This topic is taken from a conversation, The Basics of Growth-Engagement & Retention, between Andrew Chen, Jeff Jordan, and Sonal Chokshi on the a16z Podcast. Cheers for the valuable knowledge.

“Without the right marketing metrics, you’re shooting in the dark.” -Ian Brodie

We’re no longer in the medieval ages of marketing where we slapped advertisements up on TVs and the side of buses and crossed our fingers it drove more sales.

No, the marketing world has gotten sharp with measurement and will only continue to get more performance and impact driven.

We recently mentioned the most important growth marketing metrics to track, but one metric in particular, MAU, can often be the strongest indicators of the startup’s longevity and ability to grow.

To expand upon this further, Daily Active Users/Monthly Active Users (DAU/MAU) is a ratio that should be given further attention.

Do the same people come visit your app or ecommerce page daily?

Once a week?

Every perhaps once every few months?

Granted the “benchmark” DAU/MAU will be different for each industry (ex. a site selling travel deals will have a much lower ratio than Pinterest), but tracking what your DAU/MAU is over 6 months could really powerful in understanding growth.

And what if you find your ratio is dropping over time?

In short, it means that your customers are churning (i.e. leaving) and you can implement some of the following tactics to stabilize your DAU/MAU:

• Shift your paid acquisition marketing resources to focus exclusively on engagement and retention
• Start implementing the most common engagement & retention practices (push notifications, content marketing, email marketing, community building)
• Do deep user experience research and uncover ways to improve the product, making it more valuable to the customer

A great example of a company being keenly mindful of DAU/MAU is MyFitnessPal.

Daily, if you’ve forgotten to track your breakfast or lunch, it’ll send you a light push notification saying “You’ve tracked your meals for the past 5 days, don’t miss today!”

Hope this was helpful. Have a question about your startup’s DAU/MAU? Feel free to comment below or message me with further questions.

~JK