In the digital age, every business is a software business. This blog post highlights the importance of DAU (Daily Active Users) in measuring success for businesses.
Every successful business owes its success to the users who actively use it on a day-to-day basis. The kind of people who will pay a few bucks every month for using your service is called subscribers.
These days, digital products have been put into two categories: subscription-based and free to use. The former category has grown to be the most beneficial for businesses since they provide a reliable revenue stream.
The metric that enables you to measure subscriber success is called DAU (Daily Active Users).
What exactly is a Daily Active User?
It simply means someone who uses your product every day.
For example, if you are running an important social media channel, it would be great if your users often visited your page and used its features. So, in the given scenario, even if nobody signed up to become a subscriber of your social media page, it would still have active users.
Similarly, if there are no subscribers on Netflix but people frequently use their streaming feature, it also qualifies as having active users or DAUs.
In short, DAUs define the relationship between your users and your product.
DUA vs. MUA
According to a white paper published by Google titled Growth Engines, DAU matters more than MAU (Monthly Active User) because it allows businesses to measure campaigns regarding how effectively they convert daily visitors into paying subscribers.
This metric can also be used in assessing how successful an acquisition campaign was concerning user retention.
If you want your site or app to attract more users, you need to know that DAUs are basically the lifeblood of every business since their main motive is customer satisfaction.
If there has been a slow flow of incoming traffic on your website, then only the hardcore fans who visit it frequently will end up becoming paying customers.
These users are the ones to target rather than focusing on occasional visitors because DAU can measure more than just subscription rates.
If you look at it from a different angle, every business comprises people who share common interests and preferences.
The best way to make them interested in your product is by understanding what they want and how much they will be willing to pay for it.
In an age where there is an ever-increasing amount of competition, businesses must turn their focus toward relevant metrics that will help them grow faster and sustainably.
Google Analytics allows you to track things like Most Active Users (MAUs), New Users (New MAUs), Returning Users (Returning MAUs), Daily Active Users (DAUs), Returning Daily Users (RDU), and so on.
These metrics tell you how often users returned, how often they used the app or website, etc., which is crucial for businesses.
What exactly do all of them mean? Let’s take a step back
In this digital age where social media channels are getting increasingly crowded with every passing day, people want to find out only one thing: what new thing will make their lives better or easier in some way or another?
It isn’t easy to distinguish between websites that provide valuable services and those that just offer fluff. Trends have changed over time because audiences are beginning to get educated about new products being offered through different websites and apps that may not necessarily be helpful for them.
Owing to this reason, businesses must transform into a subscription-based model that provides their audience the best of their services.
If you have noticed, companies’ strategies nowadays include selling a certain product and providing regular value-added content on social media channels.
So, every business has understood that they cannot just sell something and forget about it since people will lose interest if there is no further engagement.
In doing this, DAU works both ways: your website or app needs active users to grow its subscriber base, but it also helps grow subscribers because active users are probably more likely to buy your products.
On the other hand, even if you do not want more subscribers, keeping an active user base will help you convert them into paying customers because these users are more likely to engage with your business over time.
Secondary Metric
Daily Active Users can also be used as a secondary metric for measuring the success of marketing campaigns or content creation strategies simply because the audience which DAUs bring is more relevant than those who visit only once every few weeks.
For instance, if you are running a campaign on Facebook that targets daily visitors, then DAU should tell you how your strategy is working out since most of these visitors may not necessarily become subscribers.
And addressing a Netflix example again, even though it has millions of subscribers but very low DAUs, it means that its website lacks in creating an engaging experience for its audience and consequently losing potential return users.
Investing in relevant content is helpful for every business since it allows them to understand more about their audience and how they can keep them invested by providing more value-added services.
Look At Your Analytics
If you take a look at your analytics after a while, you will find out that the number of DAU has dropped while MAU continues to increase. This may be because some users have abandoned the app or website, stopped using it, or changed their interests altogether.
It is hard to retain everyone who signed up initially, which means engaging with new users will always be essential for any business’s growth, so they do not lose track of the most active individuals.
To reiterate everything we just discussed, Daily Active Users are crucial for understanding people who regularly show consistent engagement with your product or service. This will help you keep the most loyal active audience while growing new ones who may become paying customers in the future.
