Skip to main content

What is Retention? (Product Management, Marketing terminology)

Retention refers to encouraging users to continue using an app, website, or service. It is a strategy to keep users interested and return after a single visit or use.

Why is retention important?​

Retention has a direct impact on user experience and sales. As users continue to use your app or website, they feel a stronger connection with your brand and become more loyal to your product or service. This helps increase long-term sales and customer retention.

Strategies to increase retention​

  1. Provide a personalized experience
    1. Keep users engaged by providing them with personalized content, recommendations, notifications, etc.
    2. For example, we analyze your search history, purchase history, interests, etc. to provide personalized recommendations.
    3. Corporate case: Netflix’s recommendation algorithm, Amazon’s product recommendation
  2. Promotes user engagement
    1. Introduce gamification, reward systems, challenges, etc. to encourage user participation.
    2. For example, offer users the option to earn points each time they use the app and redeem them for benefits.
    3. Corporate Case: Starbucks’ Starbucks Rewards Program
  3. Continuous communication
    1. Continuously communicate with users and maintain their interest through email, push notifications, SNS, etc.
    2. For example, new feature introductions, discount events, news, etc. are periodically delivered through notifications.
    3. Corporate cases: Uber’s email marketing, Facebook’s push notifications
  4. Troubleshooting and Support
    1. Increase user satisfaction by quickly resolving user issues and providing support.
    2. For example, we respond quickly to user inquiries and transparently communicate the problem-solving process.
    3. Corporate Case: Apple & Samsung’s Customer Support Services

How to measure retention​

Various indicators can be used to measure retention. Typically, the following indicators are used:

  1. Daily/Weekly/Monthly Active Users: Measures the number of users who used your app or website during a specific period of time.
    1. DAU (Daily Active Users): Number of daily active users
    2. WAU (Weekly Active Users): Number of weekly active users
    3. MAU (Monthly Active Users): Number of monthly active users
  2. Return Rate: Measures the rate at which previously visited users return.
    1. Rate of returning visitors = (Number of returning users / Total number of users) * 100 (%)
  3. Bounce Rate: Measures the percentage of users who stop using your app or website after their first visit.
    1. Bounce rate = (Number of users who bounced / Total number of users) * 100 (%)

You can increase user interest and loyalty by measuring retention and adjusting your strategy based on it. It is important to improve user experience and sales by establishing and executing an appropriate retention strategy according to the relevant industry.