7 ways to help you correctly understand and improve user retention

After discussing the two major issues of attracting new users and active users, there is another important issue that needs to be solved: retention . Many people think that users are retained as long as they open the app at a certain frequency, and then set the key indicators at DAU (daily active users) and MAU (monthly active users). In fact, this kind of data evaluation will have a large deviation.

What is retention?

Retention means that the user takes the action you expect him to take until the action becomes a habit and he continues to stay in that stage.

• For e-commerce products, retention means that users continue to make repeated purchases;
• For community products, retention means that users continue to contribute content repeatedly;
• For mutual financial products, retention means that the funds invested by users remain in the account and will not flow to other platforms;
• For content products, retention means that users continue to read repeatedly.

So don’t simply assume that user activation counts as retention, as this will affect your ability to make an objective and accurate assessment of your current survival status.

Why retain?

Retention is a critical part of the growth hacker funnel model. The benefits of retention are:

1. If the retention rate is low , then everything else you do to attract new users and increase activity is basically meaningless. Your users just left at the last link of the funnel, which is a waste of time and effort.
2. Those users who have been educated and screened by you are often the most interested in your products and are most likely to become loyal users. You have invested a lot in finding and cultivating this group of high-quality opinion leaders, and retaining them can help you create greater value.
3. Since attracting new users, activation and retention are often carried out at the same time, in order to maintain the stability of DAU and MAU, retention is often easier to achieve than attracting new users. We assume that in the absence of any new users, 30% of users will be lost every month. At this time, retaining 30% of users and adding 30% of new users can both achieve stable MAU. However, retaining 30% of users obviously requires much less time, energy and resources.
4. Retention can increase the user's lifetime value (LTV), which will help us tap into more potential of users and even affect the entire funnel model.
5. Users with a long retention time are more willing to promote your products, allowing you to acquire new traffic at a low cost due to word-of-mouth effect.

7 strategies to improve retention

1 Traffic batch test

Many growth hacker models seem to convey the message that you must first acquire traffic, then make it active and monetize it, and finally retain it, achieving your growth goals and business value step by step.

In fact, this is not the best way to apply the funnel model. Attracting new users, active users, and retention also need to be experimented with through MVP (minimum viable product) . When you get the first batch of traffic, test the active user and retention strategies through this batch of traffic to see how effective it is, repair and optimize the funnel itself, and then invest more resources to try the second batch of traffic, and then continue to iterate the funnel.

So retention is not something to be considered at the last step. By testing traffic in batches, you will get a stronger and more complete funnel model (including retention) early on, which will improve your capital/resource utilization efficiency in subsequent work.

2. Reach the aha moment as quickly as possible

Aha moment is now mostly translated as enlightenment moment . This term was first coined by German psychologist and phenomenologist Karl Bühler about 100 years ago. He defined the expression at the time as " a special, pleasurable experience in the thinking process, during which a deep understanding of a situation that was previously unclear suddenly arises ." Today, we use the term aha moment to describe that moment when the solution to a problem suddenly becomes clear.

For product design, the aha moment is when the user’s needs and pain points are met through a certain behavior or operation path, and the user fully realizes the benefits of the product . One of the keys to improving retention is to allow users to reach this aha moment as quickly as possible .

Before users start using your product, they have actually formed a certain psychological expectation through your various methods of attracting new users. They hope that this expectation will be met in the product as soon as possible, rather than wasting time on the product. For example, users' expectation for cycling products is to find a usable bike as soon as possible, their expectation for loan products is to borrow money as soon as possible, and their expectation for photo editing products is to complete image processing as quickly as possible. Therefore, this principle must be followed in the design of the product's main processes and core functions to meet users' core demands as quickly as possible.

Before designing, you need to clarify a few issues:

• What was your product’s aha moment? What actions can users take in the product to improve retention?
• If it currently takes a new user two days to reach the aha moment from using the product, can it be shortened to two hours?
• If you need users to register to experience the value of your product, can you change the way they do it so that they can experience the aha moment before they sign up?
• Are the features/services you are recommending in your product now able to help users reach the aha moment, or are they disrupting the main business process and reducing the probability of users reaching the aha moment?
• Do you really explain your aha moment clearly in the recall emails and SMS messages you send to new or lapsed users? Do you clearly tell users what they need to do to achieve their aha moment?

Here is a simple example, comparing the two apps Jianshu and Renrenshishipinmiaoguan :

For these two content apps, the user's aha moment is obviously when they read content that is valuable to them . When designing the product, we should focus on allowing users to complete content search and content screening as quickly as possible and quickly enter the reading stage.

Jianshu chooses to display the topics and authors that users are interested in on the homepage, and highlights the topic name/author name rather than the article itself . The only entry point for quick access to reading is the search box. Considering the product iteration history and current development strategy of Jianshu APP, it is possible that this is to bring more traffic to authors and help the platform create big Vs. However, given that this strategy has not yet formed a stable model, the user's mental model when entering Jianshu is still reading rather than following big Vs. At the current stage, adopting this design may reduce the utilization rate of homepage traffic.

The homepage of Everyone is a Product Manager focuses more on meeting reading needs . It meets users' different needs for filtering content through classification modules, search modules, and recommendation positions, thereby quickly starting reading. To recommend authors and stimulate users to contribute content, recommendations are made through the author module of the discovery tab. More often, the goals of maintaining user relationships and stimulating content output are achieved through communities and activities outside the app.

3. Make good use of recall notices

One of the common methods to improve retention is to send recall notifications to lost users. This notification can be sent through APP push, mobile phone text messages or emails. However, a good recall strategy can certainly improve retention, but a bad strategy will cause excessive interference to users and cause more user loss.

Regarding recall notices, the following four points should be noted:

①Purpose of recall

The purpose is of course to improve retention, but this improvement in retention must be specific to a key behavior: what behavior do you want users to complete when they return to the product? Generally speaking, user churn may occur at every stage of the funnel, and the goal of recall should be to get users to return to the product and complete the conversion at that stage of the funnel .

②Recall scenario

Using scenarios for recall can reduce users' resistance to interruptions. Common scenarios include:

• Event notifications based on user behavior : For example, a user's social behavior within the product has gained new interactions, the price of an item in the user's shopping cart has changed, or the topic the user is following has updated content, etc.
• General notifications : such as site-wide promotions, new activities, etc.
• Alerts : For example, alerts can be sent when there are abnormal behaviors regarding the user's account security or property security, or when the products, activities, and discounts that the user is interested in are about to expire.
• Functional update : When new functions are launched or important versions are updated, it is also a common scenario to activate and recall users.

③ Recall objects

In fact, this issue is involved in both the purpose and scenario of recall: do not simply and roughly recall all users. Only by splitting the recall objects finely enough can the success rate of recall be increased.

Before conducting a recall operation, determine the screening criteria for the recall objects: for example, are the loss points of this group of users in the main process consistent? Is the reason for not completing the conversion consistent with your prediction? Can the tools /bait used in the recall solve the problem? Is the time period of loss of this group of users who did not activate the APP consistent? If you cannot maintain relative consistency on these issues, consider splitting the recall targets into multiple groups and developing recall strategies for each group.

④Recall system

We cannot expect to have an effect by recalling users just once. Recall is not an action node, but a continuous linear strategy system that occupies the user's mind through drip marketing and retains the user.

Drip marketing is a commonly used method in marketing, which refers to a marketing campaign that repeatedly contacts or reaches potential customers. When implemented correctly, drip marketing can help you convert more leads. An important function of drip marketing is to continuously strengthen the image of the product in the minds of users, allowing the product and brand to gradually occupy the minds of users.

For example, a new user may receive a recall SMS on the 3rd, 7th, 14th, and 21st day after registration. At each action node, the bait provided to the user to enter the APP and convert may be different, until they return to the funnel process and complete the conversion. It should be noted that after the conversion is completed, the recall work in this link needs to be stopped, and his behavior in the next conversion link needs to be observed to determine whether he meets the screening criteria for the recall object in the next link.

4. Set up a churn feedback loop

Do not give up any opportunity to win back users. If you face users who are certain to leave, you need to add a step to allow users to provide feedback on the reasons for their loss. The role of this link is: on the one hand, it allows you to understand the reasons why users leave you, so as to facilitate future improvements; on the other hand, through these reasons you can understand which user demands are not met and retain these users again. For example, you can offer exclusive products, exclusive coupons, free service duration, etc.

5. Enhance product value

The core of any product is the value it provides. In the first stage of using a product, users discover the value of the product and reach the aha moment. However, this does not mean that users can maintain the satisfaction brought by the aha moment for a long time afterwards. The purpose of enhancing product value is to bring a new growth period to the product through changes based on the existing product life cycle .

The so-called changes may refer to the following factors:

1. The trend of the industry environment: The level of industry development is changing, and users' cognitive stages and behavioral habits are changing. These factors directly affect whether the value currently provided by the product is still valid. A good product should take action when it finds changes in trends and spontaneously promote change, rather than waiting until it is in a passive position and being controlled by others.
2. Extension and improvement of user needs: The user’s current needs may have been partially met, but are they fully met? If the reasons for churn reported by users are very concentrated in the churn feedback link, it means that the services that users want cannot be met by the current product. In this case, you should carefully consider whether the services provided by the product and the design of the main processes need to be further optimized.
3. Competitive product dynamics: If your competitors can provide products with greater value and better quality, users will obviously have more reasons to leave you. Based on your own product positioning and user positioning, consider how to enhance your own product value to prevent the loss of this part of users.

For example:

Skyscanner's business started with air ticket inquiry and price comparison, and later expanded to hotel, car rental and other businesses. In 2016, it comprehensively upgraded its own business, not only providing users with pre-trip preparation services, but also providing users with travel inspiration, and adding new modules such as travel headlines, interview/visa on arrival country recommendations, and recent special air ticket recommendations. These changes are directly related to factors such as the increase in demand for outbound travel in recent years and changes in the way users make travel decisions.

6. Build user relationships

A very effective retention strategy is to create a connection between users and products, let users find a sense of belonging and existence, and let users become a part of the product.

The most basic way to build user relationships is to operate content or communities. After all, users must first increase the frequency of opening, provide topics, and cultivate participation habits before it is possible to establish connections. The second stage is to build communities to strengthen user relationships, increase the frequency of contact, and speed up contact. Through activities, exclusive discounts and other means, users can feel their presence and sense of belonging. The third stage is to pay attention to and implement the opinions and demands of users, so that users feel valued and recognized, and reflect this in product design and event planning . Users have changed from unilateral recipients to partners in production and sales.

Take Taobao as an example. Taobao Circles was launched in 2015 and has evolved into the current Weitao and Wenda. Combined with Taobao Community, Taobao Experts, Taobao Trial, Taobao Live and other businesses, it has formed a very strong e-commerce community ecosystem.

7. Develop a Delightful Retention Strategy

For all the strategies mentioned above, this point should be met: no matter what retention method you choose or what retention strategy you develop, it should make people feel happy, pleasant, and relaxed, rather than disturbing, disgusting, and stressful. No one wants to spend their time with a disappointing product.

Mobile application product promotion service: APP promotion service Qinggua Media advertising

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