Metrics like product utilization, ROI, or customer happiness (NPS) are often correlated with retention but don't cause it. Focusing on these proxies wastes energy. Instead, identify the one specific event (e.g., a team sending 2,000 Slack messages) that causally leads to non-churn.
Related Insights
The true indicator of Product-Market Fit isn't how fast you can sign up new users, but how effectively you can retain them. High growth with high churn is a false signal that leads to a plateau, not compounding growth.
Reacting to churn is a losing battle. The secret is to identify the characteristics of your best customers—those who stay and are happy to pay. Then, channel all marketing and sales resources into acquiring more customers that fit this 'stayer' profile, effectively designing churn out of your funnel.
Everyone obsesses over Net Revenue Retention (NRR), but Gross Revenue Retention (GRR) is the real indicator of product health. GRR tells you if customers like your product enough to stay, period. A low GRR signals a core problem that expansion revenue in NRR might be masking.
The current AI hype cycle can create misleading top-of-funnel metrics. The only companies that will survive are those demonstrating strong, above-benchmark user and revenue retention. It has become the ultimate litmus test for whether a product provides real, lasting value beyond the initial curiosity.
Once you've identified the single event that causes retention, ruthlessly design your entire onboarding process to get every user to that milestone. Remove all friction and optional paths. The goal is to make it 'weird' for a customer *not* to reach that critical activation point.
Instead of optimizing for retention metrics, April's founders set an extremely high bar for their own use. By ensuring the product was reliable enough for their own critical tasks, like sending investor emails, they naturally built a product with strong user retention.
Successful onboarding isn't measured by feature adoption or usage metrics. It's about helping the customer accomplish the specific project they bought your product for. The goal is to get them to the point where they've solved their problem and would feel it's 'weird to churn,' solidifying retention.
Shift the post-sale mindset from 'how to keep them' to 'what specific event turns off their default intention to cancel.' The sale isn't the finish line; it's the starting line for actively preventing guaranteed churn.
When facing uncertainty across your entire GTM strategy, prioritize the foundational elements. Begin with the customer experience: decreasing time-to-value and increasing expansion (NRR). If you cannot retain and grow existing customers, acquiring new ones is a futile effort that only masks a deeper problem.
