How to improve product stickiness and reduce user churn rate?

The Internet has entered the second half today. Users have many choices in every field. We who work in the Internet industry must feel like we are fighting a battle every day. We try our best to attract more users and keep them longer.

Some people take a long-term approach and improve by building a complete system; some people may take a short-sighted approach and stimulate user participation by using some techniques that tap into the bottom of human nature in exchange for a temporary increase in data. There are many ways and methods, and they are all very correct.

But have we ever thought about this question, what factors are affecting the loss of users all the time?

Compared with the churn rate, Dalun actually cares more about the inability to recall users, because churn is inevitable. Users will inevitably churn for a short period of time after their needs are met . As long as I can easily recall them again through some means next time, good operations are to continuously shorten the cycle between churn and recall.

Therefore, if it is very difficult to recall users and the churn rate cannot be maintained, this product will be in danger.

So how do we improve product stickiness ? Today I’d like to introduce a concept – “escape cost”.

Of course, there are many ways to improve product stickiness and retention . This article only analyzes from the perspective of "escape cost".

What are escape costs?

As the name suggests, escape cost is the cost of leaving. Do you remember the "Escape from Beijing, Shanghai and Guangzhou" event that was very popular last year? The first few people who went to the airport would receive free air tickets for travel. Some people did participate and left without any delay.

But it is definitely not for us poor Internet workers, because the cost of leaving is too high, and the work progress will be delayed, which we cannot bear the responsibility (my former boss gave such an order → a fine of 10,000 10,000 10,000 for going online one day late), on the other hand, there will be a certain loss of salary, etc. Anyway, I hesitated for a while and went to the company honestly, emmm…

In the past, the mobile phones we used were all feature phones. Think about Nokia . Back then, when we changed phones, we only had to remove the battery and replace the SIM card. All the calls and text messages were on the card. But what about changing phones now?

The cost is too high. You have to reinstall all the apps. If you switch from Apple to Android, all the money you spent on game recharges will be wasted. You can imagine the cost of this migration.

You see, this is the cost of escape.

From a product perspective, escape cost is the cost that occurs when users leave your product to use other competing products or give up their needs.

Let's understand this sentence more clearly. The cost of leaving the product can be translated as:

1. Can his needs still be met after he stops using your product? Will other products meet them better or worse?
2. How much money, time, and interpersonal relationship costs have been spent on your product in the past? Can they be easily discarded?

The cost of switching to other competing products can be translated as:

1. Be able to meet needs faster and more comfortably.
2. Able to obtain more personal benefits.

Of course, there is another situation in which users flee: this demand is not met well by products on the market, I don’t need any product, and I temporarily give up my demand.

Through the above factors, we can derive a simple formula for product stickiness:

Product stickiness = escape cost – (cost of using competing products + cost of giving up satisfying demand)

The cost of using competing products depends on how strong the opponent is, which we cannot control. Whether users have to temporarily give up meeting their needs, there are too many scenarios and it is difficult for us to influence all users.

The only thing we can fully control is the escape cost of our own products. If we make its base large enough, far exceeding the other two items, we can change the stickiness of the product. Next, let’s take a look at how to increase the escape cost of users using our own products.

How to increase product escape costs?

Dalun is a simple and rough person. Looking down, we divide the escape cost into three ways:

1. Deep Engagement

The current situation of the Internet has become a winner-takes-all situation. It is difficult for new projects to obtain high profits by establishing traffic barriers. In such an environment, do new projects have no chance at all?

Obviously not.

After several years of development, a number of small but precise early projects have emerged, including VIPKID, Dedao, Yiersan, etc. The common feature of these projects is that they do not expand blindly and will no longer use the strategies of the traffic era to develop.

Instead, it accurately targets a target group and continuously refines services, providing users with more exclusive, rich, and personalized services, allowing users to establish a sense of identity with the brand through long-term and continuous financial investment. At the same time, the product also outputs some actual value to users.

Similarly, large projects that have established traffic barriers in the early stages have also realized similar problems. This is the case for Ele.me memberships, Tmall memberships, Convenience Bee memberships, and JD Plus.

To sum up: the deep participation method is to allow users to obtain more in-depth and personalized services of the product through actual payment, thereby enhancing the long-term value of users in the product to gain loyalty and cost sedimentation, making it difficult for users to leave, resulting in high escape costs.

On this basis, operations staff can increase the design of membership system levels and incentives for various activities to continuously enhance user stickiness.

However, not all projects are suitable for enhancing stickiness through deep participation. This method is suitable for high-frequency projects that solve user itch points rather than pain points. What does it mean to solve itch points? Don’t products all solve pain points?

Let me give you an example: eating is a pain point for me, so the existence of restaurants is to solve this pain point, and the emergence of takeout O2O is to solve the itch point. Even if there is no takeout, we can go downstairs to eat, so the itch point can basically be understood in one word: "cool".

What about other projects? How to improve product stickiness for projects with low frequency?

Let’s continue reading.

2. Relationship Sedimentation Method

The relationship here refers to two aspects:

1. The relationship between users in the product;
2. Emotional cognition of products and users.

First, let’s look at how to establish emotional cognition between products and users?

The growth department of Linkedin, a well-known workplace social platform, once conducted an interesting experiment. They found a magic number for Linkedin: as long as new users can add 5 contacts after entering the product, their retention rate and usage frequency will increase by 3 to 5 times.

Twitter's growth department also discovered a similar principle through data: if new users follow 30 friends within 30 days, the activity of these users will increase significantly.

Let’s take a look at the first login to Weibo:

First, choose the content you are interested in, then recommend user relationships, and finally let you set up your own information. Step by step, your behavior is being integrated into the product, just like in the case of LinkedIn and Twitter, we are building a whole new emotional connection with a product.

But please note: when designing such a mechanism for a product, be sure not to be too rigid or have too many links, otherwise it will easily cause users to have bad emotional cognition about the product. In psychology, there is a professional term "over-limit effect". Those who are interested can go to Baidu to search it.

So how do the above practices help product stickiness?

Imagine that you designed your own information, avatar, mood, and personal signature on a platform, took a photo and then photoshopped it, thought for a long time to write a signature, and then there were a lot of interesting contents, or you were spying on people you were interested in. What do you think? Still want to escape? If a similar product pops up at this time, would you use it? The chances are already very small.

This method is applicable to most products. For example, in e-commerce projects, can we create an emotional connection with the product by establishing a scenario association between users and products? This is why many e-commerce companies need to do scenario-based development, by asking users about their expected scenarios and needs to recommend suitable products.

Let’s look at how users establish emotional connections with each other. This is easy to understand. WeChat and Zhihu are typical examples of building relationships between users.

Speaking of WeChat, I remember that two years ago, an entrepreneur said that he wanted to become the terminator of WeChat and even received a large sum of investment . Maybe this investor wanted to become famous. My personal opinion is that it is a fantasy. WeChat, based on the strong relationships among acquaintances, has evolved from a social software into something comparable to making phone calls using a mobile phone.

The cost of getting a user to leave WeChat is too high. No one will abandon all their friends, relatives and various potential interest relationships, so the cost of leaving WeChat is unimaginable. There is basically no loss of users for this product, only some users who have not been harvested yet.

To sum up: the essence of the relationship sedimentation method is to allow users to participate in the product through artificially designed mechanisms, and then establish emotional connections between users and products and relationship connections between users and other users, thereby increasing the escape cost.

3. Interest-based kidnapping

"Kidnapping for profit" sounds like a derogatory term and its meaning is rather complicated, so we won't delve into it in depth. Because in this article we only take its literal meaning, which is to use interests to kidnap users. Perfect~~~

Two representative products of this approach are OFO and Qutoutiao .

Let’s look at OFO first:

The first time I clicked on the deposit refund, I was reminded of the current value of my account and how much deposit I had. How many discounts are there? Of course, this was also obtained from various previous promotional activities. When I saw this, I basically decided not to refund it because I had a lot of money in my account.

Another type of user may have no money in the account and no discount. Just continue to click on the refund button and OFO will give you 5 yuan to recharge directly into your account. Are you still leaving? how? Is the cost of escape high enough?

Let’s look at the interesting headlines:

The growth of Qutoutiao is one of the fastest in recent projects. It has seized the opportunity of channel sinking and quickly spread through the middle-aged mothers and fathers and young people in small towns, by making money by recruiting disciples and making money by reading articles and completing tasks. Of course, this is a very good way to attract new customers . Dalun believes that this method is basically applicable to any product to collect data at present.

When users have accumulated medium- and long-term benefits in the product, it forms what we literally mean by "interest kidnapping".

To sum up: "Benefit kidnapping" = making users accumulate direct benefits in the product to force users to stay on the platform, thereby increasing the cost of users' escape.

Basically all projects are applicable to this method. The key is to find the margin related to the core interests of the project and design this "kidnapping system".

Final Thoughts

We want growth, retention, and product stickiness, but we also have to consider the methods we use. We cannot disturb users excessively, nor can we create features that do not provide value to users.

Here I would like to quote Wang Mingyang:

“Heavenly principles are human desires”

The author of this article @静静 is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting!

Product promotion services: APP promotion services, advertising platform, Longyou Games