Glossary term
North Star Metric
A measure intended to represent the core value customers receive from a product over time.
Also known as: NSM, north star
A North Star Metric gives a company one useful view of whether customers are receiving more value from the product.
The metric should reflect meaningful customer behaviour rather than activity that happens to be easy to count.
It does not replace revenue, profit, retention or other business measures. A company usually needs to understand both the value customers receive and the value the business captures in return.
The metric does not need to explain the whole company. It needs to be useful enough to improve decisions.
