Why has the 7-day retention rate for new users in the Luno app dropped by 15% over the past month?

Introduction

The recent 15% drop in 7-day retention rate for new Luno app users is a critical issue that demands immediate attention. This metric is a key indicator of user engagement and product-market fit, directly impacting our long-term growth and success. To address this problem, I'll employ a systematic approach to identify, validate, and resolve the root cause while considering both short-term fixes and long-term strategic implications.

Step 1

Clarifying Questions (3 minutes)

• Looking at the timing, I'm thinking there might be a recent app update. Has there been any significant changes to the app in the past month?

Why it matters: Recent changes could directly impact user experience and retention. Expected answer: Yes, there was a major UI overhaul. Impact on approach: If confirmed, we'd focus on analyzing the new UI's impact on user behavior.

• Considering user segments, I'm curious about the distribution of this drop. Is the 15% decrease uniform across all user segments or concentrated in specific groups?

Why it matters: Helps identify if the issue is global or specific to certain user types. Expected answer: The drop is more pronounced among new users aged 18-25. Impact on approach: We'd investigate factors specifically affecting this age group's engagement.

• Thinking about external factors, have there been any significant changes in the cryptocurrency market in the past month?

Why it matters: Market volatility can greatly influence user behavior in financial apps. Expected answer: There's been a 20% drop in Bitcoin value. Impact on approach: We'd need to consider how market conditions are affecting user engagement.

• Regarding data integrity, has there been any change in how we measure or calculate the 7-day retention rate?

Why it matters: Ensures we're comparing apples to apples in our analysis. Expected answer: No changes in measurement methodology. Impact on approach: Confirms the issue is with user behavior, not data collection.