DAU / MAU is known as the stickiness ratio because it measures the number of days per month users engage with a product or service. 75% DAU/MAU score means users engage with the app for 75% in a month. The DAU/MAU Ratio of most companies is usually around 10% to 25% however there are outliers like WhatsApp and other messaging apps with a ratio of 50% and upwards - which is the holy grail for SaaS.
If there are 400 daily active users and 1,000 monthly active users x 100 would give me a 40% DAU / MAU Ratio meaning only 40% of my users use the app daily in a month.
This is the most important metric to understand how many users become dedicated, repeat users. For apps with consumption based pricing models or a set and forget value prop, this ratio will be more limited in the value it provides because user’s don’t need to log in and engage with the app everyday to get value. The DAU/MAU Ratio is especially useful to measure stickiness or retention across multiple quarters.
Quite often product teams struggle to match a qualitative understanding of swings in performance as macro trends. Seasonality, the work week, and other important situational and behavioral context is missing from an otherwise thorough understanding of when a number of clicks occur. Especially when an alchemy of unrelated features get launched with adverse effects, it often takes a qualitative understanding earned through user research to excavate and examine what went wrong and how to remediate issues. If product experimentation and research is having a positive impact on business outcomes, the gap between DAU and MAU should close incrementally quarter over quarter.