Case analysis: Tips to improve user activity and retention!

If a product lacks a complete activity and retention mechanism, users will eventually continue to leave. So how do we improve user activity and retention? We can conduct research and analysis on Baiguoyuan, Sephora, Chaos University, etc. to see what measures they have taken.

We have a consensus on traffic operations that retention is the real growth, which to a large extent restricts the space for product commercialization. Even if you have a large budget to purchase traffic, if the product lacks a complete active and retention mechanism, the end user will continue to leave, which is a waste of money.

As operators, we might as well summarize and analyze the reasons for low user activity and retention, which will help us find the correct ideas and methods to solve the problems.

1. Analysis and countermeasures of reasons for low user activity and retention

Reason 1: The product usage path is unclear and the experience is poor

For any product, users expect to use the core functions of the product, discover the value of the product, and gradually grow into loyal users of the product. However, if the product usage path guidance is not clear, it will cause trouble to users, increase their operating costs, and have an obvious negative impact on activity and retention.

Clear guidance is particularly important when new users use the product for the first time. The user's usage path should be simplified as much as possible so that users can use the core functions of the product in a short time.

For example, in Baiguoyuan’s mini program, all path instructions are very clear. For new users, a pop-up window will be displayed as soon as the mini program is opened to remind users to participate in the 1-yuan discount promotion, place orders with one click, and quickly experience the mini program's ordering process. The mini program also reminds users that there is a product classification menu hidden in the upper right corner for easy selection. If users want to buy groceries, they can directly find the entrance in the navigation bar at the bottom to save time.

Baiguoyuan Case

Reason 2: The threshold for using the function is too high and does not meet user expectations

When users find that the threshold exceeds their expectations while using the product, they will be more likely to give up, which will affect activity and retention.

Therefore, it is very necessary to lower the threshold for using the product, which also reduces the user's decision-making cost and makes it easier for users to quickly experience the core value of the product.

For example, for a high-priced knowledge-based paid product like Chaos University, if you want to become a formal student, you need to pay thousands of yuan. Obviously, this is a high threshold, and users will carefully consider whether to pay. In order to attract new users, a free trial qualification was launched on the mini program. Users do not need to download the APP, and can easily take free courses within a limited time to further understand the value of Chaos University. This plays a positive role in user activity and retention, as well as subsequent conversion and payment.

Chaos University Case

Reason 3: Insufficient product triggers and user usage habits have not been properly cultivated

If users fail to form stable habits while using the product, and there is a lack of continuous triggers to guide users, it will definitely have an adverse impact on activity and retention. Therefore, a reasonable wake-up and triggering mechanism can improve this situation of user silence.

Taking Luckin Coffee as an example, for low-frequency consumers who have not placed an order for a period of time, they will often push pop-up coupon packages and guide users to download the APP to use free coupons. While cultivating users' ordering habits, it is also convenient to use the APP PUSH to push more discount information in the future, thereby increasing the frequency of user repurchases. Usually, users who need to be awakened and recalled are in the dormant or churn period of their life cycle. This problem can be solved with the help of continuous preferential strategies.

Luckin Coffee Case

Reason 4: Inaccurate channel reach and uneven user quality

When choosing a distribution channel, you must consider accurate users first, because users from different channels will have obvious differences in their adaptation to the product. The user quality of some channels varies, and their demands are not completely consistent with the value provided by the products, which will ultimately be reflected in the overall user activity and retention of the product. Therefore, during the delivery process, we must continuously monitor the user quality of different channels and focus on delivery in precise channels, which can improve activity and retention.

For example, if the product is targeted at white-collar users aged 25-35 in first-tier cities, the selection of channels should be based on this. After a period of time, the effect of the delivery can be analyzed to determine whether the channel is accurate enough and whether it is worth long-term delivery.

Reason 5: Lack of user segmentation makes it difficult to achieve precise operations

When the user group covered by the product is very large, different types of users will show obviously differentiated demands for the same needs, which cannot be met by a single service or benefit. Then user activity and retention will also be affected, and may even cause user churn.

At this time, operations need to find user characteristics with obvious differences in demand, and then provide suitable services and rights, in order to effectively improve user activity and retention issues.

For example, Walmart’s mini program mall will first offer a new user benefit of 88 yuan in red envelopes to new users. This is a tiered operation for old users, with the aim of attracting users to complete their first order and retain them effectively. This welfare red envelope is actually a red envelope with discounts on different categories. Obviously, when users receive and use the red envelope on the mini program.

On the one hand, public account message templates can be used to remind users of expiring discounts, prompting users to make repeat purchases. On the other hand, through category user stratification, it is convenient to push category combination discounts to users in the future, generally in the form of coupons + products + benefits to improve user retention and conversion.

Walmart Case

When it comes to user stratification operations, there are generally three ways:

• Segmentation of new and old users: For example, special coupon packages for new users, 50% off for first order, exclusive free shipping coupons, etc. are common means;
• Category user stratification: According to the user's consumption data, users are labeled with category labels, and targeted category coupons are pushed to encourage users to place orders and buy more, such as 20 yuan off for fresh food with a purchase of 100 yuan or more, 30 yuan off for daily chemicals with a purchase of 150 yuan or more, etc.
• User stratification by portrait: Users can be captured and targeted for marketing based on their order frequency, average order value, age, etc. For example, preferential benefits on snacks and beverages can be offered to white-collar users, while preferential benefits on fresh food can be pushed to community residents.

Reason 6: Lack of user incentives and insufficient product appeal

Without an incentive mechanism, it is difficult for users to have reasons to continue to stay and be active in the product. This is very easy to understand. Operations should design a variety of appropriate incentive methods to guide users to jump to the target page, extend the time they stay in the product, and increase the value of single UV.

Taking Sephora's e-commerce mini program as an example, it has launched multiple privileges and discounts for users. Black card and gold card members can enjoy a 20% discount, and gold card members can also participate in the promotion 3 hours in advance. As for white card and pink card members, they can earn double points for consumption during the event. A landing page for upgrading to black card and gold card is also provided, so that they can enjoy the 20% discount exclusively for black card and gold card users.

Sephora Case Study - Member Promotion

When users add items to a cart, the page will remind them of discounts and guide them to click to jump to the designated activity page to purchase items. This not only ensures user activity and retention, but also increases users' average order value, resulting in higher order amounts.

Sephora Case Study - Free Gifts with Purchase

2. How to use the user incentive system to improve activity and retention?

Through the above analysis, we have found the unfavorable factors that affect user activity and retention. Usually, as an operator, we consider more about using the user incentive system to achieve the goal of improving user activity and retention.

Taking Chaos University APP, a commonly used knowledge payment application, as an example, I analyzed the user incentive system, which can be divided into three major sections: tasks, points and marketing.

1. Tasks section

For old users, they can obtain certain research value by watching the first broadcast class of each week and completing the class check-in. Different rewards and rights can be exchanged according to the accumulated research value of old users. At the same time, when old users complete classroom self-tests or homework exercises after attending classes, they can also earn credits. When they accumulate the specified credits, they can participate in the defense and receive a medal of honor. This is a very typical user growth task.

Chaos University Case Study - User Growth Task

There is no doubt that through the construction of user growth tasks, old users can fully perceive the value brought by the product, and can continuously strengthen their sense of identity with the product during the use process, thereby enhancing user activity and retention.

In order to further increase the activity of old users, after users complete regular learning tasks, they will also be encouraged to complete marketing tasks, that is, to let old users share the courses they have learned. When new users receive them, old users can also get research value rewards. In addition, old users will be rewarded with research value by inviting new users to join, which is all part of the marketing task.

Chaos University Case - Invitation Task

2. Points section

The research value mall of Chaos University APP belongs to the points section. Its purpose is to allow users to obtain enough research value to redeem rewards and rights, and to continuously and actively complete various tasks, thereby improving retention and attracting new users. When users use their research value to redeem courses and other benefits, they will be stimulated to continue to participate in tasks, and user retention and activity will be greatly improved.

Chaos University Case Study - Research Value Mall

3. Marketing

The marketing section provides users with the opportunity to earn research value, and the points section is the only channel for users to consume research value to obtain rewards. It can be seen that the two form a synergistic relationship, which can better promote user activity and retention, and in the process, improve the effect of attracting new users.

The marketing sector uses two types of fission activities as carriers: sales-oriented and customer acquisition-oriented. Among them, sales-oriented fission activities can use the method of group purchase and preferential admission to allow users to spontaneously spread the activities. When users successfully form a group and are enrolled, they can also receive research value rewards. As for the fission activities oriented towards customer acquisition, we will attract old users to actively share free selected gift courses to communities or friends circles through reward course redemption coupons and multiple research values, and ultimately achieve new customer acquisition.

Chaos University Case Study - Group Buying Fission

3. Dismantling the application of user incentives in common scenarios

The greatest significance of user motivation is that while the product meets user needs, it effectively stimulates and guides user behavior through interest stimulation, promotes user activity and retention, provides favorable conditions for product monetization, and ultimately presents the commercial value of the product.

It is not difficult to understand that user incentives mean what users need to do to obtain certain rights and interests. For operations, it means: clarify specific operational goals, formulate reasonable rules, and optimize based on user data feedback to ultimately achieve the indicators.

1. User Registration

When users register, a common incentive method is to give new users benefits and guide them to complete new users' tasks quickly. Usually these benefits are in the form of combinations and are distributed one by one after users complete different designated tasks. The purpose is to promote the activity and retention of new users in the short term.

For example, when users are completing their personal information and performing novice tasks, they can receive red envelopes, points and other rewards each time they complete a step.

2. Sign in

Signing in and clocking in is a very effective way to increase the daily activity of a product. Often, the sign-in and clock-in function is designed as a reward mechanism for phased target tasks. If you sign in continuously for a week, the reward can be doubled or you can enjoy a great value gift package, using enough gimmicks to attract user participation.

In addition, sign-in and clock-in can also be combined with honor incentives to enhance users’ sense of identity and encourage users to actively clock in.

The product is designed with a badge wall display function. When the user completes the check-in task at each stage, the system will issue a badge to the user and guide the user to share it to their friends circle, which will attract the interest of new users.

3. Tiered incentives

Some investment and financial management applications implement tiered incentives based on users’ different identity levels. Users with higher levels can choose more investment targets and earn more profits.

Under the tiered incentive model, on the one hand, users can clearly see the promotion paths for different identity levels, as well as the investment targets and estimated returns corresponding to different levels, so they are easily tempted to a certain extent and will complete the level promotion as required, unlocking more exclusive rights and interests, and increasing activity and retention; on the other hand, the platform can clearly understand the user's investment potential, which helps to accurately recommend suitable financial management packages to users.

The same approach has been used repeatedly in e-commerce. Just like the Sephora membership promotion case mentioned above, the preferential benefits that pink card, white card, black card and gold card members can enjoy are different. At the same time, it also provides a clear upgrade channel for pink card and white card members, which can better stimulate users to place orders and form continuous consumption habits.

4. Points lottery

The points-based gameplay is an easy and effective means of user motivation that can cultivate good user stickiness, enhance retention, and gradually turn users into deep users of the product.

In fact, in addition to being redeemed for fixed rights and benefits, points can also be used to provide users with rebates through point lotteries, which can further highlight the value of points. Users are very willing to participate in the lottery, which is closely related to the psychological needs of users. Obviously, this is designed for users to consume points, with the aim of encouraging users to continue to be active in the product and complete designated tasks to accumulate more points.

IV. Conclusion

The value of the user incentive system lies in allowing users to continuously strengthen their trust in the product and providing a mechanism for continuous linkage between users and products.

Although independent of the core functions of the product, the design of an effective user incentive system is inseparable from the core functions of the product. Otherwise, it will be difficult for users to perceive the benefits brought by the incentives, and it will still not play a positive role in promoting user activity and retention.

At the same time, the user incentive system will also be optimized and adjusted along with the user life cycle. This requires the construction of a complete data system as the basis for formulating incentive strategies, to achieve truly data-driven refined operations, and to point out clear operational methods for the company's lean growth.

Author: Mr. Dark Horse

Source: Mr. Dark Horse