Daily active users (DAU)
The number of unique users that engage with your app within a 24-hour window. DAU is typically used by businesses where users are expected to interact with the app on a daily basis (e.g. Gaming).
What is daily active users (DAU)?
Let’s break it down a bit. An active app user is defined as someone who has downloaded and accessed an app. Although the actual definition of an active interaction can vary between verticals or even brands, the most common example of an active user’s interaction is an account log-in.
An online banking app, on the flip side, could define an interaction as making a transfer. An eCommerce app, on the other hand, could define it as adding an item to a cart, whereas a SaaS company could rely on software usage as an indication for user activity.
Either way, active users are identified through a personal unique identifier such as an IDFA (for consenting iOS 14+ users), email, user ID, cookies (for web users), or a combination of all, in case one fails.
Many businesses view DAU as a measurement of success. The more users choose to interact with an app on a daily basis – the “stickier” it’s considered.
How to calculate DAU
Calculating DAUs could be regarded as deceptively simple, but it can become more complicated depending on how your activity is defined.
To get you started, begin with the following steps:
- Define your criteria for an active user.
- Define the frequency of engagement you’re looking to measure (DAU in our case).
- Collect the data using your analytics tool of choice, and sum the number of unique users who meet your active user criteria for the selected day.
Here’s a practical example of how this is put to use:
- Criteria – app user clicked a button, swiped, or scrolled.
- Frequency of engagement – DAU.
- On day X, the following engagements were registered:
- User 1 clicked a button, and then closed the app
- User 2 logged into the app but then remained idle
- User 3 logged into the app, scrolled, swiped, or clicked a button
- User 1 logged back into the app, and clicked another button
- Bottom line: Our DAU count adds up to 2. Why?
- User 1 is an active user (counted once)
- User 2 is not considered active
- User 3 is also an active user
Keep in mind that measuring DAU heavily depends on the long-term growth goals and business model of your company.
Different business goals = different active user criteria.
Why should you use it?
A growing volume of DAU is a good sign you’re doing something right.
Keeping track of your DAU count over time helps you assess the effectiveness of your campaigns, the popularity of your app, its growth potential, and the customer experience it delivers.
It also ties into other key metrics. Lifetime value (LTV) can’t be calculated without determining retention rates, and retention rates have to rely on DAU.
In other words, DAU provides you with a basic measure of the general health of your app, and maintaining a finger on the pulse of your DAU trends allows you to align your users’ needs with your values.
What are the limitations of DAU?
Viewed as a standalone metric, DAU can be misleading. A company’s definition has a lot to do with the numerical value of DAU, which makes fluctuations in DAU a lot more indicative when it comes to measurement.
It’s tempting to watch your DAU numbers spike and assume everything is dandy. But be skeptical of the upward DAU trajectory, especially if other business criteria aren’t looking as favorable.
It might sound counterintuitive, but active users don’t always equal engaged or happy users. Also, because an “active user” is defined differently by different brands, you can’t and shouldn’t compare statistics.
There’s no doubt that DAU is an imperative component in brands’ arsenal of metrics, but it can’t be the only one. If you focus on DAU alone and disregard other concerning signs, you’re very likely to miss out on crucial trends.
So, be sure to also keep an eye on your user acquisition (UA), in-app purchases, reviews, and customer feedback – which would give you a much more holistic understanding of your business health or, alternatively, the existence of a problem.
The DAU/MAU ratio
When paired with monthly active users (MAU), the DAU/MAU ratio allows you to measure the relative volume of monthly active users who engage with your app over a 24-hour time period.
Using this formula, you can forecast traction and potential revenue over time. But even more importantly – this ratio helps you determine the value of your product for your users by measuring how often they return to your app.
Here’s how it’s calculated:
And here’s a practical example:
Let’s say you had 2,000 DAUs and 8,000 MAUs during the month of August. Your stickiness ratio for that month would be 25%.
That’s a very happy place to be in, by the way. A stickiness average of 20% across industries is considered good, while 25% and beyond is considered exceptional.
How can you increase DAU?
A winning app engagement strategy has to encompass multiple channels like email, push notifications, in-app notifications, and re-engagement campaigns.
How do you harness all these channels in your efforts to ramp up DAU rates? Here are a few tips and pointers:
1. Push notifications
Despite being one of the most effective ways to engage your app users, if misused, push notifications are also one of the quickest ways to generate uninstalls.
So how often should you send push notifications to your users?
There are plenty of sources out there to provide you with best practices and benchmarks, but the most important thing would be to ask yourself: Am I offering actual value to my audience?
Push notifications should never be about quantity, but about improving your users’ experience using personalized and relevant communication.
To help your DAU numbers go up, keep an eye out for your push notification statistics, which will help you determine what works – and especially what doesn’t.
2. In-app messages
The more aligned your app experience is with your users’ needs and preferences, the more likely they are to continue using your app.
In fact, recent research shows that brands using personalized in-app messages are experiencing user retention rates of 61% to 74% within 28 days of receiving the message. On the flip side, brands that blast off mostly generic campaigns see retention rates cap out at 49% within 28 days.
Generally speaking, in-app messages are not intended for communicating immediate calls to action, but are nonetheless important notifications to receive. They can include warnings about app issues, payment failures, or version upgrades.
To ensure maximal relevance, it’s best to segment your audience based on regions, preferences, usage or history, using tailored messages that include real-time updates and links to personalized content.
3. Email / SMS
Retention comes down to being able to serve users well and keeping your app top of mind so that they’ll come back to it again and again.
After downloading your app, it might take your users some time to tap into its full potential. Keeping in mind that onboarding is a continuous process, sending your newly embarked users the occasional email – is a good way to maintain high DAU rates.
For example, email could be used to target users that were once active but have since kept their distance. It’s the least intrusive way to say “We miss you. Here are some exciting updates you might find useful”.
In the case of content apps, a user who was once active for 7 days straight but then didn’t open the app in 3 days – might appreciate an email with a link to an in-app trending article.
Proper audience segmentation could mean the difference between an idle to an engaged user.
4. Deep linking
So you’ve crafted the perfect email with an irresistible offer to redeem a special coupon. It’s personalized, it’s contextual, and it’s extremely relevant. That’s great. But then when clicked – it directs your users to your app’s general home screen. Not so great.
Attribution-fueled deep linking is at the heart of a true cross-channel strategy. By linking your siloed channels into one cohesive user experience platform, it ensures a consistent, hassle-free user experience, and enable your users to float through their user journey effortlessly.
Not only does deep linking helps you to remove as many obstacles along the user journey as possible, but it also allows you to build a long-lasting relationship with your users, and strengthen your competitive edge.
It has proven itself time and again to be an easily executed strategy well worth implementing.
Key takeaways
- In the app world, an active user is most commonly regarded as a user logging into their account. However, the various types of engagement that make up an active user can differ between business sectors and business goals.
- Calculating DAU could be regarded as deceptively simple, but can become more complicated depending on how your activity is defined. Determining your DAU over time will help you assess the effectiveness of your campaigns, and the customer experience your app delivers.
- To ramp up your DAU rate, your app engagement strategy must encompass cross-channel efforts. Be sure to leverage email, push notifications, in-app notifications, and re-engagement campaigns to offer your users tangible, personalized value. Higher engagement and retention will soon follow.
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