Organizing requirements needs to be aligned with the current stage of the enterprise and carried out according to actual business objectives and scenarios. For example, for enterprises that have not yet established a systematic metric system or whose data infrastructure is still incomplete, it is necessary to start by setting objectives and then develop a comprehensive plan. For enterprises with a certain foundation, scattered information and complex requirements need to be organized and then consolidated into a single growth plan.
To build an effective metric system, it is recommended to follow these steps:
Define the North Star metric for growth → Map the user journey → Organize team business scenarios and core metrics → Break down metrics

As the name suggests, the North Star metric is the most important metric for the company at this stage, guiding all personnel to move in the same direction. The business objectives of all teams within the company, and even the phased tasks of individuals, all contribute to the improvement of the North Star metric.

1.1 The role of the North Star metric #

• Guides direction
  Regardless of the size of the company, a clear and unified data metric is needed as guidance to ensure that all teams can clarify task priorities, thereby effectively focusing efforts and addressing key priorities.
• Improves the ability to take action
  Setting a data metric can significantly improve the ability to take action, lay the foundation for further engagement with customers, and accelerate the pace.
• Guides business insights and experimentation
  Through this data metric and its breakdown, business growth bottlenecks can be identified and corresponding solutions developed, such as launching targeted growth experiments to form a closed loop for growth.

1.2 Criteria for defining the North Star metric #

• Improvement of the metric indicates that the company is moving in a positive direction.
  First, the selected North Star metric must align with the current stage of company or product development. For example, during the early stage focused on customer acquisition (emphasizing new users), the mature stage focused on revenue (emphasizing revenue conversion), or the saturation stage (emphasizing retention), and so on. Second, the North Star metric should be able to reflect the overall business performance and trends from a macro perspective, rather than only representing a partial view. A typical example is a company with a two-sided market business model. For instance, the North Star metric for a ride-hailing company should reflect the supply-demand balance between drivers and passengers, such as "total rides taken."

• It should indicate whether users are experiencing the core value of the product.
  The core value refers to the pain points the product solves for users and which needs it fulfills. For example, for e-commerce applications, the core value is online shopping, so the North Star metric should be related to user purchasing behavior, such as GMV (gross merchandise value) and average order value.

• Lagging indicators vs leading indicators

  Lagging indicator	Leading indicator
  Generally, these refer to the metrics used to measure the results we want to achieve. The reason they are called lagging indicators is that by the time we obtain the data, all events have already occurred and the results are available, so these indicators are always lagging.	Leading indicators are predictive, which means that once a leading indicator changes, we can infer how lagging indicators will change as a result. Leading indicators are controllable; we can influence them through our own efforts to achieve the desired lagging indicators.

  For example, some video products may use monthly membership fee revenue as the North Star metric. This is a lagging indicator, because users may continue to pay monthly fees but not be active. Therefore, it is possible to consider using leading indicators such as "weekly active users" as the North Star metric. This allows issues in the business to be identified more quickly, avoiding situations where users have already stopped using the product for a long time and are about to cancel their subscription before any action is taken.

1.3 Examples of common business models and North Star metrics #

After defining the North Star metric, the next consideration is how users progress step by step within the application to reach the specific behavior represented by the North Star metric and experience the product's core value. To achieve this, we can outline the main user journey.
The following two examples illustrate this:

• Mobile games
  For mobile game products, assuming the North Star metric is defined as average play time per user and the corresponding user behavior is "playing the game," users may need to go through the following steps:
  1. Access the application
  2. Register an account
  3. New user onboarding
  4. Play the game
  5. Level up and continue clearing stages
• E-commerce
  For e-commerce products, assuming the North Star metric is set as GMV and the corresponding user behavior is "paying for an order," users may go through the following steps:
  1. Access the application
  2. Register an account
  3. First purchase
  4. Repeat purchase
     The user's purchase process can be further broken down into: click on an advertisement/promotion slot → view the product detail page → click to purchase → submit the order → pay for the order. Segmenting the user journey prepares for the next step of organizing business scenarios.

The user journey forms the backbone of the growth model, and product, operations, and marketing teams continuously develop, execute, and iterate strategies based on this journey to help each team achieve their respective KPIs and improve the North Star metric. Among these, different teams will be involved in different business scenarios. We can systematically organize these scenarios and then build the corresponding metric system based on them.
Continuing with the e-commerce product example, assuming its North Star metric is set as GMV. Teams can enumerate the following common business scenarios:

For each functional team, the core metrics of interest in specific scenarios can be further broken down into multiple sub-metrics and key dimensions, improving the overall metric system and making it easier to identify growth issues when analyzing data. Based on the business scenarios and metrics listed above, we will select one scenario from each team or function as an example for demonstration:

A comprehensive indicator system will help ensure the logical consistency and completeness of subsequent tracking solution design, ensuring that the tracked events and attributes can be used to configure metrics relevant to different teams in various business scenarios, generating business insights.