AARRR

Dave McClure's AARRR framework organizes customer measures around Acquisition, Activation, Retention, Revenue, and Referral. It encourages a few actionable measures tied to the actual customer lifecycle. The stages can overlap or occur in different orders; the lowest conversion percentage is not necessarily the most valuable improvement opportunity.

AARRR becomes useful when each label corresponds to a real event in a customer's experience. Acquisition might mean a qualified visit rather than any impression; activation should represent an initial encounter with value rather than merely opening an account. Define the population and time window before comparing percentages, because different denominators can make a funnel look better without helping anyone.

Use the map to locate a decision, not automatically to optimize the smallest percentage. A modest improvement at one stage can be valuable or irrelevant depending on volume, cost, customer fit, downstream retention, and what the team can change. In noncommercial settings, adapt the relevant stages explicitly rather than inventing a revenue objective.

When to use it

When building or iterating on products; when evaluating market opportunities; when deciding resource allocation; when scaling operations.

How it can help

Directly applicable to building, launching, and scaling products and businesses. Helps prioritize actions, identify market opportunities, and build sustainable competitive advantages.