5 ways to improve user retention

1. User Retention and Churn

1. What is user growth?

User growth is the difference between growth and churn.

A survey by Bain & Company in the United States shows that in the business world, a 5% increase in customer retention means a 30% increase in company profits, and the probability of selling products to old customers is three times that of selling to new customers. Therefore, retaining existing customers is better than acquiring new customers.

Most companies are good at attracting users. The number of users grows rapidly in the early stage, but the retention curve decreases instead of rising. This shows that the product quality is not up to standard or even the business direction itself is not feasible.

2. Reasons for low user retention

There are program loopholes and performance bottlenecks: such as registration failure, installation failure, major function errors, or failure to run on popular models, etc., which can cause immeasurable user losses. This also confirms one point: try not to promote on a large scale before reaching the PMF state, and don't spend money to grab market share without a mature product as a basis.

Users are frequently harassed: A simple application will gradually become bloated and stacked with modules as its development stage changes. Its originally light and simple texture will inevitably carry more and more business goals. If the means are blunt and the user experience is not taken into consideration, it will lead to user harassment and cause user loss.

A typical case is Sina Weibo. The number of users of Sina Weibo has dropped sharply since 2010. Sina Weibo has continuously launched new functions such as micro-games, small loudspeakers, Weibo secretaries, and topic hosts, which have exceeded the original simple and brief communication of Weibo. There were even more failures such as "sending private messages to people you follow", and the number of active users once dropped by more than 60%. Subsequently, the violent and direct recall method was still used without regard for the consequences. Unimportant information and notifications appeared in the information flow. Push notifications that did not meet personal preferences and recommended topics that were crudely pieced together made users miserable.

No wonder Chen Can, then editor-in-chief of technology media PingWest, once said that Sina Weibo was simply committed to harassing users. Therefore, harassing users is also a huge reason for significant user loss.

The popularity of topical products has waned: The topical product "Draw My Guess" was launched out of nowhere and once aroused the passion of players around the world. However, less than two months after it was acquired by Zynga in 2012, the number of daily active users dropped sharply from 14.6 million to 10 million, and even dropped to 2 million six months later. At its core, this product lacks an effectiveness engine that can continuously attract users, and it lacks the stamina to increase user stickiness. Once the novelty wears off, it is abandoned by players who are easily bored with the old and love the new.

There are better alternatives: For enterprises, the presence of better alternatives is undoubtedly the biggest threat. It not only means the loss of users of their own products, but also represents the recognition of competitors' products. A typical case is eBay and Taobao. When the once unstoppable e-commerce giant eBay was expanding into the Chinese market, it was unwilling to give up the policy of charging booth fees, which was not in line with the habits of Chinese users. As a result, it was shaken by Alibaba, which held high the banner of free services, and was finally completely defeated by Taobao's 40-meter sword.

Other factors: loss of demand, game completion, device loss, account loss, end of product life cycle, etc. may all cause user loss.

3. Metrics for measuring retention

Common indicators for measuring product retention rate include next-day retention, seven-day retention, and 30-day retention. The calculation formula is: the number of users who are still using the product on the Nth day after the first day / the number of new users on the first day.

Next-day retention : can be used to discover quality changes and channel advantages of new product versions in the first place.

Seven-day retention : can reflect the retention status after a complete experience cycle.

30-day retention : It can reflect the stability after a version iteration and help determine whether the product evolution direction is reasonable.

Channel retention : In addition, retention channels are also crucial. The quality of users in different channels varies greatly. While considering the retention rate, comparing retention channels can enable higher-quality advertising.

4. Reference for retention rate

For e-commerce websites , a retention rate between 20% and 30% is not too bad.

For social media , if the monthly retention rate of the first batch of users is less than 80%, it will be difficult to grow.

In the gaming category , whether a third-party game newly launched on the Facebook platform can obtain more than 1 million DAU (this is the minimum standard for measuring whether most new games can have a future), there is a so-called "40-20-10" rule circulating, that is, if you want the game's DAU to exceed 1 million, then the retention rate of new users should be greater than 40%, and the 7-day retention and 30-day retention should be greater than 20% and 10% respectively.

Among mobile applications, the retention rates of information reading, social communication and system tools are often the highest, and after 4 months the retention rate can stabilize at around 10%.

2. Methods to improve user retention

1. Optimize product performance

Facebook's case study on optimizing product performance

As the world's largest social network, Facebook's mobile client faces the most severe test in the world. It needs to cope with users in different geographical locations, network environments, device models and usage habits to ensure that the vast majority of people can use it normally. Especially in developing countries, due to the impact of infrastructure construction and economic and social factors, they are stretched compared with developed countries.

The Facebook team traveled to Africa in 2013 to personally experience the local product usage:

• The local network conditions are extremely poor and application connections are interrupted from time to time.
• Android devices have low memory, which causes apps to load slowly and often crash.
• The monthly mobile Internet data is limited and is usually used up in 40 minutes.

These situations are simply unimaginable in the United States, where WiFi is everywhere. To this end, the Facebook team made the following product optimizations:

• Single-core Android phones start applications extremely slowly because multiple modules need to be initialized in parallel during the startup process. So they moved these initialization processes to after the startup of single-core mobile phones, and even initialized some modules only when they were about to be used. This change reduced the app's startup time by 50%.
• Preload data that may be needed in the future when the network is smooth, so that users can get as much offline content as possible when the network suddenly becomes bad.
• In order to deal with the problem of expensive network traffic, they researched many image formats and finally chose the WebP format, which was also launched by Google, the developer of the Android system. The two are ecologically compatible and have high compression efficiency. It saves 25% to 35% of traffic compared to JPG and 80% compared to PNG, and there is no obvious change in image quality.
• Loading thumbnails: At the beginning, Facebook will load the image with the maximum resolution. This is to allow users to see clearly and zoom freely. Later improvements were made to prioritize loading images that are suitable for the current phone resolution, and only obtain the highest resolution images from the server when needed. This change reduced the number of slow or failed image loads by 90%. In fact, it is very common. Our QQ, WeChat, etc. all have such mechanisms.
• The limited space on users’ mobile phones directly leads to the difficulty in downloading installation packages during upgrades. These users will continue to use the old version and will not be able to enjoy the new features of the upgrade. So we developed a tool that can automatically calculate how much each product feature will increase the size of the installation package, so as to make functional choices on different Android devices and push different installation packages. After optimization, the file size was reduced by 65%.

The Facebook case tells us that optimizing products can actually improve user experience and increase retention to a greater extent. Similarly, we develop products carefully at the pixel level, and would rather trouble ourselves than burden users. With such awareness and sincerity, we work hard to make products, and I believe that users will be able to feel it.

2. Damage to service

(1) What is lossy service?

As the name suggests, lossy services refer to services that can output some loss in quality, with the purpose of sacrificing this in exchange for optimization in other aspects (speed, stability, successful execution). This seems to go against the pursuit of perfection by product managers, but it is not. The following case allows us to fully understand the balance brought about by lossy services.

(2) Tencent QQ Farm

Existing problems: When QQ Farm was first launched, it was a national-level application, but its unprecedented popularity always brought tremendous pressure to the server, causing many users to encounter problems such as slow icon loading, incomplete list entry, or even inability to enter QQ Farm.

Solution: Under normal circumstances, users can still see a complete list of more than ten to twenty different applications in QQ Space; during peak network conditions, only logs, QQ Farm in game applications, etc. are displayed. Although it does not allow users to open any application at any time, it perfectly solves the embarrassment of "everything or nothing" for users during peak hours.

(3) Xiaomi mobile phone ordering page

Description of the event: Xiaomi mobile phones are always sold out in an instant when they are snapped up online. The instantaneous high-intensity pressure will drag down the server even if the backend operation and maintenance are well prepared.

After reviewing the issue, it was found that Xiaomi's official website adopted a lossless design. Each buyer can see the exact number of phones left, which increases the real-time query volume of background data.

Solution: When there are still a lot of mobile phones left in stock, users don’t actually care about the actual number. It can be displayed as only 50,000 units left. Assuming there are only 100 units left, buyers will care about the real number. At this time, the precise number can be displayed. If you think about it carefully, you may find that products like 12306 have also used this method to relieve server pressure a long time ago.

(4) Principles of Damaging Services

• When problems occur, we are committed to ensuring the normal operation of core functions, and non-core functions cannot affect core functions.
• When conditions permit, the fewer features and functions that are sacrificed, the better.

SO, being a perfectionist is not that easy. Instead of being a perfectionist, it is better to focus on the big things and let go of the small things and give up unnecessary persistence.

Quote: Glory is taken from the sword, balance is sought in chaos~

3. Guide users to get started quickly

Product managers often fall into a misunderstanding, which is to judge others by their own understanding of the product and apply it to the perception of ordinary users. Unfortunately, most users are smart egoists. You must present your best side at the first time, let them get started quickly and have something to do, otherwise their attention will soon be attracted by other simpler and more interesting things.

(1) Twitter example

In the early days of Twitter's launch, it attracted a group of bloggers and internet celebrities who loved to try new things, and the number of users increased dramatically. However, as Twitter developed, user retention gradually declined. Because not everyone has a strong desire to perform, many people would rather be a listener.

After analyzing the users, we found that if a newly registered user follows 5 to 10 people at the beginning, the possibility of him leaving the app halfway will be greatly reduced. It is like an investment or commitment, which prevents the user's timeline from becoming empty and makes people want to continue using the app.

Therefore, Twitter added a function for users to follow other users with one click in the last step of new user registration. This practice has greatly reduced the user churn rate. This approach has also been introduced into many social products.

Think about it carefully, when you register on some forum websites, the last step is to follow the content you are interested in with one click. This is worth pondering. Twitter's operating strategy from several years ago can continue to this day, and this is a method that can stand the test of time.

4. Social Retention and Social Unbundling

Socializing is one of people's basic needs. According to statistics, it is difficult for ordinary people to persist for 2 hours in a sealed, deserted and silent environment.

The next two cases are examples of strongly associated social relationships and completely untied social relationships. There is no superiority or inferiority between the two, only suitability. Facts have proved that there is actually a huge market for both stranger social networking and acquaintance social networking.

(1) Social maintenance: the combined tactics of the national aircraft war

At the end of 2103, the Aircraft Wars game, which was once popular on the entire Internet, was launched on WeChat and mobile QQ game platforms. This game relies on gesture operation, and the smooth feel and refreshing upgrades make players unable to stop playing. The "combination" function is talked about by players.

What is "fusion"?

Before the official game starts, users can enter the friend selection page and select one friend from their WeChat or QQ friends to enter the "fusion". Choosing powerful and high-level friends can get more support from friends' fighters in the game, which can greatly increase their firepower. As a player who has been merged, you can make money without doing anything. In this case, old players are likely to be recalled because of the merger and become players of the National Air War.

This method of importing friends, importing address book friends, linking QQ friends, and linking WeChat friends is used infinitely in today's Internet era. The strong social binding relationship allows more interactions between acquaintances and brings more activity.

(2) Social unbundling - Same's social unbundling strategy

The mobile social application was launched in the summer of 2012, allowing users to record their daily lives in the form of pictures, texts and music, which is now called vlog in a more popular way.

Same's unorthodoxy is astonishing. There is no function to view nearby people, no gender filtering, no function to import contacts or social accounts, and you can't even follow people you are interested in. In response to this, the operator in charge of Same said generously, "People who meet will always meet again." This literary and artistic operation made the author feel ashamed.

Can such a rebellious product have good retention? However, according to early data statistics, Same’s next-day retention rate has remained above 50%, and the retention rate after 5 days can reach 30%.

In fact, a careful analysis shows that the one-way attention or two-way connection mechanism of traditional social products has established an orderly flow of information and improved communication efficiency, but it has also intensified hierarchical divisions and social pressure. For example, on Weibo, a piece of meaningless news from a few celebrities can often trigger a nationwide carnival, while a carefully crafted poem can only be silent amid the noise.

Same gave up the idea of ​​competing with the loudspeaker-style self-media from the beginning, and focused on those groups who have little influence but are unwilling to be lonely. After unbinding social relationships, every user becomes an individual on the same level as others. They no longer have to worry about exposing their words and actions in a fixed place and in front of acquaintances, allowing their hidden desire to express themselves to be released. Same can be considered as lonely social interaction, but there are many lonely people, but loneliness does not mean solitude.

Similarly, Soul, a product that unifies social relationships, has been loved by a large number of users. This dark horse in stranger social networking has gained support from users shortly after its launch. Sometimes people can only express themselves freely and sincerely by leaving their old circles and cutting off unnecessary connections.

5. Good wake-up mechanism

(1) What is the wake-up mechanism?

The wake-up mechanism refers to a product mechanism in Internet products that is specifically designed to recall lost users. Commonly used wake-up mechanisms include: SMS wake-up, message push notification, email wake-up, and mobile web page wake-up application.

Wake-up mechanism 1: Push notification to call back users

According to the analysis report: If users turn on the notification permission of the APP, 62% of users will use it again after a few months; if users turn off the notification permission of the APP, the above proportion will drop to 32%.

After a survey of 2,400 apps and 500 million push notification samples by mobile research company Urban Airship, the daily activation rate of apps using push notifications can be increased by 540%. The average usage time of users who enter the app through push notifications is 26% longer than that of users who enter through ordinary methods, and the 6-month retention rate is also higher.

However, it should be noted that inappropriate and overly frequent push notifications can also cause user annoyance. According to statistics, 23% of users have uninstalled apps due to system push notifications. The older the user, the lower their tolerance for app push notifications. In comparison, men are more likely to resist push notifications than women.

So how should we push it? How to screen the right audience for push notifications, how to formulate push notification content based on usage scenarios and time periods, and how to create and optimize the landing page for push notifications? How to push high-quality content that suits the interests and needs of the target group based on their usage scenarios has become a basic skill for those responsible for user growth.

Here are some notes on push:

1) Push authorization

Different platforms have different authorization methods and permissions for push notifications. On iOS, users have the right to refuse push notifications from an app when they first launch it. On Android, push notifications are turned on by default. If users want to turn them off, they need to go to the system settings. Therefore, the push arrival rate of Android is generally above 95%, while that of IOS is generally less than 50%.

In order to increase users' willingness to retain push notification permissions, it is recommended to initiate authorization when necessary, especially using a simple floating window to remind users the purpose of enabling it. Similarly, it is now a very mainstream practice to use a nice and attractive permission authorization page to directly authorize all permissions at once when opening an application.

2) Badge Notification

The small red number in the upper right corner of the APP is the badge notification, which can maintain the presence of the application itself to a large extent. I believe that many users are unwilling to see so many small circles and can’t help but click on them. I have never seen a person with obsessive-compulsive disorder die from the addition of a badge notification with 1 unread messages on their WeChat profile picture.

3) Local Notification

Local notifications are not based on interaction with the server. They look similar to normal notifications, but are sent locally at a preset time and do not require an Internet connection. For example, in the mobile game Dota Legend, the user will be prompted to collect energy at breakfast, lunch and dinner time every day, telling the user, "It's time for a delicious meal again, why not come and play a game at the same time."

4) Geofence Notification

When the app detects that the user has entered a specific area, a geofence notification is initiated. Typical usage methods include automatic shopping guide applications in shopping malls, nearby catering service discovery applications, etc. Due to differences in mobile phone networking methods and performance, errors may occur in obtaining the user's location, affecting the actual effect of geo-fence notifications.

5) Image push notification

Simple text notifications usually need to catch the user's attention within 100 English characters or 20 Chinese characters. A more engaging way is to use images for push notifications. Android provides such a feature, allowing developers to customize notification bar icons, expanded images, media backgrounds, etc.

6) Emoticons

For platforms like iOS that do not support adding images to push notifications, a workaround is to add Emoji text in the notification instead.

Wake-up mechanism 2: Wake up the mobile app from the web page

Web page wake-up application means that the installed APP can be woken up in the mobile web page. For example, when you are browsing Zhihu questions in the browser, a pop-up window suddenly pops up in the browser. Click to wake up the APP to view more. Click at this time to enter the APP directly and enter the question the user is looking at.

There are many ways to implement this, but they are more technical. The author is a technical novice, so I will not elaborate on it here. I hope my colleagues in development can provide more support to everyone.

Wake-up mechanism 3: SMS wake-up/email wake-up

With the development of mobile applications, SMS wake-up has gradually occupied the majority. Here we will briefly explain some mechanisms of SMS wake-up and email wake-up.

（1）Provide rewards

Give users certain material or spiritual rewards, such as discounts, VIP privileges, free shipping, etc., or let users experience paid functions for free. This is the case with Ele.me’s Quality Alliance Red Packets.

(2) Report progress

Inform users of product updates, business blueprints, or major team adjustments, and attract users to experience new interfaces and new features. The text message can include a link, and the user can wake up the APP after clicking on it in the browser.

(3) Personalized recommendations

Build user profiles based on the collected user behavior data, and push precise personalized services based on the user profiles, rather than broad, indiscriminate information.

(4) User social interaction prompts

Relying on interpersonal relationships as a bond, users are notified of the latest activities on social networks, such as friend requests, private messages received, likes received, recognition received, etc.

Author: Wang Deyu AIPM

Source: They are already on the way (ID: PM-Silence)