AARRR (Pirate Metrics)

AARRR or pirate metrics is a simple model for understanding five product metrics (Acquisition, Activation, Retention, Referral, and Revenue) at each stage of the user journey, from becoming a customer to referring the brand..

Entrepreneur David McClure developed the AARRR model to give startups  a limited set of metrics that would  focus their attention while allowing them to measure their success and improve their initiatives.

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Acquisition is the first stage in the funnel of pirate metrics. It refers to the metrics used to understand the channels people are using to get to your product. This is usually related to SEO, social media, ads, and other marketing campaigns. This metric tells you where your visitors are coming from.

Activation measures how many visitors or users frequently perform an action on your site, engage with your content, or use your product. Common activation metrics are: visiting multiple pages, adopting new features, or signing up for a newsletter. This metric tells you whether users are taking the actions you want.

Referral metrics look at how your visitors and customers are directing their network of acquaintances to your site or product. This is usually measured through engagement with tools like referral promotions or share links. This metric tells you if visitors or users like your product or site enough to share it with their personal relationships.

Revenue metrics measure the actual revenue users are bringing in. It helps you understand how the cost of acquiring customers compares to the cost of all other metrics categories, and who your most profitable acquisitions are. It defines whether customers are generating minimum revenue, break-even revenue, and revenue that is higher than the cost of customer acquisition. This metric tells you what percentage of your users are bringing in different levels of revenue.