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Why retention matters?
Emre Güney - Global Senior Lifecycle Manager
What is retention?
Why retention is important?
What we can do to improve retention?
Today’s Plan
What is retention?
The ability of a company or
product to retain its
customers over some
specified period.
“How do we acquire more
users?”
From this
“How do we get better at
keeping the users we already
have?”
To this
Why retention is important?
Basic approach
If users don’t return, your
entire user base will eventually
disappear due to churn.
Medium approach
CLTV = ARPU * Lifetime
Medium approach
CLTV = ARPU * Lifetime
Retention
Medium approach
Higher CLTV means higher
CAC you can spend
More sophisticated approach
It is THE ONE growth metric
that moves acquisition,
monetization and virality.
(This is important because if you improve retention, you’ll also improve the rest
of your funnel.)
Source: Reforge
Retention
drives
acquisition
Retention
improves
monetisation
Retention
builds an
acquisition
competitive
edge
As you retain more users,
those additional users take
more of the key actions that
accelerate acquisition, either
through sharing, inviting,
word-of-mouth, or creating
content.
As more of those new users
retain, more are acquired -
improving retention sets off a
self-reinforcing cycle that
drives acquisition.
You can retain a larger
proportion of a cohort, and in
doing so, make more money
from that cohort within a
given period of time, and you
can increase the length of
time that a cohort
retains, increasing LTV.
As you increase retention,
monetisation, and LTV, you
can pay more to acquire a
customer. In doing so, you
can push competitors out of
acquisition channels, open up
new channels that were
previously too expensive, and
grow faster.
How retention drives acquisition - UGC for Pinterest example
Source: Reforge
Source: Reforge
How retention drives acquisition – Usage driven virality Loom
example
How retention drives monetisation
Source: Reforge
Bad news
The average app loses 77% of users in just
3 days.
Source: CleverTap
Improving retention is really hard.
(and getting harder)
Fierce competition
Fierce competition
Source: Reforge
Channel fatigue
Source: Reforge
Monopolies
They are levering their network effects to build monopolies that have
the power to absorb any new start-up or product that could threaten
their dominance.
Source: Reforge
What we can do to improve
retention?
Phase 1
• The first 72 hours after acquisition
is the most critical, since it’s where
users get their first impression of
your product.
• Show new users the value of your
product and get them to the “aha
moment” ASAP.
Initial Retention
Phase 2
• Mid-term retention is about
forming, then reinforcing, your
users’ habits around your product.
• Eventually they won’t need
reminders to open the product,
they’ll keep coming back on their
own.
Mid-term Retention
Frequency matters
Phase 3
• This final phase of retention is
about continuously improving the
product so it stays valuable to
users. And understand your users’
needs!
• Keep finding ways to solve their
problems by adding new features,
improving UI and UX, and fixing
bugs.
Long-term Retention
A final checklist
Get your benchmarks
The most crucial ones to watch are: day 1, day 7, day 30, and month 6.
Source: CleverTap
Track the Right Segments
These three segments are key:
Source: CleverTap
Set S.M.A.R.T. Retention Goals
Create S.M.A.R.T. goals: Specific, Measurable, Attainable, Relevant, and Time-bound.
Source: CleverTap
Test, Analyse, Repeat
Focus your efforts on where users drop off and become inactive
Source: CleverTap
Test Analyse Repeat
Test your hypotheses, then analyse your results so you learn and improve.
Repeat until you see fewer uninstalls/drop-offs and more consistently active users.
Retention is a marathon, not a sprint.
Every failed experiment leads you closer to finding
the winning combinations that keep your users
loyal to your product.
Emre Güney - Why retention matters - Digital Zone 2019
Thank you.

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