Growth Marketing

Identifying your Company’s North Star Metric

Heard of Spotify, right?

It has been in the music business for a while, but they have also started pushing into the growing podcast space. 

For driving growth for this new “product”, they focussed on “average # of followed podcasts”. This metric would look at how many podcasts a user follows, which has an assumption that following a podcast is a stronger show of interest than simply playing an episode.

While for their music, they would focus on “Time Spent Listening”

This metric that organisations focus on for growth is nothing but your NORTH STAR METRIC.

It is the PRIMARY OUTCOME that HAS to grow to call our growth strategies a success.

Airbnb’s North Star Metric is “nights booked”. This captures value delivered to both guests and hosts. Facebook’s NSM is “Daily Active Users”. With more users on the Facebook platform, the team is able to optimize everyone’s feed to deliver more value to users.

Optimizing your efforts to grow this metric is key to driving sustainable growth across your full customer base. It helps teams move beyond driving fleeting, surface-level growth to instead focus on generating long-term retained customer growth.

So North Star Metric or NSM is the single metric that best captures the core value that your product delivers to customers.

But there could be many of these for your org. How do we know our NSM is THE metric to focus on for growth?

  • Your NSM should ideally impact your entire funnel. It should focus on all growth levers-Acquisition, Activation,Retention and Monetisation.
  • If it’s just increasing the numbers for your acquisition team, its not the best NSM for you.

But there is more to it.

Let’s take the case of an online learning platform that has, say, identified “No. of Daily Live Classes” as their North Star Metric. They focussed all efforts on driving this number up.


Acquisition: More organic views because of longer time duration, multiple instances, etc

Activation: More sign-ups as more branding will occur

Retention: More people will retain as due to engagement churn rate will drop

Monetization: More visibility of paid offers

But this approach to North Star Metric is still incomplete…

It misses the measurement of three elements:

  • Value your consumers get (Core Value Prop)
  • Quality of Value
  • Frequency of Value

Now consider the NSM- 

Number of Daily Classes Taken Per Member Per Week

This is a good NSM for the org as it measures all the 3 elements-

  • Value consumers get (Core Value Prop) – Number of Classes Taken Per Member
  • Quality of Value – Classes taken /Per Member
  • Frequency of Value – Per Week

Obviously, there is more to this concept than this. 

Want to explore further and decode more growth strategies with experts at leading companies and startups in India?

Then, you are a perfect fit for our next cohort.

Here’s more info about the program, if you’re curious :

Harneet Bhalla, Program Director at Xpert
He leads Growth at Glance|ex-1mg. He has empowered more than 5 Fortune 500 companies, multiple start-ups, celebrities and thousands of others through his growth marketing insights. Has been an active speaker at various forums and conferences including TEDx GLAU and IIT Bombay. Featured on a number of podcasts across USA, UK, Canada and India.