Growth Rate

Growth rate shows by what percentage a metric grew or shrank from one period to the next; the simplest measure of change over time.

Growth rate looks simple but several hidden decisions shape its reading. First, the comparison base: growth versus the previous period or versus the same period last year? For any seasonal metric, comparing to the prior period is misleading and it must be read year over year. Second, a small base: a hundred-percent growth on a tiny number looks striking but is meaningless; the growth percentage must always be read beside the absolute number. Third, compound versus simple: a compound growth rate over several consecutive periods tells a different story than a single-period jump. The big trap is extrapolating a short growth rate into the future; growth rarely stays linear, and projecting one good month into a year is exactly the error that produces optimistic forecasts. Unlike subscription-revenue metrics, growth rate on traffic, sessions and users is fully buildable from behavioral data.