- Metric: User retention rate (weekly/monthly)
- Industry Benchmarks: B2C apps – 30-50% weekly retention; B2B SaaS – 70-80% monthly retention
- Why it matters: Happy users stick around. Retention rates measure how well you're keeping users engaged and coming back for more. Additionally, session length is a great metric which gives you an idea of how deeply users are interacting with your product but I recommend tying it to an Action to make is more meaningful. Slipping retention or short sessions could indicate usability issues, lack of value, or ineffective onboarding.
3. Monetization: Average Revenue Per User (ARPU)
- Metric: ARPU
- Industry Benchmarks: Varies widely depending on the business model and industry (e.g., B2C freemium apps – $0.50-$5 per user, B2B SaaS – $100-$500 per user)
- Why it matters: Ultimately, growth is about driving revenue. ARPU tells you how much revenue you're generating per user, giving you a sense of your overall efficiency and scalability. Tracking ARPU alongside other metrics like acquisition cost and churn can help you optimize your monetization strategy.
4. The Conversion Cadence: Key Funnels & Micro-conversions
- Metric: Conversion rates for key user journeys (e.g., signup to paid plan, free trial to conversion) and micro-conversions (e.g., email opt-in, feature usage)
- Industry Benchmarks: Conversion rates will vary greatly depending on the specific funnel and industry, but a good rule of thumb is to aim for 10-20% conversion for key journeys and 2-5% for micro-conversions.
- Why it matters: Not every user takes a straight path to becoming a loyal customer. Tracking conversion rates for key user journeys and micro-conversions along the way helps you identify bottlenecks and optimize your user experience to improve overall conversion rates.
5. The Feedback: Net Promoter Score (NPS)
- Metric: NPS
- Industry Benchmarks: 60-80 considered good, above 80 considered excellent
- Why it matters: Your users are your greatest source of truth. NPS measures user loyalty and willingness to recommend your product to others. A high NPS score indicates a passionate user base, while a low score reveals areas for improvement. Listen to your users' feedback to understand their needs and pain points, and use it to fuel your growth initiatives.
Remember, tracking the right metrics is only half the battle. The real magic lies in understanding what the data tells you and taking action based on your insights. A/B test different strategies, iterate on your product based on user feedback, and always be learning and adapting. Only then will you truly conquer the growth mountain and reach product goals.
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