More data does not mean better information. Drive product growth with a metric that guides you to success.

The opinions expressed by entrepreneurs contributors are their own.

As companies continue to crack down on how companies handle user data, it's time for the business world to think about what exactly they collect and measure. The country's strict laws make it harder to store and manage Chinese consumer data, but it could also have wider ramifications if other countries decide to adopt similar regulations (much like the General Privacy Regulation). EU data). This will lead to a new digital landscape when it comes to data and metrics.

Not so long ago, marketing and growth teams relied on just a few metrics to analyze campaigns and measure business performance: revenue, expenses, and profit. Then the internet exploded, bringing everyone into the information age. The rapid proliferation of data collection tools and methods has created something of a feeding frenzy.

Marketers and product teams started capturing and measuring everything they could get their hands on. Their intentions were good: they believed that if they collected all the available data, then voila these metrics would reveal what worked and what didn't in their products. In practice, however, they simply created a game of "finding the needle in the haystack". And unfortunately, there is no victory in this game.

When it comes to product growth metrics, more is not always better. Having too many metrics is as bad as having none at all. You only have to look at the amount of data people generate to see why. Research estimates that humans will collectively create over 180 zettabytes of data by 2025. To put that into perspective, that equates to storing 2,587 iPhone 13 Pro per second (1 terabyte model).

Imagine the resources and time it would take to track that much data. In addition, some information may be old or outdated. Other measures may be readily available but ultimately lack relevance and practicality. Ultimately, you're data-rich, but information-poor: that's not a good position.

Why do you need a North Star metric?

Rather than chasing any metric that seems remotely related to your product, consider centering your product growth strategy around a single guiding metric. Just as sailors used the North Star located directly above Earth's North Celestial Pole to navigate the oceans, you can use a North Star metric to align your team around the primary goal of growing the product.

Of course, sales, engineering, product, and marketing teams can always have their own sub-goals and metrics. But having that bright North Star overhead keeps everyone moving in the same general direction. Because a North Star indicator is focused on overall revenue growth, there is a built-in level of team-wide transparency and camaraderie not found in other industry-specific initiatives. team.

However, what makes a North Star metric such an effective measure of success is its intrinsic relationship with users. By definition, a North Star metric is the number that best reflects the value your product provides to users. Therefore, your teams will always be aligned and working together to develop your product.

Related: Customer Experience Will Determine Your Business Success

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