Getting a startup off of the ground is a complicated task with many moving parts.
On any given day, you might be writing back-end code, designing the front-end, becoming your product’s power user, writing content, reaching out to users, writing emails, sharing on social networks, meeting people for coffee, etc.
However, at the end of the day, only one thing matters: are you making progress?
Answering this question involves measuring something. But what?
It is easy to come up with stuff to measure. And if you read startup blog posts on A/B testing, funnels, cohorts, etc., there is no doubt that you’ll come up with many more.
Pretty soon, you’ll find yourself drowning in numbers.
Measuring stuff is easy. Finding meaning in the numbers isn’t.
Using one simple metric.
The best way to manage complexity is to ruthlessly simplify.
Can you simplify everything down to one metric?
I believe that the answer may be “yes”. For the past few months on Soulmix, I have been keeping track of many numbers in a spreadsheet. As time goes by, I have found myself strongly leaning on one metric. It has become my make-it-or-break-it metric as the one thing to focus on.
My current single metric: Weekly Returning Uniques (WRU).
WRU = Weekly uniques - Weekly new visits
There are several benefits to using this metric:
- It is super simple to measure. Install Google Analytics and you are set!
- It drowns out noise. Web traffic is bursty, and many of these visits will be 1-time visits. You don’t want to count these as real visitors.
- It is a light-weight metric for engagement or retention.
The most important one of these is (3). Sure, there are better ways to measure specific types of engagement, but the fact that people are returning on a weekly basis is a prerequisite for engagement.
WRU is powerful on two levels: it encompasses product-market fit (PMF), and can be used as a measure of growth.
It encompasses PMF: If you have a stable WRU, it means that part of your market uses your product on a consistent basis. Doesn’t that sound like PFM?
Measure of growth: If you are growing your WRU, it means that you are finding ways to tap into your market, and keep them coming back on a weekly basis. At this point, it may be useful to start using the WRU rate of change is your primary metric.
What if you can’t keep a stable WRU at a meaningful number? Either you aren’t tapping into the right market, or there is a problem with your product. Bad news.
Do whatever you can to get your WRU up to some value, and then keep it stable. When it is stable, start figuring out how to up it the value while keeping it stable. It may mean acquiring new users. It may mean engaging existing users. Do whatever it takes.
What is your single metric?
I am aware that people use the terms daily/weekly/monthly active users (DAU/WAU/MAU) all over the place on the web. Unfortunately, I have no idea what an “active user” is. WRU is clear to me.
Nevertheless, it would be great to start a conversation and hear your experiences. Have you found a great single metric to use? Has it changed over time?
Learning complicated metrics are fun and all, but at the end of the day, what metrics do you live-or-die by?
I would love to hear your thoughts!
P.S. This today’s step as post 4/100 in a 100 day blogging challenge. See you tomorrow!
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