AAARRR: The New Pirate Metrics for Startup Growth Marketing

As a full-stack marketer, effectively driving growth and revenue for your business is a top priority. One powerful framework that can aid in this pursuit is the AAARRR funnel, also known as the A3R3 Funnel or the New Pirate Metrics.

This marketing framework offers a holistic approach to understanding and optimizing the customer journey, from the initial stage of awareness to the final stage of revenue generation.

In this blog, we will delve into the intricacies of the AAARRR funnel, or the NEW pirate metrics and explore how full-stack marketers can leverage its potential to drive growth and revenue.

We will discuss the specific methods and metrics associated with each stage of the funnel and provide insights on how to track and analyze customer behaviour using pirate metrics.

Full Stack Marketing

Full stack marketing refers to the practice of utilizing a wide range of marketing tactics and channels to reach and engage with customers at every stage of the marketing funnel. This may include tactics such as SEO, content marketing, social media marketing, email marketing, Influencer marketing, conversion rate optimization, and more.

Who is a full stack marketer?

A full stack marketer is expected to have knowledge of all the different marketing channels and have the ability to use them in a strategic way to achieve the business goals. It also means having the ability to track and measure the effectiveness of marketing efforts and make data-driven decisions to optimize campaigns and improve ROI.

The A3R3 Funnel – The New Pirate Metrics

The A3R3 funnel is an evolution of the old pirate metrics and it includes six stages: Awareness, Acquisition, Activation, Retention, Referral, and Revenue.

Growth marketing with AAARRR Funnel, also known as the new pirate metrics, is a powerful approach for full stack marketers to increase revenue and customer base. Each stage of the new pirate metrics has its own goals and strategies, and it is crucial for full stack marketers to understand how to move customers effectively through each stage.

The AAARRR funnel starts with the stage of Awareness, which acknowledges the importance of making potential customers aware of the business, product or service before they become actual customers. This additional stage of the pirate metrics is crucial for the full-stack marketer to understand how to effectively increase brand awareness and reach potential customers, which in turn helps to increase the chances of acquisition and conversion.

Mastering the AAARRR funnel means being able to effectively execute marketing campaigns that drive growth at each stage of the funnel, from acquiring new users to increase revenue from existing users.

The new pirate metrics are a holistic approach that helps companies understand their customer’s behaviour and optimize their business model accordingly. It can be useful for entrepreneurs, marketers, or product managers to track their progress and make data-driven decisions.

Many marketers focus on a specific stage of the AAARRR funnel, such as acquisition, and may not have a comprehensive understanding of the entire customer journey. This can lead to a narrow view of the business and limit the effectiveness of its marketing efforts.

On the other hand, a full-stack marketer would have a more holistic view of the business and customer journey, and would be able to understand the interplay between different stages of the pirate metrics.

They would be able to optimize their marketing efforts to not just drive traffic but also increase user engagement, improve retention, and drive revenue. They would also be able to track and analyze the customer journey using pirate metrics and make data-driven decisions accordingly.

Awareness

The Awareness stage of the AAARRR funnel is the first stage in the customer journey. It is the stage where a business or brand aims to make people aware of its existence and generate interest among the target audience.

The target audience, identified as the primary customer base, is the people most likely to be interested in the products or services offered by the business or brand.

Traditionally, different teams within a company handle different stages of the pirate metrics. However, as a full-stack marketer, you would be able to execute on all stages of the pirate metrics, including the awareness stage.

This means you would be able to create campaigns and strategies that attract the attention of the target audience, generate interest and optimize the customer journey with the help of pirate metrics.

You would be able to track and analyze the customer journey using AAARRR metrics, and make data-driven decisions accordingly.

A full-stack marketer would have a comprehensive understanding of the entire customer journey and be able to optimize their marketing efforts to drive growth at all stages of the pirate metrics, not just one stage.

This could lead to more efficient use of resources and a more cohesive approach to customer acquisition and retention.

Methods To Drive Awareness

The methods to drive awareness for a brand or business can vary greatly, but some common ones include:

• Content marketing: Creating valuable, informative, and engaging content that attracts the attention of the target audience. This could include blog posts, videos, infographics, and social media posts.
• SEO (Search Engine Optimization): Optimizing the website and its content to rank higher in search engine results for relevant keywords. This helps to make the brand or business more visible to potential customers who are searching for products or services related to the business.
• SEM (Search Engine Marketing): Running paid advertising campaigns on search engines such as Google and Bing. This can help to drive more targeted traffic to the website and increase brand awareness.
• Word of Mouth: Leveraging satisfied customers to promote the brand or business to their friends, family, and social networks. This can be a powerful form of marketing as it is based on trust and personal recommendations.
• Influencer collaborations: Partnering with social media influencers who have a large following in the target audience. They can help to promote the brand or business to a wider audience and increase brand awareness.
• Drip marketing: This refers to sending automated, personalized messages to potential customers over time. This could include email drips, messenger drips, or SMS drips. This is a useful way to keep customers engaged and remind them of the brand or business over time.

These are just some common methods to drive awareness for a brand or business. There are many more ways to make people aware of a business, both online and offline. For example, traditional marketing methods such as TV and radio advertising, billboards, print ads, etc.

When you look at online marketing channels, such as content marketing, SEO, SEM, word of mouth and influencer collaborations, these are quite effective methods to drive awareness.

They can help to increase visibility and reach a wider audience, but it’s important to note that the best approach would depend on the business, its target audience and its budget.

Metrics To Measure Awareness

The metrics for measuring awareness in the pirate metrics are used to track the effectiveness of campaigns and strategies aimed at making people aware of a brand or business. These metrics include:

• Impressions: This metric measures the number of times a message, such as an advertisement or social media post, is seen by people.
• Clicks: This metric measures the number of times a message, such as a link or image, is clicked on by people. This can indicate that the message has caught the attention of the target audience.
• Traffic: This metric measures the number of visitors to a website or a specific page on a website. It can indicate the level of interest in the brand or business and the effectiveness of the marketing campaigns driving traffic to the website using pirate metrics.
• Visitors: This metric measures the number of unique visitors to a website or a specific page on a website. It can indicate the level of interest in the brand or business and the effectiveness of the marketing campaigns driving visitors to the website.

Acquisition

Acquisition, the second stage of the pirate metrics, is the process of converting aware visitors into active users. It is the stage where a business or brand aims to acquire new customers and build its customer base.

This stage is crucial for the growth and sustainability of a business as it helps to increase the customer base and revenue. 

The acquisition process begins with identifying and targeting the target audience who are most likely to be interested in the products or services offered by the business or brand.

It’s important to note that not everyone who is aware of a business or brand will become an acquired user. That’s why it’s called a funnel, it funnels down the number of people as they move through the different stages.

For example, a large number of people may be aware of a business or brand, but only a smaller number will become acquired users.

Acquisition is an important stage of the pirate metrics because it helps to build the customer base and increase revenue. It’s the stage where a business or brand aims to convert aware visitors into active users and retain them in the long run.

It is a crucial stage for the growth and sustainability of a business using pirate metrics.

Methods To Drive Acquisition

There are several methods that businesses and brands can use to drive acquisition, including:

• Calls: Outreach through phone calls to potential customers can be an effective way to build a personal relationship and answer any questions they may have.
• Direct Messaging (DM): Sending direct messages through social media platforms or messaging apps can also be an effective way to build a personal relationship and answer any questions potential customers may have.
• Webinars: Hosting webinars can be a great way to educate potential customers about the product or service and convert them into active users.
• Lead Magnets: Offering free resources, such as e-books or webinars, in exchange for contact information from potential customers can be a great way to build a relationship and convert them into active users.
• Promos: Running promotions, such as discounts or free trials, can be a great way to encourage people to try the product or service and convert them into active users.
• Giveaways: Hosting giveaways can be a great way to attract people to the brand or business and convert them into active users.

All of these methods have a common theme: direct access to the user. By using these methods, businesses and brands can acquire data and build a direct relationships with potential customers.

This allows them to understand their needs and preferences, and to create a more personalized experience for them.

It’s important to note that the best approach for driving acquisition will depend on the business, its target audience and its budget.

A full-stack marketer would be able to understand the interplay between different stages of the pirate metrics and be able to optimize their marketing efforts to drive growth at all stages of the funnel.

Metrics To Measure Acquisition

Some common metrics used to measure acquisition in the AAARRR funnel include:

• Traffic: This measures the number of visitors to your website or landing pages.
• Forms Submissions: This measures the number of people who have filled out a contact form, requested more information, or signed up for a newsletter or webinar.
• Lead generation: This measures the number of leads generated through various channels such as LinkedIn, email marketing, or PPC advertising.
• Conversion rate: This measures the percentage of website visitors who take a specific action, such as filling out a form or downloading a case study.
• Cost per acquisition (CPA): This measures the cost of acquiring a new customer or user. It is calculated by dividing the total cost of a marketing campaign by the number of users acquired.

These metrics can help you understand how effectively your acquisition efforts are working, and where you may need to focus your efforts to improve them.

Activation

Activation, the third stage of the pirate metrics, refers to the process of converting acquired customers or users into active, engaged customers or users.

This means encouraging them to take a desired action such as making a purchase, signing up for a service, or engaging with the brand in some way using pirate metrics.

Activation is closely related to the acquisition stage, where the process of acquiring new customers or users for a business is done through a variety of channels such as website traffic, social media, email marketing, and advertising using pirate metrics.

Acquisition is about acquiring new potential customers or users, while activation is about turning those potential customers or users into actual customers or users using pirate metrics.

In other words, activation is a crucial step in the customer journey and it helps to turn potential customers or users into loyal and active customers or users of a business or brand.

Methods To Drive Activation

Activation can be achieved through a variety of methods such as onboarding, onboarding emails, tutorials, or free trials.

The key is to make the process as smooth and easy as possible and to give customers or users a reason to engage with your product or service.

Some additional methods to drive activation include:

• Personalization: Personalizing the user experience can help to increase engagement and activate users. This can include things like personalized onboarding, targeted messaging, and customized recommendations.
• Gamification: Adding elements of game design to the user experience can increase engagement and motivation. For example, you can add rewards, achievements, and progress bars to encourage users to use your product or service more.
• Social proof: Leveraging social proof such as customer testimonials, ratings, and reviews can help to build trust and credibility with new users. This can help to increase their likelihood of engaging with your product or service.
• Incentives: Offering incentives such as discounts, free trials, or bonuses can encourage users to take action and engage with your product or service.
• Education and resources: Providing educational resources such as tutorials, webinars, or guides can help users to understand the value of your product or service and encourage them to take action.
• Support: Providing excellent customer support can help to build trust with users and increase the likelihood that they will engage with your product or service.

It’s important to note that methods to drive activation may vary depending on the type of business, product or service, and target audience.

Therefore, it’s crucial to conduct user research, testing, and experimentation to understand which methods are most effective for activating your specific audience.

Metrics To Measure Activation

Some common metrics used to measure activation include:

• Trial conversion rate: This measures the percentage of users who have signed up for a free trial and have converted to paying customers.
• Feature adoption: This measures the percentage of users who have adopted a specific feature or functionality of your product or service.
• Engagement rate: This measures the level of engagement of users with your product or service. It can be calculated by dividing the number of active users by the number of acquired users.
• Retention rate: This measures the percentage of users who continue to use your product or service over a certain period of time.
• Revenue generated: This measures the amount of revenue generated from activated users.
• Net Promoter Score (NPS): This metric measures customer satisfaction and loyalty, it can be used as a proxy for activation. A high NPS score indicates that customers are likely to recommend your product or service to others.

These metrics can help you understand how well your activation efforts are working and where you need to focus to improve the user experience and drive activation. 

See also: A3R3 Framework: An Update to the AARRR Pirate Metrics for Startups

Revenue

The Revenue stage of the pirate metrics is where a business actually generates revenue from its customers.

In this stage, businesses need to effectively monetize their products or services, and convert active users into paying customers. 

To optimize revenue using pirate metrics, businesses need to focus on strategies to increase the value of their products and services, and improve their pricing strategy.

This can be done through offering premium features, creating upsell opportunities and developing effective pricing models that maximize revenue while still providing value to customers using pirate metrics.

It’s important to note that the revenue stage is closely linked to the previous stages of the pirate metrics, specifically activation and retention. A business will struggle to generate revenue if it can’t activate and retain its customers using pirate metrics.

Therefore, it’s crucial to have a good understanding of how all the stages of the pirate metrics work together to drive revenue and achieve sustainable growth using pirate metrics.

Methods To Drive Revenue

• Abandoned cart flows: Abandoned cart flows are a common method used by e-commerce brands to drive revenue. This is a process where a business sends an email or SMS to customers who have added items to their cart but have not completed their purchase. The message typically includes a reminder of the items left in their cart and a link to complete their purchase. This can be a powerful method to recover lost sales and drive revenue.
• Checkout flows: Checkout flows refer to the process a customer goes through to complete a purchase on an e-commerce website. Optimizing this process by making it easy, fast and secure can increase the chances of a customer completing a purchase and drive revenue. This can include things like reducing the number of steps required to complete a purchase, providing clear and accurate product information, and offering different payment options.
• Relevant product upgrades: Offering relevant product upgrades to activated users can be a way to drive revenue. For example, if a customer has been using a free version of your app, you can offer them an upgrade to the paid version that includes additional features or removes ads.
• Product bundling: Product bundling is an effective method to drive revenue. This is where a business offers a bundle of products or services at a discounted price, making it more appealing for customers to purchase multiple items. This is often used by service-based businesses, such as social media, SEO, and website development agencies, to drive revenue.
• Promotions: Promotions are a great way to drive revenue. They can be used to attract new customers and encourage existing customers to make additional purchases. For example, offering a limited-time promotion or bundle pricing can be a powerful way to drive revenue.
• Freemium model: Offering a basic version of a product or service for free, while charging for premium features or additional services can drive revenue.

These methods of driving revenue are all focused on encouraging customers to complete a purchase, whether it’s through reminding them of items left in their cart, optimizing checkout flows, offering relevant product upgrades, bundling products or services, or providing promotions.

Metrics Used To Measure Revenue

• Retainers: For a services company, tracking the number of retainers and how much they pay on a month-to-month basis is an important metric to measure revenue. This can help the company understand the amount of recurring revenue it is generating and identify any trends or changes in revenue over time.
• Paid conversions from trial users: For a SaaS app, tracking the number of paid conversions from trial users is an important metric to measure revenue. This can help the company understand the effectiveness of its trial-to-paid conversion process and identify any areas for improvement.
• Conversion rate: For an e-commerce brand, the conversion rate is a crucial metric to measure revenue. This is the percentage of visitors to the website that complete a purchase. A higher conversion rate generally means more revenue.
• Number of transactions: The number of transactions is another important metric to measure revenue for an e-commerce brand. This can help the company understand the volume of sales it is generating and identify any trends or changes in revenue over time.
• Average Order Value (AOV): The average order value is a metric that measures the average amount spent by customers during a purchase. It’s important for e-commerce businesses to track this metric to understand how much revenue each customer is generating.
• Purchases: Tracking the number of purchases is another way to measure revenue for a business. This can help a company understand the volume of sales it is generating and identify any trends or changes in revenue over time.

Retention

The Retention stage of the funnel represents the ongoing engagement and relationship with a customer after they have made a purchase. The goal of retention is to keep customers engaged and loyal to the brand, and to increase the lifetime value of the customer by encouraging repeat purchases and reducing churn.

For full-stack marketers, the retention stage is important because it allows them to continue to generate revenue from existing customers, rather than having to constantly acquire new ones.

By focusing on retention, full-stack marketers can improve customer satisfaction, reduce customer churn and increase customer lifetime value.

For example, if a full-stack marketer has made money from a customer, they will want to retain that customer by encouraging repeat purchases or by keeping them on a retainer.

If it’s a SaaS product, the marketer wants to avoid churn by keeping the customer engaged and satisfied with the product to prevent them from canceling their subscription.

Thus, the retention stage is important for full-stack marketers because it allows them to generate ongoing revenue from existing customers, improve customer satisfaction, reduce customer churn and increase customer lifetime value.

By focusing on retention, full-stack marketers can create a more stable and profitable business model.

Methods To Drive Retention

In order to drive retention for full stack marketers, there are several methods that can be used. One of the most popular methods is email retargeting. This involves using email campaigns to re-engage customers who have made a purchase.

This can include sending them personalized product recommendations, exclusive offers, or other types of content that will keep them interested in your brand.

Another popular method is SMS retargeting. This is similar to email retargeting, but uses text messages instead of emails. It can be a great way to reach customers who may not be checking their email as frequently, and can be used to quickly notify them of sales or other special offers.

Push notifications are also a great way to drive retention, especially for mobile apps. They allow you to send targeted messages to users, even when they’re not actively using your app.

This can be used to encourage them to come back and use your app again, which can help to increase retention.

Another method for driving retention is product upgrades. For example, if a paid user is really optimizing on their paid plans on the app, you may want to push them to the next upgrade to the next year of payment because they would find even more value.

This is because by offering more advanced features, you’re adding more value to the user and increasing the chances of them retaining.

Metrics Used To Measure Retention

• Contract Renewal Rate: It is a key metric to measure retention in a services business. It measures the percentage of clients who renew their contract with the company. It is an important metric because it shows the effectiveness of the services provided and the level of satisfaction of the clients with the company’s services.
• Customer Lifetime Value (CLV): It measures the total revenue a customer generates for a business over the course of their lifetime. This metric is particularly important for e-commerce businesses as it helps to understand the long-term value of a customer. It can also help to identify the most valuable customers and target them with retention campaigns.
• Net Promoter Score (NPS): It is a measure of customer satisfaction and loyalty. It is a metric that ranges from -100 to 100 and measures the likelihood of customers to recommend a company’s products or services to others. A higher NPS score indicates higher customer satisfaction and loyalty, and thus a higher retention rate.
• Churn Rate: It is a metric that measures the percentage of customers who stop using a company’s products or services within a certain period of time. It is an important metric to measure retention because it directly measures the effectiveness of retention efforts. A low churn rate indicates a high retention rate, and a high churn rate indicates a low retention rate.

These metrics can provide valuable insights into customer behaviour and help full-stack marketers to identify areas for improvement and make data-driven decisions to drive retention.

Referral

As a full stack marketer, the Referral stage of the pirate metrics is a critical part of the customer journey. It represents the final step in the funnel, where current customers are encouraged to refer new customers to the business.

This stage is particularly important because it can help to increase awareness and acquire new customers at a lower cost than traditional marketing methods.

One of the key strategies in the referral stage is to create an effective referral program. This can include offering incentives or rewards to customers who refer others to the business, such as discounts, vouchers, or cash back.

The program could also include personalized referral links that customers can share with their friends and family, which makes it easy to track referral conversions.

Another important aspect of the referral stage is to ensure that the customer experience is positive, so customers are more likely to refer others.

This can include providing excellent customer service, addressing customer complaints quickly and efficiently, and constantly improving the product or service based on customer feedback.

Methods To Drive Referral

Some common methods to drive referrals include:

• Affiliate marketing: This is a method of offering commissions or incentives to current customers for referring new customers to the business.
• Email referral campaigns: By segmenting paying and satisfied customers, businesses can send email campaigns asking for referrals.
• In-app referral prompts: Businesses can also use in-app prompts to ask customers to refer others to their service or product.
• Referral rewards program: Offering rewards such as discounts, vouchers, or cashback to customers who refer others to the business can drive more referrals.
• Social media referral campaigns: Encourage customers to share the business on social media by offering incentives or rewards for doing so.
• Word-of-mouth marketing: Encourage customers to talk about the business to their friends, family, and colleagues.
• Referral contests and giveaways: Running referral contests or giveaways can be an effective way to drive more referrals.
• Influencer marketing: Partnering with influencers and social media personalities can increase the visibility of the business, leading to more referrals.
• Personalized referral link: Create personalized referral links that can be shared by customers to refer others to the business.
• Customer loyalty program: Creating a loyalty program that rewards customers for repeat business and referrals can drive more referrals.

Metrics To Measure Referral

There are several metrics that a full-stack marketer can use to measure the effectiveness of referral campaigns:

• Number of referred customers: This is the number of new customers who have been referred by current customers.
• Referral conversion rate: This is the percentage of referred customers who actually make a purchase or sign up for a service.
• Referral revenue: This is the total revenue generated from referred customers.
• Referral retention rate: This is the percentage of referred customers who continue to make purchases or use the service over time.
• Referral lifetime value: This is the total revenue generated by a referred customer over the lifetime of their relationship with the business.
• Referral click-through rate: This is the percentage of people who clicked on a referral link and visited the website or app.
• Social shares: The number of people sharing the business on social media is a good indicator of how many people are talking about the business outside of the referral program.
• Net Promoter Score: This measures the overall satisfaction of the customers, which could be a good proxy for referral potential.
• Referral program participation rate: This is the percentage of customers who participate in the referral program.
• Referral tracking: This is the ability to track the performance of each referral source, which can help to identify which sources are driving the most referrals.

In conclusion, the new pirate metrics provide a powerful marketing framework for measuring the success of a business.

By focusing on acquisition, activation, retention, referral, and revenue, businesses can gain a comprehensive understanding of their customer journey and identify areas for improvement.

Implementing these metrics can help businesses increase customer engagement, drive revenue growth, and ultimately achieve success.

With the right tools and strategies in place, businesses can harness the power of the new pirate metrics and achieve their goals.