Expanding on Industry Terms: Retention, Churn, and Stickiness

Every industry uses specific, highly specialized language. This language is very useful when communicating concepts that are unique to an industry and helps to signal to others in the industry that you are knowledgeable in your field. While there are many benefits to using industry jargon, it can often be difficult to understand if you are not part of that industry. Verto Analytics took a look at some of the most important industry terms and how these metrics can become a vital tool for you.

Retention: who is staying with you?

Retention equates to the amount of users that continue to use a service over a given period of time. In essence, retention captures how many consumers stay with a service. This is a useful data point to measure vital signs of a company. More importantly, isolating the users that are staying with a service is a strategic way to learn more about what demographic to target. Analyzing retention is an important asset for examining a company’s performance as well as gaining key audience insights.

Churn: who are you not reaching?

Churn refers to the percentage rate at which users of a given service leave that service from one time period to the next. More specifically, churn examines how many customers a company (or app or service) loses over a specific period of time. This number is extremely important to quantify and understand when attempting to determine which demographic is falling through the cracks. In a world where companies strive to be lean, it is just as important to understand why people are leaving as it is to understand why people are staying. A high churn rate can indicate a lack of engagement and loyalty, and more broadly a high level of dissatisfaction with the service. Analyzing churn is a great way to gain insights into improving your service and retaining users.

Stickiness: who is most engaged?

Stickiness is a measure of user engagement which answers the question, “how likely is a user to return to the service day after day?” It is calculated as total daily users over total monthly users. While retention captures the amount of users that are continuing to use a service, it does not depict how frequently a consumer is using a service. For companies that rely on advertising revenue, a high stickiness rate is vital for monetization strategies. A high level of stickiness indicates loyal, engaged users. This metric is extremely useful when detailing your audience to potential advertisers. All of these metrics provide unique and critical audience insights that can provide a deeper understanding of your audience.

All of these terms highlight unique metrics that can help your business learn more about your average consumer, help increase user engagement and help you tell a compelling story about your audience to sell to advertisers.

Interested in how Verto uses these metrics to analyze a service’s performance? Download our case study on user loyalty and retention hereSubscribe to our newsletter for the latest insights, or follow us on Twitter and LinkedIn.