The Hierarchy of Engagement: Metrics Every Growth Hacker Should Be Watching

The Hierarchy of Engagement: Metrics Every Growth Hacker Should Be Watching

In the world of growth hacking, it's all about finding the most effective strategies to drive user engagement and ultimately, growth. But how do you measure the success of these strategies? While total users, daily active users (DAU), and monthly active users (MAU) may seem like important metrics, they are actually just vanity metrics that don't provide any real insight into your growth rate or the quality of your users.

So what metrics should growth hackers be watching? Let's dive into the hierarchy of engagement and explore some key metrics that can truly help you understand the impact of your growth efforts.

1. Daily Net Change: Assessing User Growth, Re-engagement, and Retention

One metric that provides valuable insights into your growth rate is the daily net change. This metric tells you on a daily basis how much your user base has grown or shrunk. By analyzing this metric, you can assess new user acquisition, re-engagement, and retention, and easily see the impact of each component on your current growth rate.

To calculate the daily net change, simply subtract the number of users you had yesterday from the number of users you have today. This metric gives you a clear picture of how your user base is evolving over time.

2. Core Daily Actives: Focusing on Regular and Engaged Users

While total user numbers may be impressive, they don't necessarily reflect the quality of your user base. That's where the metric of core daily actives comes in. This metric focuses on users who have been consistently using your service on a regular basis.

To calculate core daily actives, count the number of users who used your service today and have also used it five or more times in the past four weeks. By tracking this metric, you can get a better understanding of how many of your users are truly engaged and loyal to your product.

3. Cohort Activity Heatmap: Tracking User Retention Over Time

One of the most insightful metrics on this list is the cohort activity heatmap. This metric shows how your user retention curve has changed over time. By analyzing this heatmap, you can identify any changes in user retention and take appropriate actions to improve it.

The cohort activity heatmap is created by tracking the conversion funnel for important flows on a daily basis. This allows you to detect any adverse changes in user retention, as even a small difference of a few percentage points can compound over time.

Putting It All Together: Actionable Advice for Growth Hackers

Now that we've explored these key metrics, let's summarize three actionable pieces of advice for growth hackers:

1. Focus on quality, not just quantity: Instead of chasing vanity metrics like total users, prioritize metrics like core daily actives that reflect the engagement and loyalty of your users.

2. Monitor user retention over time: Use the cohort activity heatmap to track changes in your user retention curve. This will help you identify any issues and take proactive steps to improve user retention.

3. Analyze the impact of your growth efforts: By calculating the daily net change, you can assess the effectiveness of your user acquisition, re-engagement, and retention strategies. This will allow you to make data-driven decisions and optimize your growth efforts.

In conclusion, growth hacking is all about finding effective strategies to drive user engagement and growth. By focusing on the right metrics, such as daily net change, core daily actives, and the cohort activity heatmap, growth hackers can gain valuable insights into their growth rate and the quality of their user base. By taking actionable steps based on these insights, growth hackers can optimize their strategies and drive sustainable growth.