Refresher on Retention - Issue 236

How to measure and report retention: cohorted and blended

Welcome to my Data Analytics Journal, where I write about data science and analytics.

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Over the years, I've shared a lot about retention, but it's scattered across different sections or featured in other newsletters where I was a guest writer. As I am now onboarding 2 new analysts on my team, I was looking for a consolidated guide on retention, rather than sharing a list of 40 articles from my newsletter.

So today, I want to consolidate the must-know things about retention - its definition, best practices in reporting, examples of reports, and key points to remember - into this single publication.

10 reasons why working with retention is difficult

1. Retention KPIs include multiple variables such as - signups, user activity, often with filters, and varying date ranges. You often can't finalize reporting until all other metrics are in place - Top of funnel, transactions, DAU, etc.

2. That’s why, creating and automating retention reporting takes time, and maintaining it requires effort.

3. It is an eco-system metric. Retention isn't directly actionable or sensitive. You need to break it down to make sense of it or take action.

4. There are many types of retention, and no single “right” method exists. Each company defines and calculates retention in its own way.

5. It’s actually wild out there: some do unbounded, others N-day, or cohorted, non-cohorted, blended, adjusted, weighted, etc.

6. This makes using retention benchmarks absolutely pointless!

7. Every new executive brings their own definition of retention, often changing it to adjust to a specific cohort or activity every few months. And you were wondering why I don’t like semantic layers.

8. To make retention actionable, you have to link data to specific marketing campaigns, product launches, or A/B tests.

9. Certain types of retention (unbounded) can’t be used for MoM or YoY growth analysis. You will have to maintain multiple versions of the same metric, introducing more confusion for the teams.

10. I've never had luck with retention reporting from analytic tools such as Heap, Amplitude, Mixpanel, RevenueCat, and Chargebee, and I often have to replicate reports myself to ensure they are accurate and trustworthy.

Retention reporting is different for B2C, B2B, and SaaS

Retention for B2C has a different meaning and objective than it does for enterprise, B2B, or SaaS companies.

Retention for B2C (Calm, MyfitnessPal, YouTube, eBay)