Goals setting is crucial to the success of a startup as it ensures everyone stays focused and moves forward in the same direction. Conversely, not having goals significantly hurts the organization as it leads to a lack of focus and scattered priorities. There are three things to consider when setting goals.
1. Defining success
What does success look like? This entirely depends on what stage the startup is in (before product-market fit, at what growth stage, etc), what kind of startup it is (SaaS, consumer, etc), the CEO's vision and other factors. The commonality is tying the core goals to the main business objectives, discussed during the one-on-ones with the CEO and team leads. While most marketing objectives tend to fall into one of two themes - brand-building or revenue generation, and they are not mutually exclusive. Define success by limiting the number of goals, which will allow the team to get things done. And setting these goals is as important as setting up a way to reach them.
2. Objective key results (OKR)
The OKR methodology is used by companies like Google, Atlassian, Intel and Airbnb to name a few. OKRs work effectively by helping startups stay aligned to the overall goals, prioritize effectively and keep things measurable and data-driven. If you're curious about what this entails, watch how Google sets goals and check out a deep dive into OKRs for growth and marketing specifically.
The most important thing to remember when setting goals is to be customer and growth-centric. Focus on how your objectives add value to the customer in a way that leads to growth.
3. What to measure
OKRs help set the course, but there is no universal truth when it comes to answering what exactly should be measured. Since most successful startups are customer-centric, developing metrics around the customer lifecycle tends to be most effective for sustained growth. 500 Startups founder Dave McClure's pirate metrics "AARRR" has a widely-used framework that's useful as a starting point.
Because metrics are not "one size fits all", asking these questions helps in discovering what to measure.
Note: Before jumping into acquiring users, it's important to know who the target audience is.
- What channel (direct, referral, organic, paid, social) is driving the most traffic?
- What channel is driving the highest converting traffic?
- What channel has the lowest customer acquisition cost (CAC $)?
- What is the AHA moment that leads to conversion?
- How many of your customers keep coming back? Why?
- What's the churn rate? Why are you losing these customers?
- How can you turn your customers into advocates and evangelists?
- How can you increase revenue and decrease CAC?
Knowing what to measure is as important as having accurate data sets. We'll be chatting about the importance of having accurate insights and how to make the most of your data soon. But first, let's take a step back and talk about the two journeys a startup should be focused on in order to achieve sustainable and, often, viral growth here.