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Written on 4/28/2022

Written on December 9, 2023




One of my favorites on this list is the B2B product Intercom, which enables over 30,000 companies to communicate with potential and existing customers through their apps, websites, social media and emails.    
One of our customers, a Fortune 100 retailer, is attempting to expand its mobile retail business and has identified this as a strategic priority for their future. North Star Metrics captures teams when someone orders through their mobile app and their current strategy focuses on delivering the best experience for the customer, receiving value for their delivery and processing payment without logistics, complaints, or returns issues. As SaaS companies with an independent business model such as Dropbox or HubSpot, their metrics study accounted for 3% of the users who were active in week 1.     
The North Star metric measures how your customers value the product best, represents your current product strategy at its core and is a leading indicator of future business results that are important to your business. It is a single metric that achieves what users have proven to be a guaranteed success of your product and indicates an increased retention rate that is higher than your current retention rate for onboarding users.     
If your metric data point your company in the right direction for long-term, healthy growth, then it will make sense for your team to shift your focus to this direction. Your priorities and other objectives will give your whole team a common goal to work towards, and there will be less disagreement and less confusion.     
Key metrics focus on your growth efforts, serve as seeds for the growth of the enterprise ecosystem, give you deeper insights into the behavior of your customers, and create levers to drive future growth. A North Star metric is a single metric that captures the key value your product delivers to customers best. Of all metric metrics, your North Star Metric (NSM) is the one that summarizes this core value and is the core measure of your company's growth best.     
Optimizing your efforts to increase the North Star metric is the key to sustainable growth for your entire customer base. If your North Star metrics work well, your company will be more likely to remain true to the core values reflected in your company's internal mission statement. Measuring progress is not progress, and organizations using North Star Metrics can be distracted from the day-to-day business of individual projects.     
Cross-silos relationships and a willingness to prioritize the company are good for teams and good for employees, but reject the North Star metric when employees change their behavior (as many sales teams do when their compensation structure presents a conflict of interest). User-friendly analysis teams that have access to the whims of the company should not be informed that the company has been successful or has not corrected its course. Revenue is not disclosed, and lying to the company that it is ahead in the earnings game for a short-term boost can have long-term negative consequences.     
In the case of e-commerce, companies often measure purchases to indicate that buyers have completed their journey and improve each part of the journey (discovery, browsing, checkout, speed, etc.). For each customer will result in higher revenue. The assumption is that when your customers receive high value, they stay and buy more, which alludes to more companions in your organization. The risk of turnover in an NSM is that you are more interested in extracting as much from your customers as possible in the short term than from customers who feel value and pay more in the long term.     
These indicators are indicators that best capture the core value of the products and services a company offers its customers. Most teams in an organization play a role in providing added value to customers. If your company has a clearly defined mission to meet the needs, and a unique value proposition to meet those needs, all the better, or at least you should.     
In this sense, the value line you offer your customers is the biggest driver of sustainable long-term growth and is directly related to their commitment to your product.     
We hope that this article will serve as a guide for product leaders and managers around the world to see why North Star Metrics is important, how to define it and how to use it to drive your long-term product strategy and growth. North Star metrics are important metrics for the success of the product team and the company. The metrics of product vision serve as a key measure for the current product strategy.     
It is simplistic to try to reduce an entire company to a single number. To understand why, take your metrics and brainstorm how different people and teams within your company act to optimize them. One can assume that people will do everything they can to find more complicated ways to optimize the numbers.     
We want to see a big overlap in the support metrics tree, which means that one part of the delivery team does something that contributes to the company's top KPIs while another is focused on delivering more value to customers.     
Once the entire team has understood the NSM, the next step is to define the input metrics to continue to grow. The OMTM not only measures how value is delivered and recorded, but also identifies the key indicators that enable this growth. It steers the focus from the tactical implementation of NSM to top business KPIs and sets strategic goals.     
During a growth strategy workshop with one of my clients, I noticed that the term "North Star Metrics" was relatively unknown. It is true that companies with complex business models often have multiple North Stars, but they often consist of sub-indicators. In this article I will explain what a North Star metric is and how to find the most powerful North Star metric for your business, so that you can bring a new focus and energy to your entire business.     
North Star Metric (NSM) is a powerful concept that emerged among Silicon Valley companies with burgeoning growth in recent years. It helps teams move away from ephemeral, shallow growth and focus on generating long-term customer growth. Just as Slack helps with collaboration in the office and the task of organizing teams, Slack is an NSM for the messages that are sent within the organization. 

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