If you’re a business owner, chances are you’ve heard the term “DAU” thrown around. But what is DAU? In this blog post, we’ll explain everything you need to know about DAU and how to calculate it for your business.
I remember when I first started my business, I had no idea what is DAU. My team would talk about it all the time and I just nodded along pretending like I knew what they were talking about. Eventually, I realized that if I wanted to be an effective leader, I needed to understand what DAU was and how to calculate it.
Since then, calculating DAU has become one of my favorite things to do because it gives me a clear picture of how our app is performing daily. Not only that but understanding your Daily Active Users is critical for making informed decisions about your product roadmap and marketing efforts
What Is DAU?
In computing, DAU or Daily Active User is a common metric for the level of engagement of a product or service. It represents the number of unique users who use the product or service on any given day.
This metric is used to measure the health of a product or service and to track user engagement over time.
There are a few other ways to calculate the periodic use of your site or app, some of which may be more accurate than using DAU alone. These include methods such as active user count (AUC) and monthly active users (MAU).
Next, we’ll look at why Daily Active Users (DAU) is such an important metric to track.
How DAU works
1. It Counts Relevant Users
The number of unique users who visit a website or use an app each day.
To be considered an active user, one must take some action on a website or app. Simply viewing a site is not enough.
But different companies have different definitions of interaction. For example, let’s take a gaming website. The user would have to actually play the game to be counted as active. This is different from a social media website, where simply logging in would be considered an active user.
2. It Measures Success
Many businesses see DAU, or Daily Active Users, as a measurement of success. A product or website is considered “sticky” if a high number of users choose to interact with the product daily. This metric can help gauge whether users find your product useful and engaging.
The main issue with DAU is that companies calculate it differently internally. Even a small variation in what a company considers an active user can result in big changes to the results.
Some people believe that DAU is not always indicative of a company or product’s success.
3. It Is Used in Other Calculations
DAU is used to calculate MAU — or monthly active users. This number is also used to show a company’s growth or popularity.
MAU will vary greatly depending on the company’s definition of DAU.
Why DAU matters
1. It’s a Popular Metric
DAU is a popular metric used by technology experts and investors to measure both the popularity and the potential for growth of an online platform or app.
In other words, how many users find the website or app useful enough to access it daily?
That is what DAU measures.
2. It’s Useful in Context
Taken at a single point, DAU can be misleading. As we discussed above, a company’s definition has a lot to do with the numerical value of DAU.
Measuring the change in DAU can be a lot more revealing. If a DAU is continually increasing at a fast rate, that is an indication the app or website is gaining popularity and success.
3. It’s One Metric of Many
DAU is an important component in a company’s arsenal of metrics. But it cannot be the only one.
If a company focuses just on DAU but fails to notice other signs of doom, they could go down seemingly without warning.
A company needs to keep an eye on new subscribers, in-app purchases, reviews, and more — anything that could indicate a problem.
DAU, taken with these other metrics, can help a company keep tabs on its success or need for change.
How to Calculate Daily Active Users
“Active user” is a rather broad term. You will have to define your very own set of credentials that qualify as an active user before you calculate DAU.
But you also need to define what a user is. Most SaaS companies will call a user a unique visitor who has logged into the platform (whether desktop or mobile app).
Different platforms have different purposes.
For an email marketing platform, it may be the act of creating an email, for a business insights platform it may be pulling a report and creating a visualization, and for a social media platform, it might be creating or liking a post.
These actions need to be consistent to measure your data correctly.
So how do we calculate daily active users?
Daily active users are calculated using the total number of unique users on a given day.
Within DAU, there are new users and returning users—together, they equal the total DAU. They both separately allow a window for the product team to look into and measure how fast the platform is attracting new users and keep them coming back.
Now, this can be different depending on the functionality of the platform and the access that is granted to users. Slack is a great example of a company that keeps a very close eye on its DAU.
There is no technical formula for DAU, as many analytics tools can easily show you your daily active users.
If you only have monthly traffic or usage data, you can take the total number of unique visitors (users) and divide it by the days in the month.
For example, if you have 2,600 unique monthly sessions in April, divide that by 30 (days in the month) and you have around 87 active users.
What is DAU? Daily Active Users is a critical metric for any business owner to understand. It gives you a clear picture of how your app is performing daily and helps you make informed decisions about your product roadmap and marketing efforts. If you’re not already calculating DAU, I encourage you to start today!