“Aarrr, aarr!” Perhaps you've seen these interjections in an adventure film whose central theme is pirates. However, despite being usually related to the way of speaking of these “high seas bandits”, they perhaps they were not truly used in real history, in addition, quite possibly, they were popularized by the work of actor Robert Newton, in the version of the classic “Treasure Island”, adapted for television in the 1950s.
Despite this, however fictitious these interjections may be and however dubious their origins, they have in themselves generated their own offspring in a different context. Today, they have, within the marketing universe, a very real and applicable connotation and whose principles are translated into acronyms, which, in turn, symbolize five conversion metrics guided by analysis of digital user behavior.
Maybe this story evolved too quickly, right? So, continue reading with us to discover everything about the AAARR Funnel and the importance of these pirated metrics for a marketing strategy!
How did the AAARR Funnel come about?
Let's start at the beginning. In 2007, Dave McClure, an investment partner at the startup accelerator, 500 Startups, and Silicon Valley investor, realized that many startups failed because they focused their attention on superficial metrics that did not necessarily provide information that could convert into results for their businesses.
And convert, in this case, is the keyword for the emergence of this model. It is an architecture designed to optimize your conversion rate, which can even work very well with a good marketing strategy CRO.
That said, McClure established a new way of looking at the marketing funnel — or flywheel, according to current parameters — making use of just 5 metrics based exclusively on user behavior and their life cycle as a consumer, which continue to make sense even more than a decade after their development.
The pirated metrics
As with several other marketing theories broken down into letters and/or acronyms, such as Kotler's 4 Ps, McClure divided his model following the same playful and functional pattern: 5 letters, one for each phase of the funnel. Are they:
A - Acquisition
The first type of measurement in this funnel corresponds to the acquisition channels used to capture leads or, later, customers. Here, the question to be asked is: “how are users getting to my website?”
There are different means by which this purchasing process can occur. Content marketing strategies, such as landing pages, newsletters and blog posts, are essential, as are social media, SEO and SEM.
This step follows the logic of being based on 3 conversion criteria, on which you should focus your efforts. Are they:
- Actions that perform best;
- Actions that generate greater volume of traffic;
- Lower cost shares.
A - Activation
At this stage, some user behaviors related to the quality of their experience on your business website are measured.
The main observation to be made at this stage should be: “Are these visitors taking the actions I want within my website?”
The focus, then, should be on providing the user with a pleasant first experience as an initial way to impact your purchasing decision process and facilitate your onboarding. But how to measure this?
Some interesting indicators are:
- Time spent on the website;
- Number of clicks on links and buttons;
- Number of accesses to other pages on the website;
- Number of subscriptions to your newsletter;
- Number of material downloads.
These are some examples of what you can measure at this stage, but feel free to choose your criteria.
As a general rule, Don’t forget to do A/B testing. If possible, do many of them to actually make improvements that have positive effects on the user journey.
A great way to optimize the metrics at this stage is to use CRO mentioned previously and whose implementations seek, precisely, to analyze, identify and carry out positive actions to increase your conversion rate.
Read too:
- CRO – Conversion Rate Optimization: what is it, how does it work?
- Landing pages and lead conversion: how to take advantage of opportunities
- How to increase the conversion rate in the sales funnel? Understand!
R - Retention
Once you've managed to attract visitors to your website and given them a good first experience, it's time to take the next step: making them maintain their interest in your product/service and interact with your offers again.
To achieve this, the oldest and most traditional digital relationship strategy still remains useful: email marketing.
Ensure, when acquiring your lead's contact, that it will become part of a flow of automation where you will be nourished with content that will be interesting to you and that will keep you warm enough to advance within your purchasing journey or even repeat this process.
For this strategy, McClure recommends doing an immediate shot (as soon as the lead enters the flow) followed by another 3 days later, another 7 days later and another 30 days later. Again, the frequency of communication is up to you, whatever works best for you.
R - Revenue (revenue)
No strategy can be considered efficient when there is no return, right? Therefore, the focus of this phase of the funnel is to measure whether users have generated revenue for your company.
It is important to analyze the ways in which a user can generate this revenue, and this largely depends on what your business model is like.
One way to measure this is to make an LTV/CAC (Lifetime Value per Customer Acquisition Cost) relationship and monitor reference values.
R - Recommendation (referral)
There are certain strategies that we can call incomparable. And the biggest example of these is perhaps recommendation marketing, in which a user becomes an advocate for your business and makes a point of recommending it to other consumers.
The popular “word of mouth” is the oldest and most efficient way of marketing products and services, with the attribute of social proof as its flagship and remaining extremely consistent.
Here, it is interesting to monitor the number of backlinks that exist for your website, as well as mentions on social networks, reviews and testimonials. Furthermore, strategies such as generating discount codes and/or promotions based on recommendations are extremely welcome.
There is, however, the suggestion that you don't go out trying to make your business viral without the guarantee that it is good and works, otherwise it could be shooting yourself in the foot.
4RevOps: AARRR Funnel Solutions
Now that you understand the functionality of pirated metrics, you may be wondering how to implement them within your business, after all, in addition to a specialized team for analysis, you will also need to make use of the appropriate tools. To this end, 4RevOps appears as an option for carrying out this type of service.
As a very experienced company in the marketing, automation and artificial intelligence sector, Mkt4edu has the best professionals and the most up-to-date tools to provide this solution.
Do you want to know more about how to use our expertise to meet your needs? Get in touch and find out how this and other services can make sense to help you bring results!
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