Retention - Sequoia Capital

Definition

Retention is generally depicted by plotting the percentage of users who return to either the product or a core feature over time.

• Flattening curves
• Declining curves
• Smiling curves

 

Rentention Measurements

Retention is measured relative to two factors: time frames and events

Time: Depending on the vertical of your product, a daily, weekly or monthly time frame may be most meaningful.

e.g.

travel product - quarterly

social app or game - daily

Events: It's also important to define what constitutes meaningful activity

e.g.

ridesharing app such as Uber - a completed ride

content streaming service - beginning to view a piece of content

messaging app - when a user writes or reads a message

 

Tools: Triangle retention chart

It shows the percentage of that cohort remaining after a given period of time

3 features to quickly identify changes in retention:

Horizontal

Diagonal

Vertical

commonly seen in subscription business that have annual plans, e.g. Amazon Prime