April 26, 2024
min read

SaaS Adoption Metrics: Guide To Monthly Active Users For Customer Success

Monthly Active Users (MAUs) is a key SaaS adoption metric that helps customer success teams understand the level of engagement users have with your software product. It is a analogue for the amount of value users are deriving from your product and gives us information on the likelihood of churn and the expected customer lifetime value to be derived. As a leading metric of long term revenue understanding and managing this is central to the success of your software business.

Written by

Marc Chia

When it comes to understanding the users of your SaaS platform selecting the right metric is critical.  In our continuing series on SaaS adoption metrics we help break down what exactly MAU is, how to measure it and what you can do to improve it. The Monthly Active Users (MAU) is a metric often used by customer success teams to understand the engagement users have with their application. In many cases it is the most important metric and forms the core of any successful business model for SaaS.

What is MAU

The MAU number is intended to provide a general metric for user engagement with your SaaS product. A high MAU number shows that users are highly engaged and likely happy. Thus it is also a leading indicator for your customers likeliness to purchase/renew and their satisfaction with your software. MAU can be a good leading indicator for other key metrics such as Churn and Net Promoter Score (NPS).

There is no established standard of what is a good MAU number. Companies generally do not publicize their MAU numbers and it is rarely if ever part of the disclosure of companies in financial reports. The best way to think of MAU numbers is as a relative metric over time. The goal should be to understand the MAU and improve it over time.

Calculating MAU

There are three basic components to calculate the MAU:

Time Frame: As the name suggests, a 1-month period is the time frame for calculating MAU. In contrast a daily period would be the Daily Active Users. For consistency, teams may opt to look at this either from a last 30 days perspective or a calendar month perspective.

Activity: To qualify as active, a specific action must be undertaken by a user on your SaaS platform. It should be obvious that depending on the activity used the MAU number itself can be inflated or deflated. We discuss how to determine an activity later below.

User: In measuring the MAU, a user is counted once during the measuring period, it does not matter how many times he performs the tracked action. Every user is identified by a unique user id or unique number, such as a username, email address, or contact number. Companies have to take care in monitoring duplicate accounts or spam accounts which can affect the data.

What does activity mean

It should first be stated that there is no standardized event that qualifies as an activity for the purpose of MAUs. It varies from company to company. Every company uses its own formula to calculate MAU. Some companies count their registered users, while other companies count those users who visited their site, some companies count how much time any user spends on their site, etc.

At the most basic level of implementation, companies track MAU activity on the basis of logins. In other words, this is the number of unique users who logged in to the app in the last 30 days or the already logged-in users who perform any activity in the last 30 days. While this metric is easy to track, an MAU calculated in this manner does not account for the depth of the visitor's experience. It just counts the number of visitors, but not whether the user carries out a meaningful activity.

More complex implementations of MAU tracking may dive into a specific activation event on the platform that is valuable to a user. An example is on a e-signing platform such as Docusign, the activity may be sending a document for e-signing.

In determining what activity to track there are a few key factors to consider:

1) How sophisticated is your ability to identify individual users?

2) How sophisticated is your ability to identify individual activities?

3) What is the end purpose of tracking MAU?

Tips To Improve MAU

Tip 1: Understand Why MAU is Not Good

The most critical step to improving MAU is first understanding why MAU is low. There may be a range of reasons such as:

• The software design makes it hard to use

• Users have low technical proficiency and require more training/assistance

• Users are unaware of features that can help meet their needs

• The software currently does not meet users needs and preferences

Where possible collection of analytics and direct user feedback will be useful for understanding user issues so you can address them directly.

Tip 2: Provide personalized retraining & onboarding campaigns.

Where users have low proficiency or are unaware of features that can help meet their needs, having personalized retraining may be an appropriate solution. Bear in mind that in these cases users would already have some familiarity with the platform. They are not looking for a complete run through of the system again but are instead looking for specific workflow and processes to address their specific needs. The re-training process should focus on this inquiry first before providing the training required.

Another way of looking at this from a systemic perspective is that onboarding is a continuous process. Users need to continuously be engaged as they get more familiar and advanced in their usage. It may take some time for your users to fully utilize your app after downloading it. Keeping in mind that onboarding is a continuous process, sending an occasional email to newly enrolled users is a good way to maintain high MAU rates. Email, for example, could be used to target users who were once active but have since faded away. It's the least inconvenient way to say, "We miss you." "Here are some exciting updates that you may find useful." Another method of engagement is through in-application notifications or messages to engage your users on their next login. This can be set up by your product team or alternatively managed via digital adoption platforms that enable customer success teams to set up this engagement directly.

Tip 3: Provide personalized engagement

In cases where users may be unaware of features that can help meet their needs, personalized engagement may be of use. Personalised engagement may be via direct communication with the user. Other ways of delivering such engagement may be via in -application messages or notifications. The key to making such content engaging is designing engagement that speaks to the needs of such users. For example, you may want to share about the use cases of other users of a similar profile or provide educational content or feature tours designed for this type of user. In the case of content apps, a user who was active for 7 days in a row but then didn't open the app for 3 days might appreciate receiving an email with a link to an in-app trending article. A properly segmented audience can mean the difference between an idle and an engaged user.

According to recent research, brands that use personalized in-app messages have retention rates ranging from 61% to 74% within 28 days of receiving the message. Brands that send out mostly generic campaigns, on the other hand, see retention rates peak at 49% within 28 days. In general, in-app messages are not intended to communicate immediate calls to action, but they are important notifications to receive. They may include notifications about app problems, payment failures, or version upgrades. The goal should never be quantity, but rather to improve your users' experiences through personalized and relevant communication. Keep an eye on your statistics to determine what works - and especially what doesn't - to help your MAU numbers rise.

MAU as a key metric

MAU is a key metric to the success of any SaaS on a long term basis. Keeping high levels of engagement and activity shows that users are actively deriving value from your SaaS and is thus more likely to lead to reduced churn and increased customer lifetime value. Understanding and managing this is critical to not only customer success functions but also for product teams and overall stategic growth of your business.

If you are a customer success team looking to improve your engagement with users via in-application walkthroughs and messages please check us out at https://www.usertip.com or follow us on Linkedin for more tips to drive user adoption.

Usertip is the first Southeast Asia digital adoption platform designed to help scale your onboarding, training and support for digital solutions. Operating from Singapore, Indonesia and Australia our no-code platform delivers in-application walkthroughs directly on your digital solutions. Seamless user experience and on-demand learning are all delivered to your user’s fingertips within seconds. Click here to find out more.

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