This article is a compilation of my writing on my previous blog (www.growthpresso.com), which planned to migrated into this website. I write around 5 article about AAARRR, and here are the compilation result of that five.
Growth Metrics AAARRR 101
You may or not familiar with the pirate metrics or we also called it AAARRR (triple A, triple R). This metrics is popular in the startup ecosystems, and has been modified into many forms, as some make it AARRR, AAARRR, or RARRA, and so on.
So what is all of this metrics mean? This metrics will help you to grow your startup or company and usually use by either growth hacker, digital marketer, up to VP and CEO. Basically this metrics covers from when target audience just aware of your brand up to when they become a referral (brand advocate).
Since there are a lot of version of this pirate metrics, I will create disclaimer that the pirate metrics that I share here is a modified version that add Awareness phase in the beginning, because I think it’s very important to know which channel you want to use make the target audience know your product/brand awareness. Also with additional notes that because my industry is in the e-commerce, this pirate metrics will modified to fit the needs and objective of the e-commerce business model, and I will use the e-commerce as the main example in this usage of modified pirate metrics.
Here is the diagram of AAARRR modified pirate metrics, and it’s actually a funnel, which is an extension from the traditional marketing funnel (awareness, consideration, conversion), instead this funnel covers a lot in detail the process a user of a startup product usually experiences.
Here is the brief explanation of AAARRR Funnel (modified version, based on E-commerce business model).
Awareness
In this phase, our main objective is to make the target audience know your brand/product/business, and then become aware of it.
Acquisition
Next step is to make the target audience visit your website/app, so this step is actually simply the traffic acquisition.
Activation
This is important step that have the goals to make the target audience or website visitor sign up and create a new account at your website.
Revenue
If you are in e-commerce, this one is considered one of the most important, since this is our revenue coming from, so the objective obviously to make new registered user convert to customer (1st time buyers), and attract top quality new customer (visit + sign up + do purchase).
Retention
This is simple, the more customer do repeat order, the more your business profitable, and able to grow, and this avoid you burn to much money for any new transaction. So the goal is to simply make your customer repeat order.
Referral
For this last step, we want our customer to invite their friend to sign up and buy.
To put it simply, the goals of all this effort is to maximize your funnel strategy, each step of the funnel should have dedicated campaign to ensure the customer move from the top of the funnel (awareness) to the bottom of the funnel (revenue, retention, referral), and with that being said you can scale your business/brand/startup and ensure their growth in a more structured way, since you will know where to improve, and how to improve it in this framework.
AAARRR Traffic Source and Digital Channel
It is very important to choose the right traffic source or ads platform or digital marketing channel, because it is like choosing the right tools to do the gardening, as you can’t choose a shovel to cut the grass.
The right selection of digital marketing channel will contribute to the maximum results of the funnel stage itself. It will make your marketing budget effective & efficient.
So here is our version of important digital marketing channel to consider for each step of the funnel:
AWARENESS Traffic Source
The goals in this phase is to make the target audience know your brand/product/business, and the main digital marketing channel are:
- Social Ads | FB, IG, Tiktok, Twitter —> brand awareness objective, reach objective.
- Video ads | Youtube Ads
- Display | Google Display Network Ads (GDN)
- Display | 3rd Party Display Network
- Special Case | Google Search Ads —> focus keyword special campaign, contoh: [tea], [green tea]
- Influencers / Key Opinion Leader
- Digital PR Article.
ACQUISITION Traffic Source
The goals in this phase is to make the target audience visit your website, and the main digital marketing channel are:
- Social Ads | FB, IG, Tiktok, Twitter —> Traffic objective
- Display | Google Display Network (GDN) —> Maximize clicks
- Display | 3rd Party Display Network
- Native Ads
- SEO (unpaid)
- Social media organic, youtube organic, blogs (unpaid) | first time IG visitor
ACTIVATION Traffic Source
The goals in this phase is to make the target audience sign up and create a new account at your website, and the main digital marketing channel:
- Social Ads | FB & IG
- Google Display Network (GDN)
- Social Media Organic
REVENUE Traffic Source
The goals in this phase is to achieve:
- Make new registered user convert to customer (1st time buyers)
- Attract top quality new customer (visit + sign up + do purchase)
- Increase revenue, lower CAC, and increase LTV
The digital marketing channel to consider:
- Search Ads
- Google Shopping Campaign
- RTB
- Display | Google Display + Catalog
- Display | GDN
- Social Ads | FB & IG
- Email Marketing / Email Automation / Drip email campaign
RETENTION Traffic Source
The goals in this phase to make customer repeat order, and the obvious digital marketing channel to consider:
- Social Ads | FB & IG
- Display | GDN
- Video Ads | Youtube Ads
- Email Marketing (Email Newsletter, Retention Email Campaign for specific user sign up, Retention Email Automation)
- Push Notification (Web & App)
REFERRAL Traffic Source
The goals in this phase is to make customer invite their friend to sign up and buy, and the main digital marketing channels are:
- Email Marketing
- Social Media Organic | IG, FB, YT (YouTube)
- Social Ads | FB & IG
- GDN
That is the digital marketing channel or traffic source that we use in every step of the funnel in order to grow our product/startup/business.
AAARRR Audience Targeting
After we talk about how to choose the right traffic source in here, we should now know how to target the correct audience or segmenting the audience based on the each funnel level. You may ask why this is important, it is so important so that we are frequently saying that this is one of the top skill that a digital marketer should have.
For example, you don’t want to deliver too much of your awareness ads for the target audience that already know your brand for so long, that will be such a waste of resources, right? Also vice versa with you don’t want to deliver too much of your conversion ads OR the retention ads into the target audience that never know or never aware of your brand or products before.
Our main goals is to deliver our massages through paid (e.g: digital ads) or unpaid media (e.g: email) to the correct target audience based on each AAARRR funnel level. Because the right process of segmenting the target audience will contribute to the maximum results of the funnel stage itself, and it will make your marketing budget effective & efficient.
With that being said, here is our version of how we segment our audience for each step of the funnel:
AWARENESS Audience
The goals in this phase is to make the target audience know your brand/product/business, and how we segment the audience are:
- Broad Audience (zero interest targeting) —> if you have a lot of capital/budget to spend.
- Google Display Network & Youtube Ads | In-Market, Affinity, Keyword, Similar.
- Social Ads | Saved audience based on interest, LAA based on customer email.
- Demographic, Geographic, Psychographic (Interest).
- Using Brand Awareness objective OR Reach.
ACQUISITION Audience
The goals in this phase is to make the target audience visit your website, and how we segment the audience are:
- Google Display Network (GDN) | In-Market, Affinity, Similar.
- Social Ads | Saved audience based on interest, LAA based on customer email.
- Using Traffic Objectives.
ACTIVATION Audience
The goals in this phase is to make the target audience sign up and create a new account at your website, and how we segment the audience are:
- Social Ads | FB & IG | retargeting campaign with conversion objective and register/sign up as conversion goals optimization, retargeting for website visitor w/o sign up.
- Google Display Network (GDN) | retargeting for website visitor w/o sign up.
REVENUE Audience
The goals in this phase is to achieve:
- Make new registered user convert to customer (1st time buyers)
- Attract top quality new customer (visit + sign up + do purchase)
- Increase revenue, lower CAC, and increase LTV
And how we segment the audience are:
- Search Ads | our ads triggered based on keyword (just choose the geo, demo, language)
- Google Shopping Campaign | triggered based on keyword
- Google Smart Shopping Campaign | machine learning/AI will automatic target the web visitor.
- Real Time Bidding | machine learning/AI will automatic target the web visitor, and show product they see before.
Retargeting audience (website visitor w/o atc, checkout, or purchase) is valid to target for all the following channel:
- Display | Google Display + Catalog
- Display | GDN
- Social Ads | FB & IG | + additional FB & IG page engaged.
- Email Marketing / Email Automation / Drip email campaign
RETENTION Audience
The goals in this phase to make customer repeat order, and how we segment the audience are:
- Audience: Customer or Buyers or Purchasers. (upload their email or phone number in a secure way into the ads platform). Customer that already done at least 1 purchase and so on.
REFERRAL Audience
The goals in this phase is to make customer invite their friend to sign up and buy, and the main digital marketing channels are:
- Make customer invite their friend to sign up and buy.
- Audience: Customer or Buyers or Purchasers (email address).
That is the audience segment that we use in every step of the funnel in order to grow our product/startup/business.
AAARRR Metrics
Now we will talk about the important metrics to measure in the AAARRR funnel. This should be track in the first place, and need to be routinely supervised.
We aim to better month to month, but if there is a setback or drop, at least we should know the reason, e.g: Eid or Christmas will bring CPC increase by 25%, and effect everything.
So here is our version of important metrics for each step of the funnel:
AWARENESS Metrics
The goals in this phase is to make the target audience know your brand/product/business, and the main metrics are:
- Branded Search Volume (Google Trends)
- Mentions in Social Conversations (Socialbakers App)
- Brand Recall Lift (Facebook Ads Manager)
- Increase/Decrease in Brand keyword (Organic results & Search ads) & Direct Traffic
- Impressions, Reach, Frequency.
ACQUISITION Metrics
The goals in this phase is to make the target audience visit your website, and the main metrics are:
- CTR
- CPC
- CPM
- Page Views, Sessions
- Bounce Rate, Session Duration
- Assisting Conversion (Google Analytics)
- Top Conversions Path (Google Analytics)
ACTIVATION Metrics
The goals in this phase is to make the target audience sign up and create a new account at your website, and the main metrics are:
- Sign Up Rate OR Register Rate (New Register/Total Visitor in a month)
- Sign Up Rate per campaign type (search, display, social, video, native) AND specific campaign
- CAC (cost to acquire 1 new registered user) per campaign level.
- Assisting Conversion (Google Analytics)
- Top Conversions Path (Google Analytics)
REVENUE Metrics
The goals in this phase is to achieve:
Make new registered user convert to customer (1st time buyers)
Attract top quality new customer (visit + sign up + do purchase)
Increase revenue, lower CAC, and increase LTV
What to track, supervise & improve:
- GMV or Revenue per campaign level OR in general level
- CAC (cost to acquire 1 new customer) per campaign level
- Transactions (Trx) per campaign level OR in general level
- Basket Size OR Average Order Value (AOV) per campaign level OR in general level is OK
- Monthly Active Customer (MAC) in general level
- LTV (lifetime value)
- We measure it using a unique voucher code.
- Conversion (GA)
- Assisting Conversion (GA)
- Top Conversions Path (GA)
RETENTION Metrics
The goals in this phase to make customer repeat order, and the main metrics are:
- Retention Rate over N days
- Cost of Retention
- Repeat Visit Rate
- Conversion (GA)
- Assisting Conversion (GA)
- Top Conversions Path (GA)
REFERRAL Metrics
The goals in this phase is to make customer invite their friend to sign up and buy, and the main metrics are:
- Participation Rate = customer who have referred / customer invited to referral
- Referral Rate = total referral / customer who have referred
- Acceptance Rate = successful referrals / total referrals initiated
- That is the metrics that we usually use to track, supervise & improve on the routinely basis in order to grow our product/startup/business.
AAARRR Content Strategy
We want to give the right messages to the right people at the right time using the right platform. Isn’t that all the marketer dreams?
After we talk much about choosing the right traffic source and how to segment the audience, now is the time to talk about what content or messages that we need to sound on every level of the AAARRR funnel.
The good analogy is like when a man meet a woman, and he attract to her, then the sensible way is to warm up the relationship by greeting her first, introduce himself to her, talking a little bit, ask for a number, ask for a next date, and the next date, until they become a couple. Of course, it’s very inappropriate for a man to ask a woman to marry him in the introductory level or even first date. This analogy by the way is pretty much the same with the content strategy on the funnel level, as you just can’t force people to purchase by using the discount offer or bombastic offer to the audience on the awareness level. You can, but it will not much of effective.
So let’s jump on it, here is our version of how we decide our content strategy for each step of the funnel:
AWARENESS Content
The goals in this phase is to make the target audience know your brand/product/business, and our content strategy are:
- DO: Tell your story about your brand, what is your unique selling proposition, and all about your branding.
- DON’T: Avoid telling your price, discount, and offer to the people who don’t aware of you before.
ACQUISITION Content
The goals in this phase is to make the target audience visit your website, and our content strategy are:
- DO: Make your content clickbait, so they will click on the link (organic or paid) and see what is the messages in the landing page OR see the product collection in your website.
- DON’T: This is kinda gray area, since you can use many clickbait content coming from your USP or story or branding, but let just make USP, story and branding goes to your awareness level.
ACTIVATION Content
The goals in this phase is to make the target audience sign up and create a new account at your website, and our content strategy are:
- DO: Show the benefit that the audience will get when they are sign up or register or creating a new account in your website or app or platform (e.g: getting voucher, etc).
- DON’T: Avoid unnecessary chit chat about usp and story again, and just please go straight to offer the benefit!
REVENUE Content
The goals in this phase is to achieve:
Make new registered user convert to customer (1st time buyers)
Attract top quality new customer (visit + sign up + do purchase)
Increase revenue, lower CAC, and increase LTV
And our content strategy for this funnel level are:
- DO: In this funnel, just release all of your best offer which is Hardsell, Price, Discount, Offer.
- DON’T: Don’t be shy, it’s time to sell sell sell, hard sell!
RETENTION Content
The goals in this phase to make customer repeat order, and our content strategy are:
- DO: In this funnel, just release all of your best offer which is Hardsell, Price, Discount, Offer, and also unique product offer, and product launching.
- DON’T: Just make sure that you give something new, and something unique to this segment of audience, as they can be bored if you are just doing a routine.
REFERRAL Content
The goals in this phase is to make customer invite their friend to sign up and buy, and our content strategy are:
- DO: Show benefit of what you will get if you refer someone.
- DON’T: Avoid unnecessary chit chat about USP and story again, and just please go straight to offer the benefit!
And that is our content strategy in every step of the AAARRR funnel. Hope it’s useful!
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