Ryan Lucht
May 9, 2024
Before joining Eppo, Ryan spent 6 years in the experimentation space consulting for companies like Clorox, Braintree, Yami, and DoorDash.
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What is the DAU/MAU Ratio? In Simple Terms
Understand the DAU/MAU ratio and how it reveals why users stick with (or abandon) your SaaS. Learn calculation methods, benchmarks, and improvement strategies.
Trying to figure out if users genuinely enjoy your SaaS product can be challenging amidst reams of conflicting data.
A key metric that cuts through the noise is the DAU/MAU ratio.
This guide will explain what DAU (Daily Active Users) and MAU (Monthly Active Users) are, why they matter, and how to calculate and improve your DAU/MAU ratio.
Understanding this ratio can help you see how often users engage with your product, offering insights into user retention and product stickiness.
Let's get into the specifics of what makes your product work for its users.
Today’s primer will cover:
What are DAU and MAU, and why do they matter?
What is the DAU/MAU ratio?
How to calculate the DAU/MAU ratio
What is a good DAU/MAU ratio
How to improve your DAU/MAU ratio
Let’s get started.
Understanding DAU and MAU
Let's start by breaking down two essential metrics for understanding if people are using and loving your digital product.
What is DAU?
DAU stands for Daily Active Users. Think of DAUs as your product's daily regulars. These are the folks who log in, engage with features, or take meaningful actions (whatever "active" means for your product) within a 24-hour period.
What is MAU?
MAU stands for Monthly Active Users. MAUs give you the bigger picture. This metric represents the total number of unique users who interact with your product within a month. It's like your monthly headcount of engaged customers.
Why DAU and MAU matter
Tracking DAU and MAU isn't just about numbers; it's about understanding your product's health and how users interact with it. Here's the breakdown:
Growth checkup: A growing MAU suggests you're attracting new users. Couple that with a strong DAU, and you know people aren't just signing up and disappearing — they're coming back for more.
The "stickiness" factor: How many of your monthly users are returning day after day? This is where the DAU/MAU ratio (which we’ll explain in the next section) comes into play. It tells you about your product's "stickiness" — are people making it a regular part of their routine?
Testing the impact of changes: Did you roll out a new update or feature? Keep an eye on your DAU and MAU. If you see those numbers climbing, it's a sign that those changes resonate with people. Conversely, a dropping ratio suggests you might need to rethink your strategy.
What is the DAU/MAU ratio?
If you want a quick snapshot of how well your product keeps users engaged, the DAU/MAU ratio is your go-to metric.
The DAU/MAU ratio tells you the percentage of your monthly active users (MAU) who also engage with your product on a daily basis (DAU). This simple calculation is a powerful tool for understanding:
User retention: Are people coming back day after day, or do they fizzle out? A high DAU/MAU ratio suggests you're fostering loyalty.
Product stickiness: How much has your product become a part of your users' routine? This ratio gives you a sense of that.
Engagement levels: A higher ratio hints at deeper and more frequent engagement with your product's features.
The formula for calculating the DAU/MAU ratio looks like this:
DAU/MAU Ratio = (Daily Active Users / Monthly Active Users) x 100
How to calculate the DAU/MAU ratio
Calculating your DAU/MAU ratio is a key part of understanding how engaged your users are. Let's break it down step-by-step and then explore what the resulting numbers actually tell you.
Step 1: Define “active”
Before you start counting, you need to decide what makes a user "active" for your product. This could be:
Simple login: Simply logging in might be enough for some products.
Feature usage: Engaging with a specific feature or set of features.
Purchase: For e-commerce or mobile apps, a purchase might be your metric.
Remember: This choice will depend entirely on the nature of your SaaS.
Step 2: Gather your data
DAU: Count how many unique users meet your "active" definition over a single day.
MAU: Count the unique "active" users throughout an entire month.
Note: Most analytics tools track this data for you, making this step pretty easy.
Step 3: Do the math
Now simply apply the DAU/MAU ratio formula.
Example: Let's say you have 800 DAUs and 5,000 MAUs.
Your calculation would be:
(800 / 5000) x 100 = 16% DAU/MAU ratio
Interpreting your DAU/MAU ratio
Now it’s time to answer the key question — what does this percentage tell you? While there's no single "perfect" ratio, here's a general guide:
Below 10%: Suggests room for improvement in user engagement and retention.
10-20%: This is considered average across many industries.
20-40%: Your product is doing a good job keeping users coming back.
Over 50%: This indicates exceptional stickiness, often seen in social media or communication apps.
What is a good DAU/MAU ratio?
There's no one-size-fits-all answer to this question. A "good" DAU/MAU ratio depends heavily on a couple of factors:
Industry and product type
Social media and communication: These often thrive on daily usage, so you'll naturally see higher ratios (think 50% and above).
B2B SaaS products: Engagement might be less frequent, leading to lower ratios in the 10-20% range being perfectly healthy.
Travel app: Users might only engage heavily when planning trips, so a high ratio isn't always the ultimate goal.
These are just some general examples. The key is to look at comparable companies within your space to form realistic benchmarks.
Your own goals
What does success look like for your product? If you're an early-stage startup, simply seeing a growing DAU/MAU ratio can be a sign of traction and increasing engagement. For established products, aiming for industry averages or slightly above them might be the goal.
Going beyond the numbers: The importance of trends
Instead of obsessing over hitting a specific percentage, pay attention to the direction your ratio is moving:
Climbing: This signals improvements in your product, marketing, or onboarding are successfully keeping users hooked.
Flatlining: This means it’s time to investigate. Are you not acquiring the right users, or are they losing interest quickly?
Dropping: This highlights a potential issue with user experience or a lack of ongoing value in your product.
How to improve your DAU/MAU ratio
Let's dive into actionable strategies to improve both those daily and monthly numbers, ultimately increasing your ratio:
Strategies to increase Daily Active Users (DAU)
Personalize the experience: Tailor the onboarding and key interactions based on user needs. When people see the immediate value your product offers them, they're more likely to keep engaging.
Highlight power features: Analyze how your most active users interact with your product. Promote those high-value features to other users to drive daily interactions.
Nail the notifications: If appropriate for your product, use well-timed notifications or reminders to gently nudge users back, but avoid being spammy.
Strategies to increase Monthly Active Users (MAU)
Target acquisition: Make sure you're attracting users who are a good fit for your product to ensure they have a reason to stay engaged long-term.
Reduce friction: Analyze your user journey for any roadblocks. Smooth out confusing parts of the experience or excessive steps to lower the barrier to staying active.
Re-engage lapsed users: Segment users who haven't been active in a while and try to win them back with targeted outreach, highlighting new features, or offering personalized incentives.
The importance of testing and iteration
The best strategy for your product will be unique. Experiment with these approaches and track the impact of your changes on your DAU/MAU ratio. Don't be afraid to adapt, test new tactics, and continuously refine your approach.
Next steps
You should have a pretty solid grasp of what the DAU/MAU ratio is and how it’s relevant to improving your company’s bottom line.
But how can you truly dissect the data and use it to drive product decisions?
That's where Eppo comes in.
Eppo is a one-of-a-kind experimentation and feature management platform built to help SaaS companies delve into the factors that influence their DAU/MAU ratio.
With Eppo, you can:
Go beyond basic tracking: Eppo tracks meaningful user interactions within your product, not just logins. See which features are used most by your daily active users and identify potential stumbling blocks hindering engagement.
Visualize user journeys for actionable insights: Eppo maps out how users move through your product. This unveils which features contribute to daily usage patterns and what elements might need improvement to encourage repeat visits.
Segment users for deeper understanding: Analyze your DAU/MAU ratio by factors like user demographics, acquisition source, and feature preferences. This reveals which user segments are most likely to become daily regulars, giving you tailored insights for targeted engagement strategies.
A/B test for targeted improvements: Eppo lets you experiment with onboarding variations, new features, or UI changes. Precisely measure how adjustments impact your DAU/MAU ratio, providing indisputable data on what drives higher daily engagement.
The Eppo difference: By revealing the actions, behaviors, and preferences of your daily active users, Eppo helps you identify opportunities for improvement with your product for maximum DAU/MAU growth, boosting retention, revenue margins, and long-term success.
Ready to optimize your DAU/MAU? Book a Demo and Explore Eppo.
Understand the DAU/MAU ratio and how it reveals why users stick with (or abandon) your SaaS. Learn calculation methods, benchmarks, and improvement strategies.
