Knowing where to begin with engagement can be kind of daunting. You want to pick out users who are active, but have a bit more commitment or loyalty to your product, and even more than that -- it’s not enough to know who’s engaged, but just how engaged are they? When we’re talking about engagement, those are the two questions we’re asking. How many engaged users do I have? And, of those engaged users, what’s their distribution of engagement? We use engagement metrics to identify users who are getting repeated value out of our product, in an attempt to repeat those behaviors in new, and resurrected users, and drive engagement for everyone who comes across our product.
In determining the type of engagement that’s right for you, it really comes down to knowing what an engaged action looks like, and how often you’d like to see your users doing that thing. In our Guide to Product Metrics, we say “Engagement could be defined as the number of key actions taken, minutes of video watched or number of transactions completed.” And, as it’s (ideally) the second step in a user’s journey after becoming activated, we usually want to set up our engagement metric as a ratio of [engaged users]/[active usage]. This sets us up to successfully determine: of everyone in my active user base, what percentage is finding the aha! moment in their product experience.
To build an engagement metric, determine the moment a user finds value -- completing a transaction, viewing a report, making a purchase, finishing a video -- and set it as the numerator. Take your defined active usage metric -- daily active users, weekly active users, or monthly active users -- and use that as the denominator.
For a subscription based video streaming service, a good engagement metric might look like:
- Minutes Watched / WAU
This will help the product team know how deep into their content their active user base is getting. The moment of value for a service like this comes from watching most or all of the provided content. If they can keep a pulse on how much content their active user base is consuming, they’ll have a good leading indicator on whether they’re surfacing or providing valuable content. For an online clothing retailer, a good engagement metric might look like:
- Number of items purchased / Weekly Buyers
The aha! moment in this instance comes when a user realizes how little lift it is to make multiple, quick and easy purchases from this website. Anyone who’s in the single-item-purchase space hasn’t gotten all the way to the real product value. Discovering the ratio of items bought to users who make purchases will help this team determine just how engaging their product is. If this ratio dips below 2, they made need to iterate -- revisiting the inventory of their site, double checking their workflow is as easy as intended, or even possibly driving up the number of weekly buyers.