Retention KPIs

Retention is the most important KPI in free-to-play mobile games. It is a measure of how many players are returning to the game after installing it.

Given the option, who would you prefer, a user who pays $100 once and never comes back or a user who pays $10 every week for 365 days? Obviously, you would prefer the latter. Similarly, to run a successful game, you would need users who can play and pay for a longer time.

To bring users, you would need to spend money on marketing . This is called User Acquisition cost. For most games, this is the biggest expense. So, if users are not staying in the game i.e., lower retention, it will reduce the profit.

Profit = Revenue - Cost

  1. Revenue = Ads +In App Purchase.
  2. Cost = Fixed cost like employees, infrastructure etc + UA cost On the other hand, if your retention is high, it will reduce cost and thus increase the profit.

Why Measure Retention?

Retention works like a funnel:

  1. D1 depends on how users feel about the Day 0 gameplay.
  2. D2 depends on how many users came back on D1.
  3. D3 depends on D2, and so on.

At each stage, a few users drop off. Our goal is to reduce these drop-offs. (D1 Retention = % of users come back on the day after installation)

KPIs to be Tracked

Here are the main KPIs to be tracked for the retention

  1. D0 Time Spent (in minutes)
  2. D1, D2 D3, D7, D15, D21, D30, D60 Retention (If a user stays till D60, they are more likely to stay in the game for a long time)
  3. DAU/MAU (Stickiness)

D0 Timespent

Research shows that D0 time spent is the strong signal. Users who play longer on the day of install, they will be more likely to come back to the game.

DAU/MAU - Stickiness

It measures the % of monthly users who play daily. DAU/MAU of 30% is considered good in casual games.

Rolling Retention

Some gaming companies also measure rolling retention.

  1. Retention Dx - % of users who return on the xth day after installation.
  2. Rolling Retention Dx - % of users who return on the xth day or later after installation.

In KPIs, we track the trend, not the absolute value. So, the trend of these two metrics is the same, and we can track either one of them. Since classic retention is the more popular one, we track that.

Summary

  1. Retention is the most important KPIs for a business. It will increase the user base over the time and thus overall revenue.
  2. D0 time spent is the biggest signal of retention. If you can increase this, all the other metrics will be subsequently increased.
  3. Retention is measured till D60. Post D60, % of drop is significantly low.