How to build a user “retention” system?

In order to attract more users, many companies are willing to "burn money" to provide subsidies and use the method of giving away money to attract users. New users are there, but without retention operations, we will fall into a vicious circle of attracting and losing traffic. How to build a user “retention” system? The author of this article has conducted a three-dimensional analysis on this issue, and I hope it will be helpful to you.

1. The focus of operations shifted from "traffic" to "retention"

As the traffic dividend disappears and the growth rate of new users slows down, companies are in a fierce competition for existing data. This has also caused the cost of precisely positioned Internet traffic to rise sharply, the cost of acquiring customers remains high, and it is difficult to quantify ROI.

Money-burning and self-subsidizing methods such as "10 billion subsidies" and "network-wide advertising" are used to attract new users, but the operational aspects of user retention are ignored, which will only lead to a vicious circle of attracting and losing traffic.

Different from the one-off "traffic thinking", "retention thinking" is repetitive. It uses existing traffic as a guiding clue, recycles it, relies on the fission growth of old traffic, realizes the relationship transformation with new traffic, and repeatedly creates value. This is the important significance of retention operation thinking.

2. Three main characteristics of “retention volume”

1. Controllability

Traffic is "flowing passers-by" and retention is "continuous income".

Through in-depth user maintenance, continuous and effective interaction between enterprises and users can be established, which will replace the loose relationship between different users lingering on different platforms and form a closely connected alliance system. This part of user traffic can also become the company's retained assets, and the conversion is highly controllable.

Detailed user operation and maintenance services are needed to improve users' brand loyalty and trust. At this time, any form of marketing promotion will be more likely to mobilize the willingness of retained users to participate.

2. Low cost

In the traffic operation thinking, in the process of accurate traffic operation for effective users, the strategy execution process usually needs to go through:

Channel acquisition activities to acquire users → Activity operations to increase user activity → Sticky activities to increase retention rate → Conversion operations to obtain revenue → Viral marketing for self-propagation.

In any of the above-mentioned marketing nodes, there will inevitably be natural loss of users, which often results in a low marketing conversion rate. It is necessary to rely on large and continuous capital investment and marketing campaigns to increase transaction volume. Ordinary small companies can hardly afford such high costs for purchasing precise traffic.

Therefore, limited costs should be invested in the retention operation and maintenance of existing customers who have already converted. The cultivation of retention should be completed first and then the conversion should be carried out. When the target customer group is accurate and the scale is complete and visible, a high-quality user gathering community should be built, and users should be reached and activated with high frequency. The overall customer acquisition cost will be greatly reduced compared to traffic marketing, and ROI will also increase accordingly.

3. Reusability

The reusability of "traffic" is mainly reflected in: replicating traffic and activating traffic.

Duplicating traffic: Companies introduce external users into their own traffic pools through drainage, and through refined user operation and maintenance and product function stimulation, they deepen the stickiness of traffic while activating users. Then, they trigger activities through high-frequency marketing strategies to guide active users in the retention group to spontaneously attract new users to join, forming a new level of retention and achieving exponential growth in retention replication.

For example, the team task in the Alipay voucher collection activity guides active users to use the product's "sharing" function by forming a group to share the vouchers, forming a "retention" group, and requiring all team members to complete in-store consumption every day before they can collect the vouchers. This process not only increases the stickiness of retention, but also increases the user's Alipay usage rate, which in turn generates more consumption behavior.

Activate traffic: Activate traffic means to stimulate the participation and payment willingness of silent users or potential active users who have not consumed by improving product services and operational strategies, and promote them to complete transactions.

3. Building a user "retention" thinking model

Compared to the AARRR model marketing strategy that focuses on acquiring new users in order to achieve user growth, retention marketing focuses more on the RARRA model that prioritizes retaining users.

Yingyu MA is an automated marketing platform that uses the AARRR model with one-stop management to target marketing goals.

Image source: Yingyu MA

By attracting user retention through traffic, and then activating and optimizing users through appropriate marketing strategies, and completing key conversion behaviors, behavioral incentives are then used to drive retained users to generate recommendation and dissemination behaviors, thereby achieving healthy growth of users with incremental stock in the retention pool. High-quality retained users can generate continuous paid contribution behaviors.

1. Cultivation experience of high-quality products

The core of user retention is whether the PMF (product-market fit) is high enough? What value does the product provide to users? Is the product irreplaceable? It is not difficult to see that the starting point of user retention revolves around "product". High-quality products can achieve PMF values ​​and provide a better user experience, thereby realizing long-term contribution value to users.

There are two reference dimensions for a product to retain users:

• The product basically meets the user's usage needs and can produce sustainable value for them (mostly seen on the C-end);
• There are few alternative product options/the cost for users to switch to new products is high due to training cycles, etc. (more common on the B-side).

After precipitating the value of the product, the next step is to let users perceive the value of the product and develop a habit of using it:

• Increase the frequency of use of the core functions of the product;
• Increase the time users spend using the product;
• Expand the user usage scenarios of the product.

Understand the core functional demands of the target user group and optimize them to meet user needs, cultivate users' product awareness and catalyst habits, and allow users to use the core functions of the product frequently.

The length of time users use a product is directly proportional to the degree of user retention. Therefore, in order to increase users' familiarity and awareness of the product, the entry point can be non-core functions such as development games and community communication.

Broadening the user usage scenarios of the product is to more easily trigger consumption scenarios that resonate with users' deep emotions. Multi-scenario access can better stimulate users' purchasing behavior. The scenarios have also evolved from single online or offline scenarios to full scenarios across industries, fields, and channels.

Scenario-based Reaching With powerful customer data insight and analysis capabilities, we conduct targeted research on target users' online and offline media triggering habits, behavioral dynamics, product preferences and other behavioral attributes, thereby launching more proactive, more effective and more targeted marketing.

• Trigger marketing campaigns based on real-time user behavior;
• Supports large images, small images, and no images, covering a variety of triggering forms;
• Through data collection, we can grasp user portraits and business dynamics in real time;
• Implement personalized operation strategies.

2. Hook Addiction Model

The Hook addiction model was proposed by Nir Eyal and Ryan Hoover, authors of the book "Addicted: Four Product Logics that Make Users Develop Usage Habits". It mainly focuses on how to make users "addicted" to the product and cultivate users' usage habits. It includes four elements: trigger, action, reward, and investment.

1) Trigger: guide users to take action

Guiding users to take triggering behaviors is divided into internal triggers and external triggers. Internal triggers are mainly to guide users' emotional resonance, behavioral habits, and usage scenarios, while external triggers are mainly pushed through channels such as SMS and emails.

The diversified development of media has also made users' touchpoints more diverse, including PC/Mobile Web, APP, WeChat public accounts, mini-programs, corporate third-party platforms, etc.

In the process of reaching customers through diversified channels, we should focus on personalized content experience and achieve precise "one-to-one" marketing.

Yingyu MA's automated marketing management strategy is based on the strategic logic of "if...then...", optimizing the marketing nodes in the user's life cycle, building an automated, targeted, and accurate marketing process, continuously reaching and activating users, and guiding users to take triggering actions at one time.

2) Action: Drive user actions

In order to drive users to take action, the most important thing is to meet their psychological expectations. What kind of content can attract users' attention? How to implement the scene story? How to build a personalized marketing content matrix?

To solve the above problems, we need to focus on the user life cycle journey, understand their product demands, and build a detailed user portrait.

When drawing user portraits, we should focus on digging deep into the details of users' product function demands, their circle positioning, etc., and build up real scenarios in the user path in a chain-by-chain manner. When the collected user portraits are comprehensive and clear enough, we can build rich scenarios and content strategies that are adapted to them in the marketing chain to meet users' psychological expectations for the product.

3) Rewards

Provide a variety of potential rewards to maintain user interest and achieve retention. Valuable reward behaviors can cultivate user behavior habits, which can be roughly divided into the following three categories:

① Social rewards: obtaining interpersonal resource rewards through interaction with others.

For example, the fitness interest groups in the fitness software keep allow people to form groups based on their interests, share knowledge and exchange experiences with each other, break the shackles of circles, and gain interpersonal rewards through social identity.

② Prey reward: obtain specific resources or information from user behavior.

For example, a learning material package launched by an educational institution can be obtained for free by sharing it on WeChat Moments, and users will receive resource feedback after completing the dissemination behavior.

③ Self-reward: Experiencing a sense of pleasure, control, accomplishment, and finality during the behavior.

The check-in function is common in language learning apps. It drives users to complete periodic daily learning check-ins through rewards or punishments. In this process, the sense of control is enhanced by controlling one's own will. When the specified target deadline is reached, users will gain a sense of closure because of completing the task. The improvement of their own knowledge reserves will generate a sense of accomplishment, and ultimately they will enjoy their own self-reward.

4) Investment: User investment in the product

When users invest a lot of time and energy in a product or service, it is easy to establish a cost barrier, which invisibly raises the threshold for user churn.

IV. Conclusion

The retention thinking starts from the perspective of user retention. The product-oriented traffic has created rapidly iterated products. It is no longer suitable for the industrial Internet era where user needs are precise and effective. The change in measurement standards has led to a service-oriented retention thinking, which deeply empowers the establishment of effective interaction and close connection between enterprises and users.

Author: Yingyu MA

Source: Yingyu MA