How you define an active user matters.

When you use the wrong criteria, you end up building for the wrong users. This affects your decision making process and sets your product up for failure.

This article helps you avoid mistakes by explaining what an active user is and why it varies for different products.

As you read, you’d also learn:

• Key metrics for measuring active users
• How to track active users for your tool
• How to improve active users with better onboarding and other strategies

What is an active user?

An active user is an individual who regularly engages with and utilizes your platform and has a high user engagement score.

The active user metric is commonly used to measure app performance, but the definition of an active user can vary depending on the product.

For example, an active user utilizing a social media management tool will engage and schedule posts multiple times every week. However, an active user utilizing an event planning tool will create events once a month or a couple of times a year.

Important metrics for measuring active users

Why are active users important?

Active user tracking helps you measure growth, churn, and product stickiness at a high level. With this data, it becomes easy to take proactive steps and boost overall business health.

Below are the key metrics for active user measurement:

• Daily active users (DAU): The total number of unique users who perform a specific action in a 24-hour period. Track this metric if you have a tool that customers need to use daily—e.g., project management platform like Asana, team communication tool like Slack, etc.
• Weekly active users (WAU): This metric tracks the unique users that logged into your platform and engaged meaningfully in a 7-day period. A popular use case for this is analytics tools; people don’t use them daily, but most teams check their analytics dashboards at least once weekly.
• Monthly active users (MAU): A monthly active user is one that carries out specific actions within a 30-day period. For instance, photo editing apps and banking apps don’t expect frequent visits, but their engaged users should log in a few times monthly.
• DAU MAU Ratio: This metric helps you understand how often users return to your app. Tracking it enables you to gauge product traction and build revenue projections. Whether your platform is frequently used or not, always measure this ratio regularly to keep track of stickiness.

How active user tracking helps track business health

Your active user metrics say a lot about your company’s health. From this data, you can uncover insights to enhance the user experience and boost retention.

Here are a few examples of the insights you can generate:

• An increase in daily active users indicates a spike in new users. You can segment users into different cohorts to analyze what channels users access your product from.
• Increased DAU with stagnant paid customers could mean your trial-to-paid conversion flow needs optimization. Analyze to see why some users converted and others didn’t. Then, see if you need to create a more engaging onboarding or increase the trial length.
• Very high DAU to MAU ratio indicates people are signing up but not sticking around. This indicates a retention problem that needs to be addressed ASAP.

How to track active users

Hopefully, you’ve been sold on the importance of tracking active users for your platform.

This section goes deeper, showing you how to begin.

Define active user criteria

As mentioned earlier, an “active user” varies from product to product, so take some time to define your criteria based on how users engage with your tool.

Begin by identifying which action(s) deliver the most value to users and drive product stickiness.

One more thing. When defining your active user criteria, you can also check competing products to see which features are most used and enjoyed by their users. Chances are your competitors’ active users share the same attributes as yours.

Set and track custom events

With software tools like Userpilot, you can create and track several custom events simultaneously.

By viewing the results, you can know the number of active users over a specific period and what aspects of your tool they interacted with.

Choose a time period and extract data from your analytics tool

Do you prefer to view daily engagement data, or do you want it weekly and monthly?

Determine your target period, then collect data from your analytics dashboard. Most tools let you filter results by time, events, paid plans, etc., allowing you to calculate active users for different segments.

Visualize the results on bar charts, line graphs, etc, for easy interpretation.

How to increase your active users

You can grow your active users in a number of ways. Use your app usage data and user feedback to make feature updates, UI enhancements, and easier onboarding.

Let’s get into more details.

Use gamification to encourage customer stickiness

Use gamification elements to give kudos when a user successfully finishes a task.

This not only makes the product more fun but also provides a sense of accomplishment, which can lead to increased usage and customer stickiness. It taps into users’ natural drive to achieve and be recognized.

One way to do this is to display animation when users reach milestones. A good example is Asana’s task completion animation.

For Asana, an active user is someone who sets, tracks, and engages with tasks, so the in-app flows and gamification are carefully designed to encourage these actions.

Use tooltips to reduce onboarding friction

Onboarding is a critical phase for new users. Reducing friction during this process encourages users to stick with you and engage consistently.

The logic is simple: poor onboarding means users will struggle to get the hang of your tool quickly. Out of frustration, many of them will churn or become inactive.

The opposite is true for aided onboardings, and that’s where tooltips come in. Use these to bring attention to important features and help users derive value quickly.

Tooltips offer contextual guidance for both primary and secondary onboardings so make the most of them.

Collect feedback to understand active user better

Don’t assume you know your users. Gather feedback at various points in their journey to understand what brings value to them.

Combine NPS surveys with open-ended questions to get both quantitative and qualitative data.

When you’re done analyzing the results, use the insights generated to drive better engagement. For instance, if the survey shows your power users regularly engage and derive value from a specific feature, design your onboardings to bring new users onto the same path as well.

By continuously seeking feedback and improving, you will adapt to changing user behaviors and preferences, ensuring that your product remains relevant and appealing to active users.

Conclusion

Seasonal trends, product lifecycle, and the user experience all affect your active user metrics in SaaS.

By regularly tracking these, you can keep tabs on growth and swiftly intervene when engagement is declining. The data you obtain from tracking also gives you insights into ways to boost free-to-paid conversion rates, increase retention, and generally enhance your product experience.

Want to get started with active user tracking for your SaaS? Get a Userpilot demo now to begin.