Blog 02 May 2022
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The Growth Hacking strategy is generally based on the “AARRR” method invented by Dave McClure. This framework consists of five steps on which companies focus in order to boost their growth. In each of these steps, it is important to define the KPIs (performance indicators) to be analyzed and monitored. If you want to know more about growth hacking, we have a page dedicated to growth hacking techniques. This helps you to find the most effective hacks to generate leads.
In this article we explain each step of the AARRR funnel and the KPIs to track:
The first step of the AARRR method focuses on acquiring new users. This is the most important stage of your Growth Hacking strategy. Indeed, users are a key element of your company’s growth.
To attract them, use a few lead generation techniques, including SEO, social media, referral marketing and SEA. In addition, use automated tools, such as Kaspr, which allows you to retrieve contact information from your prospects automatically.
At this stage, the KPIs to follow are :
The number of users: focus on the channels that bring the most users for a successful Growth Hacking strategy.
The activation rate per acquisition channel: select the channels that generate the most active and qualified leads (registered to your newsletter, downloaded your content…).
The cost per user (the total costs incurred per channel divided by the number of users channeled): this indicator allows you to know which channels have a positive ROI.
By analyzing these three KPIs, you can determine the most effective and profitable acquisition levers.
The second step of your Growth Hacking and lead generation strategy is to activate the interest of new users. This means you need to conduct marketing actions to turn new contacts into leads. The purpose of this activation action is to retain these users. To achieve this, use dedicated marketing techniques such as newsletters, landing pages, gamification, etc.
In order to define the most effective channels, follow two main elements, namely the interest and desire of your users. Thus, you can analyze the retention rate, the average session duration or the type of page views per session. These KPIs explicitly illustrate the level of interest in your product or service.
Next, check the KPIs that measure the desire of users for your offering. This can be the newsletter subscription rate, the usage rate of a feature or the RSS feed subscription rate. Indeed, these actions are supposed to push new visitors to return to your site.
Once you know the interest and desire of your new users, you need to perform marketing actions to retain your active users. Focus on the recurrence of your users’ activity. Take into account the usage cycle of your product or service.
Thus, to retain your active users, you can use different growth hacking techniques, in this case targeted emailing, publishing automatic targeted messages on LinkedIn via Kaspr, etc. Retention KPIs to track include:
the number of visits per month of a user;
the number of days since the last activity or visit.
At this stage, the goal is to measure and improve the frequency of activity of your active users.
Instead of investing all the time in generating new leads, you should encourage your active users to tell their friends and family about your brand. You can indeed use Growth Hacking levers to multiply your audience at a reduced cost.
On LinkedIn, for example, it is possible to set up a referral program by rewarding those who invite new users. The objective is to turn active users into real ambassadors of your offer/brand/company.
At this stage of the AARRR method, the elements to analyze are virality and sponsorship. You should check the number of social shares per user, new sessions and shared publications per user.
On the sponsorship side, it is important to track the number of referrals per active user, the number of active referrals per active user, etc.
At this last stage, your engagement process should be well set up. You can then focus on revenue. Determine the best technique to improve the conversion rate of users to leads/subscribers/customers. Your main goal is to increase the average revenue generated per user.
In order to maximize your revenue, you need to analyze the factors that impact the conversion of a user to a customer/subscriber. These are prices, promotions, persuasion techniques, offer optimization, etc.
You also need to drive upselling or create new revenue streams to improve your revenue. At this stage, the KPIs to track are conversion rate and average revenue per customer.
The Final Word
As part of establishing the Growth Hacking strategy, the AARRR method helps you to more simply define the KPIs to track to optimize your growth. Moreover, you are free to adapt the indicators of each scope of this framework to your business. The objective is to quickly develop your business and increase your turnover. To know more about growth hacking, you can read the article on the ba.b.a of growth hacking.