Acquisition vs. retention
After listening to many YC and Indie Hackers podcast.. it becomes clearer and clearer to me that product market fit is a function of retention.
And the way to measure retention is to look at cohorts of users and their usage of product over time.
I know a lot of people are focusing on acquisition efforts only.
Is anyone here actually measuring retention in your startups??! If yes, how are you doing it?
Hey John,
In my experience, power user curves are the best to use for retention, and comparing between cohorts.
And if you look at 1/3/7 day retention, that's a great leading indicator for retention long term.
This is the best article I've found; https://andrewchen.co/power-user-curve/
He also discusses 1/3/7 day retention in another article.
Most of the apps out there have this capability; I usually recommend Amplitude. It'sfree up to 10M events / month, which is a lot for most SaaS companies.
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Are you looking at using this for MetricsJar?
Seems like it might be difficult to compete with the current offerings.
I think there is probably a product somewhere in there that would help simplify this for a lot of startups.
I would ask -- how can you turn those analytics into insight and then into action? It might be a longer road / bigger product than you're intending, though.
-> Analytics are great, insight is better, action is best.
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Especially for smaller startups, their needs can be quite different than large startups with thousands of users. For smaller startups you really want to understand each customer -- so maybe there is an opportunity there?
But how much can you charge that market?
The nice thing about that market is that it's growing, and that people are quick to latch on to software that works well -- if I'm running my own startup and I'm a customer of another startup, if I see they have a tool that does a really good job or does something interesting, I'll use it too. I think that type of virality would definitely be necessary if you are going to have a lower price offering.
Just some things to think about.
Thanks so much for the detailed reply.
A lot of YC companies are b2c and have huge numbers where cohorts make sense.
If you have 10 signed up users a week it doesn't make much sense.
I do plan on adding https://amplitude.com/ and I believe they give this feature to see cohorts.
Yeah.. 'cohort' is a jargon.
What I mean is how are you currently tracking that 10 signed up users that week are still around, actively using your product after 2,3,4,5,6,7 weeks of signing up?
They are churning soon, but it won't show up on Stripe/Profitwell because they haven't cancelled their subscription yet. When they cancel, it's usually too late to investigate why.
Data is most likely not significant to see if you have PMF, but would be cool to email them and see why they stayed.
The author of jobs to be done would interview people who actually bought the product and see what made them do it.