Products on average retain 30% of customers after 3 months: Product benchmark findings

User retention is an important metric for determining a product's success. Our recent benchmarking report has shed some light on patterns in user retention across various industries and company sizes. Let’s dive right into what our data has told us. 

Our analysis reveals that products, on average, manage to retain 38.8% of their users after the first month of use. This figure dips slightly to about 30% after three months, indicating a gradual but persistent user drop-off. For example, for every 100 active users a product acquires, only 30 will continue to use it after a quarter year.

The interpretation of these figures, however, isn't one-size-fits-all. For a fledgling product, a one-month retention rate of 38.8% could be seen as a positive sign, suggesting that the product is delivering value to a significant portion of its user base. Conversely, for an established product, this same rate might be a red flag, potentially indicating underlying functionality issues that need addressing.

It's worth noting, however, that the ‘best-in-class’ products outperform these averages. These top performers manage to retain 1.7 times as many customers in the first month compared to the average. This advantage grows over time, with 1.8 times and 1.9 times higher retention in the second and third months, respectively. For example, for the best companies, 66.6% of users are retained in month 1, 60.8% are retained in month 2, and 56.6% are retained in month 3. This widening gap underscores the compounding benefits of strong initial user engagement and satisfaction.

Manufacturing and Consumer Goods have the highest user retention Industry has a major impact on your product’s user retention. 

Manufacturing is in the lead, followed closely by Consumer Goods and Media. Products in the Financial and Government sectors are having the hardest time bringing customers back after one month. 

Our data also revealed that companies with fewer than 200 employees have higher user retention after months one and two,  on average. But after month three, large companies appear to triumph. After one month, small companies retain 40 customers for every 100. In month two, they retain 34. In month three, they maintain an average of 16.7 users.

On Mind the Product we’ve published a bunch of great content on how to retain users, from guest posts, to keynote sessions, to deep dives from us in the editorial team. You can have a read or a listen of some of our favourite pieces on this at the end of this post, however here are some of our top tips, based on advice from over the years. 

We measure user retention by counting new visitors, and if they returned in month one, two, and three after the month of their first visit. If a user first visits your product, we see if they return within 30 days (month one), 30 to 60 days (month two), or 60 to 90 days (month three).

We’ve explored anonymized data* from 6,800+ applications across 2,500 companies on the Pendo One platform. We've analyzed how products perform across nine strategic areas, breaking down each benchmark’s insights by region and industry. 

We categorize performance across four brackets: