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What the North Star Metric is: Tips and Next Steps

Allan Porras

Jun 11, 2023 — 3 min read

A North Star Metric (NSM) is a single metric that captures the core value that your product delivers to customers. It is the one number that you use to measure the success of your product.

The NSM should be specific to your business and easy to understand and measure. It should also be accessible for all your team members to understand and communicate, even if they don't work in data science or analytics.

Having a clear NSM helps everyone in the organization stay aligned around what matters most when making decisions about new features or products — which will ultimately make them more successful by bringing them closer to their users' needs.

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How to Choose Your North Star Metric

There is no one-size-fits-all answer to this question, as the best NSM for your business will depend on your specific goals and objectives. However, there are a few things to keep in mind when choosing your NSM:

It should be aligned with your business goals. Your NSM should be a direct measure of your business's success. For example, if your goal is to increase revenue, your NSM might be the number of paying customers you have.
It should be specific and measurable. Your NSM should be specific enough that you can track it over time, and measurable enough that you can see how it changes in response to your efforts.
It should be relevant to your customers. Your NSM should be a measure of value that is important to your customers. For example, if your product is a social media platform, your NSM might be the number of active users you have.

How to Use Your North Star Metric

Once you have chosen your NSM, you can use it to guide your product development, marketing, and sales efforts.

Product development. Your NSM can help you prioritize new features and improvements. For example, if your NSM is the number of active users, you might focus on features that will help you increase user engagement.
Marketing. Your NSM can help you target your marketing campaigns. For example, if your NSM is the number of paying customers, you might focus on marketing to people who are likely to be interested in your product.
Sales. Your NSM can help you track the effectiveness of your sales efforts. For example, if your NSM is the number of new customers, you might track how many new customers you acquire each month.

Tips for Using Your North Star Metric Effectively

Track it over time. The best way to see if your NSM is working is to track it over time. This will help you identify trends and make adjustments to your strategy as needed.
Set goals. Set goals for your NSM and track your progress towards those goals. This will help you stay motivated and focused on your objectives.
Communicate it to your team. Make sure your entire team understands your NSM and how it is used to measure the success of your product. This will help everyone stay aligned and working towards the same goal.

Top Books to Learn More About the North Star Metric

Here are some of the best books to learn about the North Star metric:

The Startup Owner's Manual by Steve Blank and Bob Dorf.
Traction by Gabriel Weinberg and Justin Mares.
The North Star Playbook by Sean Ellis and Morgan Brown.
Measure What Matters by John Doerr.

These books provide a comprehensive overview of the North Star metric and how to use it to measure and improve the success of your product. They also include case studies and examples from companies that have successfully used the North Star metric.

In addition to these books, there are a number of other resources available online that can help you learn more about the North Star metric. These include articles, blog posts, and videos from companies such as Amplitude, HubSpot, and Intercom.

The North Star metric is a powerful tool that can help you grow your business. By learning more about the North Star metric and how to use it effectively, you can align your team, focus your efforts, and track your progress towards your goals.

4Geeks: A Great Growth Marketing Partner for Enterprise and VC-Backed Startups

4Geeks is a growth marketing agency that helps enterprise and VC-backed startups grow their businesses. We have a team of experienced professionals who are experts in all aspects of growth marketing, including product development, marketing, sales, and customer success.

We work with our clients to develop a custom growth marketing strategy that is tailored to their specific needs and goals. We then implement that strategy and track its progress to ensure that our clients are getting the results they want.

Conclusion

A North Star Metric is a powerful tool that can help you grow your business. By choosing the right NSM and using it effectively, you can align your team, focus your efforts, and track your progress towards your goals.