Q: What's the most important growth metric to get right?
A: Retention
Q: How do you know if you have good retention?
A: Read this: lennyrachitsky.com/p/what-is-good…
Q: How do you increase retention, if it isn't good?
Time for a thread 👇👇👇
A: Retention
Q: How do you know if you have good retention?
A: Read this: lennyrachitsky.com/p/what-is-good…
Q: How do you increase retention, if it isn't good?
Time for a thread 👇👇👇
1/ First, know that increasing retention is very hard. Unless you're super early stage, is unlikely to budge significantly.
2/ Nevertheless, this doesn’t mean you shouldn’t try. As @bbalfour says, “if you have poor retention, nothing else matters.”
As you'll see below, it is possible, and when you can pull it off it’s often the biggest lever you have to grow your business.
As you'll see below, it is possible, and when you can pull it off it’s often the biggest lever you have to grow your business.
3/ First, how do you measure retention?
You want to look at "cohort" retention: What percentage of new users are still active X months/weeks/days later?
A chart like this is the best way to start – each row is a cohort over time. Most analytics tools have this built in.
You want to look at "cohort" retention: What percentage of new users are still active X months/weeks/days later?
A chart like this is the best way to start – each row is a cohort over time. Most analytics tools have this built in.
4/ Second, you want to look at where your retention rate "flattens". A line charts like the one below is a great way to see this. If it flattens, that means there is a group of users who continue to find value in your product. Nice!
5/ There are seven ways to increase your product's retention:
🛠 Improve your product
👋 Improve your onboarding
⛓ Make it stickier
✋ Catch users before they leave
☝️ Remind users of your value
💫 Bring back users after they’ve gone
😬 Change your users
Let's dive in...
🛠 Improve your product
👋 Improve your onboarding
⛓ Make it stickier
✋ Catch users before they leave
☝️ Remind users of your value
💫 Bring back users after they’ve gone
😬 Change your users
Let's dive in...
6/ 🛠 Improve your product — deliver more value for users
This is at the very heart of retention. If you’re just starting out, much of your time should be spent here.
There are at least seven ways to improve your products value...
This is at the very heart of retention. If you’re just starting out, much of your time should be spent here.
There are at least seven ways to improve your products value...
7/ (continued)
1. Solve your customer’s problem better
2. Solve more of your customer's problems
3. Make your product cheaper
4. Make it faster, more reliable
5. Wait for network effects to kick-in
6. Wait for the world to change
7. Pivot
1. Solve your customer’s problem better
2. Solve more of your customer's problems
3. Make your product cheaper
4. Make it faster, more reliable
5. Wait for network effects to kick-in
6. Wait for the world to change
7. Pivot
8/ 👋 Improve your onboarding — connect more users to existing value
In practice, you’re more likely to increase retention by improving onboarding, vs. improving the product. Why? Because, it’s hard to invent sustainable new customer value.
In practice, you’re more likely to increase retention by improving onboarding, vs. improving the product. Why? Because, it’s hard to invent sustainable new customer value.
9/ (continued) Ways to improve your onboarding:
1. Manually onboard new user
2. Make sure new users experience your value
3. Increase the odds new users have a great time
4. Get more users through the flow
1. Manually onboard new user
2. Make sure new users experience your value
3. Increase the odds new users have a great time
4. Get more users through the flow
10/ ⛓ Make it stickier — make the value hard to give up
The next most common tactic to increasing retention is make your product hard to give up:
1. Build habits
2. Create incentives to come back
3. Sign annual plans
4. Integrate more deeply
The next most common tactic to increasing retention is make your product hard to give up:
1. Build habits
2. Create incentives to come back
3. Sign annual plans
4. Integrate more deeply
11/ ✋ Catch users before they leave — give them an excuse to stay
Though often done badly, it’s worth spending some time on your de-activation flow. Some users may not actually want to quit forever or have an issue that you can solve before they call it quits. Some approaches:
Though often done badly, it’s worth spending some time on your de-activation flow. Some users may not actually want to quit forever or have an issue that you can solve before they call it quits. Some approaches:
12/ (continued)
1. Let users “pause” or “snooze” instead of cancel
2. Give users an incentive to stay
3. Ask users why they’re leaving, and offer a solution
4. Remind users of the value they’ll lose
5. Predict churn and try to avoid it
1. Let users “pause” or “snooze” instead of cancel
2. Give users an incentive to stay
3. Ask users why they’re leaving, and offer a solution
4. Remind users of the value they’ll lose
5. Predict churn and try to avoid it
13/ ☝️ Remind users of your value — deliver value more often
Even when you do provide great value to your users, they may not actually find or remember it. Look for ways to remind them. This can be over email/SMS, in-product, or the occasional call.
Even when you do provide great value to your users, they may not actually find or remember it. Look for ways to remind them. This can be over email/SMS, in-product, or the occasional call.
14/ 💫 Bring users back after they’ve gone — remind them what they’re missing
Though rarely a huge lever, it’s worth thinking about ways to pull back users who at one point found your product interesting.
Though rarely a huge lever, it’s worth thinking about ways to pull back users who at one point found your product interesting.
15/ 😬 Change your users
And lastly, an often-overlooked element of retention rate is the quality of the users you’re bringing in, e.g low intent, the wrong audience. Shifting these could have a profound impact on your retention rate metric.
And lastly, an often-overlooked element of retention rate is the quality of the users you’re bringing in, e.g low intent, the wrong audience. Shifting these could have a profound impact on your retention rate metric.
16/ Here's a handy-dandy summary of all seven strategies
17/ And for much more, including tons more examples and context, don't miss the full post
lennyrachitsky.com/p/how-to-incre…
lennyrachitsky.com/p/how-to-incre…
