North Star Metric

Your North Star Metric (NSM) is the single metric that best captures the core value your product delivers to customers. It's the one number that, if it goes up, means your product is genuinely succeeding.

The key idea: Instead of tracking dozens of metrics and getting lost in dashboards, your entire team rallies around one metric that represents real customer value and predicts business growth.

How to identify your North Star:

1. Ask: What value do we deliver? Not what features you have, but what progress customers make with your product
2. Find the metric that measures that value - It should reflect actual usage and benefit, not just vanity metrics
3. Check if it predicts revenue - Your NSM should correlate with long-term business success
4. Test if it aligns your team - Everyone should understand how their work impacts this metric

Examples of North Star Metrics:

• Airbnb: Nights booked (measures marketplace value creation)
• Spotify: Time spent listening (measures engagement and value)
• Slack: Messages sent by teams (measures active collaboration)
• YouTube: Hours watched (measures content value delivered)

Simple process:

1. Define your NSM based on core value delivered
2. Break it down into input metrics you can influence (these become your "levers")
3. Align team work to improving either the NSM or its key inputs
4. Review regularly - Is the NSM moving? Are our actions connected to it?

Example in action: Let's say you run a recipe app and choose "Recipes completed" as your NSM (not just viewed, but actually cooked).

Your input metrics (levers) might be:

• New users trying their first recipe
• Returning users cooking more recipes
• Average recipes per active user
• Recipe success rate (did it turn out well?)

Now when deciding what to build:

• Add video tutorials? → Could improve recipe success rate → Increases NSM
• Social sharing feature? → Might increase new users → Increases NSM
• Premium recipe collection? → Could increase recipes per user → Increases NSM
• Fancy animations? → No clear connection to NSM → Deprioritize

Your North Star Metric becomes the filter for every product decision. If a feature doesn't plausibly move the NSM or its inputs, you question why you're building it.

You can use this framework for products of any size—from startup to enterprise. It works for B2C consumer apps, B2B SaaS tools, marketplaces, and even internal products. The principle is universal: find the one metric that represents value delivery and organize everything around it.

Why Product Managers Need a North Star Metric

You're tracking 47 metrics. Daily active users are up, but revenue is flat. Page views are climbing, but retention is dropping. Which metric should you optimize?

Without a North Star Metric, every team member optimizes for different things. Marketing chases signups. Product chases engagement. Sales chases deals. Everyone moves in slightly different directions, and the product lacks coherent strategy.

A North Star Metric solves this by answering one question: "What's the single best indicator that we're creating real value and building a sustainable business?"

This isn't about ignoring other metrics—it's about creating hierarchy. Your North Star sits at the top, representing the ultimate outcome. Everything else either drives it (input metrics) or benefits from it (output metrics like revenue).

The best product teams use their North Star Metric as:

• A decision filter (does this move the NSM?)
• An alignment tool (everyone knows what success looks like)
• A strategy compass (when lost, return to optimizing the NSM)
• A communication bridge (executives, teams, and stakeholders all understand it)

What Makes a Good North Star Metric?

Not every metric can be your North Star. A good NSM has specific characteristics:

Characteristic 1: Measures Value Delivery

Your NSM should reflect actual value customers receive, not vanity metrics or proxy indicators.

Bad NSM: Registered users (doesn't mean they got value) Good NSM: Active users completing core actions (shows they're getting value)

Bad NSM: App downloads (installation isn't value) Good NSM: Days active per month (engagement shows value)

Characteristic 2: Predicts Business Success

Your NSM should correlate with revenue and long-term sustainability. As it grows, the business should grow.

Test: If your NSM doubles but revenue stays flat, it's the wrong metric.

Characteristic 3: Actionable by the Team

Teams should understand how their work influences the NSM. If it's too abstract or influenced by factors outside your control, it won't drive behavior.

Bad NSM: Brand awareness (too abstract, hard to influence directly) Good NSM: Weekly engaged users (clear, actionable, team can impact it)

Characteristic 4: Simple and Understandable

Anyone in the company should be able to explain what it means and why it matters.

Bad NSM: Engagement coefficient weighted by cohort velocity Good NSM: Projects completed per team per month

Characteristic 5: Captures Growth Potential

Your NSM should have room to grow. If it's too narrow, you'll hit a ceiling and need a new metric.

Bad NSM: First-time user signups (becomes saturated as market matures) Good NSM: Total weekly active users (scales with market expansion)

How to Choose Your North Star Metric

Step 1: Identify Your Core Value Proposition

What progress do customers make with your product? What job are they hiring you to do?

• Notion: Organize work and knowledge
• Uber: Get reliable transportation quickly
• Netflix: Access entertainment anywhere, anytime
• Zoom: Connect face-to-face remotely

Step 2: Find the Metric That Measures That Value

What observable behavior indicates customers received that value?

• Notion: Documents created and shared
• Uber: Completed rides
• Netflix: Hours streamed
• Zoom: Meeting minutes

Step 3: Test Against Business Outcomes

Does this metric correlate with revenue and retention?

Ask: "If this metric grows 50% next quarter, will our business meaningfully improve?"

If yes → strong NSM candidate If no → it's a supporting metric, not your North Star

Step 4: Check for Team Alignment

Can every team see how their work impacts this metric?

• Engineers: Feature development influences usage
• Designers: Better UX increases completion rates
• Marketing: Acquisition brings new users
• Sales: Better targeting brings higher-quality customers who use more
• Support: Reduced friction increases engagement

Step 5: Look for Leading Indicators

Your NSM should predict future success, not just measure past activity.

Lagging: Monthly revenue (tells you what happened) Leading: Weekly active users (predicts revenue growth)

Choose leading indicators when possible.

North Star Metrics by Product Type

Consumer Social Apps:

• Instagram: Daily active users sharing or engaging with content
• TikTok: Time spent watching videos
• WhatsApp: Messages sent daily
• Pattern: Engagement and network effects matter most

B2B SaaS Products:

• Asana: Tasks completed per team per week
• HubSpot: Marketing qualified leads generated
• Salesforce: Deals closed using the platform
• Pattern: Value delivery through workflow completion

Marketplaces:

• Etsy: Gross merchandise value (GMV)
• DoorDash: Orders delivered
• Upwork: Paid hours worked through platform
• Pattern: Transaction volume showing marketplace health

Media/Content Platforms:

• Medium: Total reading time
• Substack: Paid subscriptions active
• Twitch: Hours of live content watched
• Pattern: Content consumption and creator economics

Productivity Tools:

• Evernote: Notes created and synced
• Todoist: Tasks completed
• Loom: Videos recorded and shared
• Pattern: Creation and completion of core objects

Real Company Examples with North Star Metrics

Example 1: Amplitude's "Weekly Learning Users"

Amplitude (product analytics platform) chose "Weekly Learning Users" as their NSM—users who discovered an insight from their data each week.

Why this works:

• Measures actual value (insights, not just logins)
• Predicts retention (users who learn stay longer)
• Aligns teams around making data actionable
• Leads to expansion revenue (teams that learn buy more)

Input metrics:

• New users completing first chart
• Teams adding more teammates
• Questions answered through platform
• Integrations connected

Result: Clear focus on making analytics immediately valuable, not just comprehensive.

Example 2: HubSpot's Evolution of NSM

HubSpot changed their NSM as they matured:

Early stage: Weekly active teams (focus on adoption) Growth stage: Marketing contacts managed (focus on value delivery) Scale stage: Customer revenue generated through platform (focus on ROI)

Key insight: Your NSM can evolve as your product and market position change. What matters in year 1 differs from year 5.

Example 3: Calm's "Minutes of Meditation Completed"

Calm (meditation app) chose completed meditation minutes, not just app opens or sessions started.

Why completion matters:

• Users who complete meditations experience benefits
• Experienced benefits drive retention and word-of-mouth
• Completion correlates with subscription renewal
• Focuses team on quality of content and experience

Input metrics:

• New users completing first meditation
• Session completion rate
• Users meditating multiple days per week
• Average meditation length

What they don't optimize: Total sessions (starting without completing shows low value)

Example 4: Miro's "Collaborative Boards Created"

Miro (online whiteboarding) focuses on boards with 2+ collaborators, not total boards or users.

Why collaboration matters:

• Single-user boards might mean trying but not adopting
• Collaboration creates stickiness (team dependency)
• Collaborative boards predict team expansion
• Network effects within teams drive growth

Input metrics:

• Teams inviting their first collaborator
• Boards with 5+ contributors
• Cross-team board usage
• Templates used for collaboration

Result: Product decisions prioritize collaborative features over solo-user features.

Example 5: Duolingo's "Daily Active Users Learning"

Duolingo optimizes for users who complete lessons daily, not just open the app.

Why daily learning matters:

• Language learning requires consistency
• Daily learners see progress and stay motivated
• Habit formation drives long-term retention
• Correlates with word-of-mouth growth

Input metrics:

• Streak completion rate (consecutive days)
• Lesson completion percentage
• Users setting daily goals
• Push notification response rate

Tactics aligned to NSM:

• Streak freezes (maintain habit during busy days)
• Learning reminders (encourage daily return)
• Bite-sized lessons (reduce friction to completion)
• Gamification (make daily learning rewarding)

Breaking Down Your North Star: Input Metrics

Your North Star Metric is the destination. Input metrics are the levers that get you there.

The equation approach:

Define your NSM as a simple equation of inputs you can influence.

Example: E-commerce marketplace

• NSM: Monthly orders completed
• Equation: (Active buyers) × (Average orders per buyer) × (Order completion rate)

Now you have three input metrics to optimize:

1. Grow active buyers (acquisition and activation)
2. Increase orders per buyer (engagement and retention)
3. Improve completion rate (checkout optimization)

Example: B2B collaboration tool

• NSM: Weekly active collaborating teams
• Equation: (Teams onboarded) × (Team activation rate) × (Retention rate)

Input metrics:

1. Teams onboarded (top of funnel)
2. Team activation (first real collaboration)
3. Retention rate (teams staying active)

The benefit: Different teams can own different inputs, all contributing to the North Star.

Common North Star Metric Mistakes

Mistake 1: Choosing a Vanity Metric

Vanity metrics look impressive but don't reflect value or predict success.

Red flags:

• Registered users (doesn't mean active or getting value)
• Page views (doesn't mean engagement or retention)
• Downloads (doesn't mean usage)
• Social media followers (doesn't mean business impact)

Fix: Ask "If this metric doubles but our revenue stays flat, would we be happy?" If no, it's vanity.

Mistake 2: Making It Too Complicated

If your team can't explain the NSM in one sentence, it won't drive behavior.

Bad: "Monthly active users weighted by engagement intensity and adjusted for cohort maturation" Good: "Monthly active users who complete core actions"

Fix: Simplify until anyone can understand and explain it.

Mistake 3: Optimizing for the Metric, Not the Value

Goodhart's Law: "When a measure becomes a target, it ceases to be a good measure."

Example: If your NSM is "messages sent," teams might add auto-notifications that technically count as messages but create zero value (or negative value).

Fix: Pair NSM with quality guardrails. "Messages sent by humans in active conversations" is harder to game.

Mistake 4: Not Connecting It to Revenue

Your NSM should predict revenue growth. If it doesn't, you're optimizing the wrong thing.

Test: Plot NSM growth vs. revenue growth over time. They should correlate. If NSM goes up and revenue stays flat, investigate why.

Fix: Validate correlation before committing. Run historical analysis or run small experiments.

Mistake 5: Setting It and Forgetting It

Your NSM isn't permanent. As your product matures, markets change, or strategy evolves, your NSM might need to evolve too.

Fix: Review your NSM annually. Ask: "Does this still represent our core value? Does it still predict success?"

Mistake 6: Having Multiple North Stars

"Our North Star is engagement and revenue and growth and retention."

That's not a North Star—that's a constellation. You can't optimize for everything simultaneously.

Fix: Choose one. The others become supporting metrics or inputs. Be disciplined about hierarchy.

How to Implement Your North Star Metric

Week 1: Define and Socialize

Day 1-2: Choose your NSM using the framework above Day 3-4: Present it to leadership and key stakeholders, explain the reasoning Day 5: Share with entire team in all-hands or team meeting

Template for communication: "Our North Star Metric is [METRIC]. This measures [VALUE DELIVERED]. When this goes up, it means [BUSINESS OUTCOME]. Everyone contributes by [HOW THEIR WORK CONNECTS]."

Week 2: Build Measurement Infrastructure

Set up tracking:

• Dashboard showing NSM prominently
• Historical trend (how we've performed)
• Current state (where we are today)
• Target trajectory (where we're heading)

Make it visible:

• Email reports to leadership weekly
• Dashboard accessible to all teams
• Regular all-hands updates on NSM performance

Week 3: Map Input Metrics

Break down your NSM:

• What drives it?
• What can teams directly influence?
• Which inputs have the biggest leverage?

Assign ownership:

• Each input metric has an owner
• Owners propose initiatives to move their input
• Initiatives tie back to NSM impact

Week 4: Align Roadmap and OKRs

Review current work:

• Which initiatives clearly move NSM or inputs?
• Which initiatives have unclear NSM connection?
• Are we spending time on the right things?

Realign priorities:

• Double down on high-NSM-impact work
• Deprioritize or kill low-NSM-impact work
• Fill gaps where NSM needs support

Using Your North Star Metric for Decisions

Feature prioritization:

For each proposed feature, ask: "How does this impact our NSM?"

• Direct impact: Feature increases core action completion → Build it
• Indirect impact: Feature improves quality, leading to retention, increasing NSM → Consider it
• No clear impact: Feature is nice-to-have but doesn't move NSM → Deprioritize

Example:

• NSM: Weekly active projects created
• Feature request: Dark mode
• NSM impact: Unclear—doesn't directly increase project creation
• Decision: Put in backlog, prioritize features that drive project creation

Resource allocation:

When deciding where to invest team time, use NSM as your guide.

Ask: "Which initiative has the highest expected NSM impact per engineer week?"

This creates a rough ROI framework focused on your key metric.

Experiment design:

Every experiment should have a hypothesis about NSM impact.

Template: "We believe [CHANGE] will increase [INPUT METRIC] by [X%], leading to [Y%] improvement in NSM because [REASONING]."

Success criteria: If experiment improves input metric and NSM moves positively, scale it. If input moves but NSM doesn't, investigate why.

Team goals and OKRs:

Frame team objectives around NSM and its inputs.

Example for engineering team:

• Objective: Increase Weekly Active Users (NSM)
• Key Result 1: Improve app load time to under 2 seconds (quality improvement)
• Key Result 2: Ship collaboration features increasing multi-user sessions by 20%
• Key Result 3: Reduce crash rate below 0.5% (retention protection)

North Star Metric vs. Other Frameworks

NSM vs. OKRs:

• NSM: The ultimate outcome you optimize for continuously
• OKRs: Time-bound objectives and measurable key results
• Relationship: Your NSM often appears in your top-level OKRs

NSM vs. Pirate Metrics (AARRR):

• Pirate Metrics: Funnel framework (Acquisition, Activation, Retention, Revenue, Referral)
• NSM: Single metric representing value
• Relationship: Your NSM is usually in the Activation or Retention stage

NSM vs. KPIs:

• KPIs: Set of important metrics across different areas
• NSM: The single most important metric
• Relationship: NSM is your #1 KPI; others are supporting KPIs

NSM vs. Goals:

• Goals: What you want to achieve
• NSM: How you measure achievement
• Relationship: Your NSM should reflect progress toward strategic goals

Evolving Your North Star Over Time

Your North Star Metric can change as your product matures:

Stage 1: Early/Finding PMF Focus: Activation and value delivery NSM Example: Users completing core action

Stage 2: Growth Focus: Scaling usage and retention NSM Example: Weekly active users

Stage 3: Maturity Focus: Engagement depth and monetization NSM Example: Revenue per user or value delivered per customer

Stage 4: Platform/Ecosystem Focus: Network effects and ecosystem health NSM Example: Total ecosystem value creation

When to change your NSM:

• Current NSM is plateauing or maxing out
• Strategy fundamentally shifts (new market, business model)
• Current NSM no longer predicts business success
• Product has evolved significantly

How to change:

• Don't change frequently (creates confusion)
• When changing, explain why clearly
• Run both metrics in parallel for 1-2 quarters
• Fully commit to new NSM once transition is complete

The Bottom Line

Your North Star Metric is your product's true north—the single number that, above all others, indicates you're creating value and building a sustainable business.

It's not about ignoring other metrics. It's about creating clarity. When everyone understands the one metric that matters most, decisions become simpler, alignment becomes easier, and strategy becomes clearer.

Three principles for NSM success:

1. Choose wisely: Your NSM should measure value delivery, predict revenue, and be actionable by teams.
2. Commit fully: Once chosen, organize everything around it—roadmaps, OKRs, team goals, and daily decisions.
3. Review regularly: Check that NSM movement correlates with business success. If correlation breaks, investigate and adjust.

Start by asking: "What's the one metric that best represents the value we deliver to customers?"

Once you have the answer, make it impossible to ignore. Put it in every dashboard, every all-hands, every strategic discussion. Make it the first thing you check in the morning.

Because when you're clear about what success looks like, achieving it becomes significantly easier.

What's your North Star?

Quick Reference Card

Definition: The single metric that best captures the core value your product delivers to customers.

Characteristics of a Good NSM:

• Measures value delivery (not vanity)
• Predicts business success
• Actionable by teams
• Simple and understandable
• Has room to grow

How to Choose:

1. Identify core value proposition
2. Find metric measuring that value
3. Test correlation with revenue
4. Check team alignment
5. Verify it's a leading indicator

Common Examples:

• Consumer: Time spent, content created, actions completed
• B2B SaaS: Active teams, workflows completed, value generated
• Marketplace: Transactions, GMV, hours booked
• Media: Content consumed, subscriptions active

Red Flags:

• Too complicated to explain
• Doesn't correlate with revenue
• Vanity metric (looks good but meaningless)
• Multiple "North Stars" (defeats the purpose)

Remember: Break your NSM into input metrics that teams can directly influence. The NSM is the destination; inputs are the levers.