Quick answer
AARRR is a growth framework that measures five stages of the customer life cycle — Acquisition, Activation, Retention, Revenue and Referral — each with its own metric.
The five stages
- Acquisition — where new users come from. Metric: new users by channel.
- Activation — the first moment of value: created a project, sent a first message, completed a first lesson. Metric: activation rate.
- Retention — do they come back? Metric: day-7 or week-4 retention.
- Revenue — do they pay? Metrics: paying rate, ARPU.
- Referral — do they bring others? Metric: referred new users, or the viral K-factor.
The order is not a strict funnel; a user may refer someone before paying. The value of the framework is that it forces one number per stage, so a growth discussion stops being about traffic only.
Defining activation
Acquisition, retention and revenue are fairly standard. Activation is the stage teams most often leave vague, and the one that matters most early on. A good activation event:
- Happens early, usually in the first session or first day.
- Predicts retention: people who do it come back noticeably more often than people who do not.
- Is something the product can help with: onboarding, templates and reminders can move it.
Find it by comparing retention of users who did each candidate action in their first day with those who did not.
AARRR in TapCub
In business settings you map one event to each stage: sign-up, activation, payment and share. Payment defaults to the commerce purchase event; without an activation event, activation falls back to "a second active day after sign-up". You can also set annual targets for new users, activations, day-7 retention, revenue and shares.
The AARRR report then shows each stage's metrics and trends — new users, activation rate, day-7 retention, revenue, ARPU, paying rate, shares and the K-factor (referred new users ÷ active users) — with year-to-date progress against targets and a breakdown by channel. A first-touch view groups each period's new users by the channel and campaign that first brought them, and follows their activation and payment.
For a formula and a worked example for each stage, see AARRR metrics.
Common mistakes
- Starting at acquisition. More traffic into a product that does not activate or retain multiplies the leak. Fix the worst stage first.
- Activation as sign-up. A sign-up is acquisition. Activation is the first value.
- One number for all users. Split each stage by channel; paid channels often acquire well and retain poorly.
Related guides: Acquisition Metrics, Product-Led Growth Metrics and Startup Metrics by Stage.
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Growth Strategist
Explores acquisition channels, activation, and conversion experiments, turning data insights into actionable growth hypotheses and evaluation methods.