By Laia Cardona, on 31 October 2024
The AARRR funnel is a conversion funnel that tracks the user's journey from the moment they become aware of the brand until they become a customer. The AARRR funnel is also known as the pirate funnel or pirate metrics and is often used when implementing growth hacking or accelerated growth techniques within a company.
Phases or Stages of the AARRR Funnel
The phases or stages of the AARRR funnel are five: Acquisition, Activation, Retention, Revenue, and Referral.
- Acquisition: This is the first contact a user has with the brand. At this initial stage, they are only considered a visitor, so it's important to gather as much information as possible about them. To achieve this first contact, it's necessary to define the target customer's profile and carry out a marketing strategy that can generate web traffic. The focus should be on quality rather than quantity.
- Activation: This is the user's first experience with the brand. At this point, the goal is to get the user to interact with the company in some way, which can be achieved through content marketing or email marketing actions.
- Retention: In this third phase, the user is already familiar with the brand and knows what it offers or what to expect from it. The goal here is to keep them engaged, as the longer they stay with the company, the more revenue they will generate. A good retargeting campaign is often very effective in this stage.
- Revenue: The user has made their first purchase, transitioning from a lead to a customer. The next step is to try to increase their average purchase value through cross-selling, loyalty programs, customer-only promotions, etc.
- Referral: Finally, in this last phase, the goal is to get the customer to speak positively about the brand and recommend it to their friends and family. This means that the customer remains important even after the purchase, so to ensure they are completely satisfied, good customer service, warranty policies, and after-sales service are essential.
This marketing strategy can be applied to any business model, including startups, as the goal is to have a well-organized process that a user goes through to become a customer.
How to Apply Pirate Metrics to Your Business
To apply the AARRR funnel, you need to start by identifying and defining the pirate metrics. This can be done by answering a question associated with each of the stages: in acquisition, how do users find the brand or product?; in activation, what is the user's first experience like?; in retention, do they come back to buy again?; in revenue, what generates the most income?; and in referral, do users recommend the product or service?
Next, you need to find and use tools that allow you to collect and analyze these metrics. Once this is done, determine whether the data obtained is good or not, what goals you want to set, and start making changes to achieve them.