North Star Metric (NSM) – Guiding Long-Term Focus
Purpose: To align the team around one core metric that reflects value creation.
What It Is
A North Star Metric is the single most important measure of your product’s long-term success — the metric that captures how well you’re delivering value to users.
When To Use It
- During strategic planning and OKR alignment
- When teams lose clarity about success
- To prevent focusing only on vanity metrics
How It Works
Choose a metric that reflects value delivered, not just activity.
| Company | North Star Metric | Why It Matters |
|---|---|---|
| Spotify | Time spent listening | Indicates user engagement and satisfaction |
| Airbnb | Nights booked | Reflects both host and guest value |
| Slack | Messages sent in teams | Shows active collaboration and adoption |
| Notion | Active docs created | Represents real product utility |
Example: SaaS Startup
A task management tool tracks “tasks completed per active user per week” as its North Star Metric — ensuring the product drives productivity, not just sign-ups.