As a business operator, you're always looking for ways to measure the success of your product or service. You need to keep track of the key performance indicators (KPIs) to help you assess whether your business is meeting its objectives and goals.
One such KPI is Monthly Active Users (MAUs). MAUs are particularly relevant for SaaS teams, marketers, and analysts trying to measure the popularity and effectiveness of their digital platforms and services.
But what are MAUs exactly? We’ve got you covered!
In this article, we'll explore MAUs, why they're essential, and how to calculate them accurately to help improve the growth and success of your business.
Understanding Monthly Active Users
Monthly active users are a metric used to measure the number of unique individuals who engage with a particular product, service, or platform within a specific month. This SaaS metric counts a digital product's popularity, reach, and user engagement.
This metric monitors user logins, sessions, or other predefined engagement indicators, allowing businesses to effectively measure their product's user base and evaluate its growth or decline over time.
It goes beyond measuring mere downloads or installations. It focuses on actual user engagement, highlighting the number of users interacting with the product or service regularly.
Knowing the number of MAUs gives businesses insights into how engaged their users are and how well they retain them over time. If a product has many MAUs, many users engage with it and return for more.
MAUs also help businesses identify trends, patterns, and user behavior on their platform. Businesses can optimize the user experience and improve engagement by analyzing this data, leading to more revenue and growth.
Who Uses Monthly Active Users and How?
MAUs are widely used by different industries, especially for digital products such as software as a service (SaaS) solutions and social media platforms.
SaaS companies rely heavily on user engagement to drive revenue growth, and the MAU metric provides valuable insights into their digital products' performance.
This helps them identify areas where their product may need improvement, such as user onboarding, user experience, or feature development.
By tracking MAUs, SaaS companies can optimize their product to better meet their users' needs, thus generating greater income.
Social media companies like Meta and Tiktok use MAUs to measure user engagement and retention rates. These platforms use the metric to track the number of users who log in to their platform each month and interact with their content.
For Meta, an MAU should have engaged with their platforms, i.e., Facebook, Messenger, or Instagram, via the website or mobile application within 30 days.
However, things are different when it comes to Twitter. Before being acquired by Elon Musk and rebranded as X Corp, Twitter used to track monthly active users. They've since shifted their focus to "monetized daily active users" or mDAU.
In Twitter's definition, mDAU refers to individuals who consume the platform in a manner that enables the company to present them with ads.
How Do You Calculate MAUs?
To calculate monthly active users, you need to define what you mean by "active." This definition can vary depending on the product or service being measured, but generally, it refers to meaningful engagement with the product or service.
For example, an active user on a social media platform could be someone who logs in, posts, likes, or comments within the month. On the other hand, an active user of a gaming app could be someone who plays the game or engages with its features.
Then, measure the number of users that meet that definition. You can do this using analytic tools or by querying your database to count the unique users engaged with your product.
Filter the collected data to identify unique users who engaged with your product or service within the month. This step ensures that each user is counted only once, regardless of the number of interactions they had during that period.
MAUs can be tricky to calculate, as several factors can impact the accuracy of the metric. For example, if multiple people use your product or service on the same device, you may need to account for that to avoid overcounting.
Establish a consistent reporting period and methodology when calculating MAUs to ensure accurate and comparable data analysis for your company over time.
Advantages of Using MAUs as a KPI
There are several benefits to using MAUs to measure user engagement and retention, and we'll explore three of them in detail.
Easy to calculate and understand
One of the primary advantages of using MAUs as a KPI is that it’s easy to calculate and understand. Unlike more complex metrics such as customer lifetime value or net promoter score, MAUs require only basic