Retention is a number of users (in percent) who stay active sometime after the first use of a product. Retention is relevant not only for mobile and web apps but for any B2C-business as well: everybody wants a user to come back to a product again and again.
How to calculate retention?
There are 2 answers: a simple one and a complex one.
The simple answer: take the users left and divide them by the overall number of users. That’s it.
The complex answer: there are many ways to calculate retention. The difference is in what they consider “left users” and what’s the number of users they should divide by. There’re full retention, classic retention, rolling retention, return retention, bracket-dependent return retention.
We’ve chosen 2 approaches to retention calculation:
- classic retention (1-day retention, 7-day retention, 28-days retention indices).
- rolling retention (rolling retention index).
We calculated a 1-day retention index as a number of users who came back on the following day after the first use of an app divided by the overall number of users who launched the app for the first time on a definite day.
As a rule, the 1-day retention index tells about user reaction to an app interface. A user will hardly try all the product advantages in 1 day, so he/she only reacts to its outer side: the convenience of use, interface friendliness, apprehensibility of the task it solves.
7-day retention index is calculated as a number of users who have returned in 7 days after the first launch divided by the overall number of users who launched the app for the first time on a definite day.
28-day retention index is calculated as a number of users who have come back 28 days after the first launch divided by the overall number of users who launched the app for the first time on a definite day.
A user usually understands all the advantages of an app in 28 days. A person is acquainted with it for a long time in order to understand what’s the place of an app in his/her life.
The more time has passed since the first app launch, the less is the retention of a corresponding day. But with some time, there are only the most loyal users left in the app and the speed of retention decrease starts to slow down.
For example, you can see that the difference between the 1-day and 2-day retention is more evident than 7-day and 8-day retention:
Rolling retention per day is calculated as a percent of users who are still active from all the users who launched an app on a definite day. The user is active when he/she opened an app at least once in 7 last days. That’s why rolling retention of 7 last days equals 100% (by definition):
Rolling retention is increasing as it gets closer to the present day. It’s essential to find peaks of rolling retention in the previous periods and find the reasons. Sometimes it may be due to the fact that some advertising campaigns worked actively on that day or there was an important update in a product. It was also noticed that this index has its seasonality. In particular, rolling retention on Friday is higher as a rule if compared to other days of a week. It happens because the users who have come to an app on Friday have a weekend to get acquainted with the app and become loyal to it.
Do you need to increase retention?
If you have a 100% retention in a year, you don’t need to read further on.
For all the others: you should increase retention! There’s a widespread phrase that a 5% increase in retention leads to a 25-95% increase in income. And it’s pretty close to reality. It’s more difficult and important to keep a user than to attract one.
Just remember Neil Patel’s article in which he confesses that one of the marketing mistakes was his paying more attention to user attraction rather than keeping a user.
The more a user stays with you, the more is his/her loyalty to you, the higher is the possibility of making a purchase. If you maximize retention, you maximize a user’s LTV.
How to increase retention?
It’s one of the eternal questions along with “Who’s to blame?” and “What to do?”.
And there are 2 answers to it: a complex and a simple one.
The simple answer: you should interest a user.
The complex answer: everything depends on a project. There are many tips and recommendations on the Internet and each of them is good for a definite cause.
LinguaLeo tells about how they could increase retention. It’s better to reveal app possibilities gradually, not all at once, so the user will be interested in launching an app every time and finding something new there. If you make a sequence of levels and tell a user what he/she will get on each of them, it will be a motivation to launch an app and linger there.
Oleg Yakubenkov has studied mobile games on App Store and has come to the conclusion that long time involvement is a necessary condition for a game monetization. You should also understand that in the beginning gameplay and the way you present it is the most important for a user and then a user should be shown a definite goal so gameplay will only be a means for reaching it. The game process is necessary for a gamer. Then you switch on competitive, social, clan mechanics which will increase users’ motivation.
Here’s a list of things that will help to increase retention in games:
- plot and characters. People get attached to definite characters and watch how the plot develops in a game.
- tasks. A gamer should have a feeling that it’s necessary to come back to a game to fulfill a new task every moment.
- property and collecting. A game should show a user the way he/she has already made (acquired property and awards).
- regular events. A game must demonstrate a user that it lives its own life with him/her but a regular presence will promise a user additional benefits.
- interaction with friends. The more friends you have in a game, the more beneficial is the atmosphere and less is a user’s desire to leave the game.
- different game layers. The more time a user spends in a game, the more new details and possibilities a user must be shown.
- gifts for comebacks. It’s a simple but efficient method that stimulates users to launch a game.
Game mechanics are suitable for non-game apps. Gamification is embedded into them more and more often. It stimulates users to be more active: virtual currency presents for returns, achievements, etc.
Retention is one of the most important efficiency indices. You should keep in mind that it’s more difficult to keep a user than to attract. And even a small increase in retention will give an evident income growth. Enhancing retention is an endless field for experiments, so be creative!