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How to Drive Business Growth with North Star Metric

Muyun Xiao
Product Director
Sep. 22, 2023

Driving profitable business results depends partly on your goals, especially when you have a great product. As a rule of thumb, your goals should be measurable and clear enough to provide valuable insights. However, choosing the right goal that aligns with your vision, strategy, and value proposition might be challenging.


You can navigate this obstacle with The North Star Metric. At its core, the NSM is a single metric that reflects the value your product delivers to your customers in alignment to your mission.


In our previous article, we explained the fundamentals of NSM. This article will build on those foundations and provide some practical insights into 

  • Distinctive Attributes of a North Star Metric
  • Crafting Your Unique North Star Metric
  • Practical Applications Of North Star Metric
  • Real-World Application of North Star Metric
  • North Star Best Practices for Growth

Distinctive Attributes of a North Star Metric


The North Star Metric is a unique data point that sets the stage for selecting other KPIs. However, there are some distinctive attributes an NSM should have. They include:

  • Alignment to value

A relevant North Star Metric must align with the derived value the customers get from using your product and services. You identify this by digging deep to understand the product core benefit with a direct link to customer derived value.

  • An indicator of future success

A relevant North Star Metric should always be an indicator of business future success. You should be able to derive future projections based on the NSM. For example, monthly revenue doesn’t give a clear view into the future. It only tells us about what has happened in the past. However, a NSM like daily active users can serve as an indicator to gauge the possible revenue in the future if the activity users count reduces or improves.

  • Measures the moment your customer finds value

North Star Metrics differ from KPIs as they measure the performance in terms of the specific value it provides to the customer. It allows you to monitor the level of satisfaction your customers derive from the product so you can optimize and expand product user based in the future.


Types of Industry-Specific North Star Metric Examples


North Star Metrics differ depending on your industry. Some common NSMs for popular industries are:


B2B North Star Metric

  • Churn rate
  • Net promoter score
  • Customer satisfaction score

North Star Metric for SaaS

  • Customer lifetime value
  • Monthly recurring revenue
  • Customer acquisition cost

North Star Metric E-commerce

  • Conversion rate
  • Average order value
  • Customer retention rate

Real-World Application of North Star Metric


North Star Metric plays a vital role in the success stories of many companies globally. Here are some leading business, their North Star metrics, and how it reflects the company's value proposition, vision, and mission.

  • YouTube

North Star Metric: Number of hours watched
YouTube helps give everyone a voice regardless of skill and shows them the world. They provide a platform for video creation and discoveries. The number of hours watched as their NSM aligns with this vision and is an overall measure of growth.

  • Quora

North Star Metric: Number of questions asked
Quora North Star Metric is a true reflection of this vision and helps to shed light on their growth. Moreover, optimizing this metric can improve customer loyalty, content quality, and organic growth.

  • Amazon

North Star Metric: Number of items sold
Amazon’s North Star Metric aligns with the vision of being the world's best customer-centric company. Typically, customer satisfaction will mean repeat purchases, which counts as more items sold on the platform. Subsequently, all other activities on the platform, from UI upgrades, vendor policy, payment processing, and others, will work towards optimizing customer satisfaction.

  • Facebook

North Star Metric: Daily active users
Facebook North Star Metric contributes to engagement, retention, revenue, and other KPIs. If the daily active users drop, they have a customer retention problem, which might also affect the revenue generated from ads and other services.

  • Spotify

North Star Metric: Time spent listening
Spotify's North Star Metric aligns with the value they offer users. Typically, more time spent listening to music on the app will mean more customers retained and renewed subscriptions, increasing revenue.


Crafting Your Unique North Star Metric


Crafting a unique North Star Metric starts with a deep dive into the core of your business. You need to identify the one value your business provides to your customers. As a rule of thumb, you should assess all factors or touchpoints that can negatively affect your overall business growth.


Next, conduct a survey to understand the users' definition of the value your product provides for them. This will also help you to have a customer-centric metric that aligns with your goal because, in the long run, the customers are the source of growth.


When you have defined your business vision and customer value and identified what change will look like for your business, you should design a process to map the customer interaction. This process will involve mapping out each touchpoint and the value delivered to the customers at different levels.


Subsequently, analyze these touchpoints' data using a tool like Kyligence Zen. This metric analytic tool offers an effective solution to extract helpful insight from the collected data and select the right North Star Metric. Kyligence Zen has features to help let you visualize, track, chat to NSM, and instantly check if it's healthy and aligns with the overall business goals.


Practical Applications Of North Star Metric


The North Star Metric framework has many applications in business. Here are some ways to implement it for business growth:

  • Integrating NSM into Decision-making

Integrating your North Star Metric (NSM) into decision-making begins with leveraging data-driven insight to ensure the metric aligns with your business mission. Additionally, it can prioritize strategies, projects, and initiatives based on their potential NSM impact. However, integrating NSM in decision-making relies on collaboration and team contribution. When the team is involved, you can foster cross-functional collaboration and collectively, driving progress toward a core business objective.

  • Adapting product roadmaps based on NSM insights

Adapting your product roadmaps based on NSM insights helps you create customer-centric products that fuel growth. You can achieve this customer-centricity by prioritizing features that align with the NSM. Additionally, you can extract insights by analyzing customer feedback and behavioral data and integrating information in an agile development approach. Embracing an iterative process ensures you are in sync with the NSM throughout the development cycle.

  • Formulating marketing strategies aligned to NSM

You can use the data and insight from your NSM to refine and formulate marketing strategies. At its core, the NSM can offer a deeper understanding of the customer's experience, which helps to create targeted campaigns to attract and retain them—Similarly, aligning the internet strategy to the NSM brings a tailored approach that informs your audience about your product more effectively.


Managing all the different touchpoints with Kyligence makes things easy. With this tool in your arsenal, you can track all metrics and identify anyone not aligned with the NSM. It is also effective in fostering team collaboration.


North Star Metric Best Practices For Business Growth


Here are some best practices to drive sustainable growth with the North Star metric framework

  • Align with long-term success
  • Invest in data quality and integrity
  • Reassess and update your NSM periodically
  • Use north star metrics to align your teams to a single mission
  • Reflect on customers' feedback as a guide to choosing a relevant metric
  • Regularly track, review, and adjustments metrics to align with changing conditions
  • Avoid overly complex metrics, they can confuse the team and slow down decision-making processes

North Star Metrics Examples: How Kyligence use it to Drive User Success


Our product, Kyligence Zen, is a metrics platform designed to help every business team stay on top of their business metrics performance. At Kyligence, we use the number of metrics queries per user as our north star since the more users query their metrics, the more business insights and value we can bring to our users.


On a daily and weekly basis, we use our own product, Kyligence Zen, to monitor our north star metrics and other relevant metrics such as daily active users (DAU), weekly active users (WAU), and metrics queries through different product features. We discuss actions while looking at the metrics and decide on relevant actions to improve our north star metrics as well as the other metrics.

Kyligence Zen

Each functional team also has its own quarterly business goals that we tie to our metrics performance using our Goals feature. On a biweekly basis, the leaders of each functional team (marketing, product growth, product management, sales, etc.) use Kyligence Zen’s Goal feature to report to the executive team on business performance.


Optimizing NSM Strategies with Kyligence's Zen


The concept of NSM focuses on tracking a single metric that reflects the core value your product or service delivers to your customers. At its core, tracking the right NSM helps streamline focus on what matters most, optimize product quality, increase retention, and reduce churn rate. Kyligence Zen offers a one-stop solution that helps track and analyze metrics from one location, allowing different teams to set goals and collaborate to achieve business success.

Kyligence Copilot

Similarly, product teams can chat with Kyligence copilot to extract insight without advanced knowledge about analytics. Boost your business growth with data-driven decision metrics. Try Kyligence Zen for free.