Cohort retention basics

Retention measures how many users from a given cohort are still active after a period. It is essential for validating long‑term value, product‑market fit, and sustainable growth.

Formula: retention (%) = active users at period ÷ original cohort size × 100. Month 1 (M1) gives a read on activation quality; M2–M3 show whether users develop ongoing habits.

What each input means

• Cohort size: Users who entered the product in that month.
• M1/M2/M3 %: Share of that cohort active in each subsequent month.

How to use the calculator

1. Add cohorts by month or segment you want to compare.
2. Enter the cohort size and retention percentages for M1–M3.
3. Review the summary for average retention and number of cohorts.
4. Compare cohorts to identify where activation or long‑term value is weaker.

Interpreting results

• Average retention today: 70% at M1, 55% at M2, 45% at M3.
• Large drop from M1→M2 often means users don’t build a repeat habit.
• Stable M2→M3 suggests sustained value or sticky workflows.
• Benchmark internally over time; absolute benchmarks vary widely by product.

Example

If M1 averages around 70% and then drops to 55% at M2, focus on reinforcing value moments and prompts that bring users back to the core workflow in weeks 2–4.

Common pitfalls

• Mixing seasonality and growth spikes—compare like cohorts to avoid bias.
• Using logins instead of meaningful activity—define “active” as completing a core action.
• Small cohort sizes—aggregate or smooth to reduce noise.

Actions to improve retention

• Map activation steps; remove friction and reduce time‑to‑value.
• Segment by source, plan, or persona; prioritize cohorts with the biggest gaps.
• Encourage repeat usage with timely, contextual nudges and saved workflows.