Jared Zhao
CEO
Good retention fuels strong lifetime value (LTV) and gives you the confidence to invest heavily in growth. Bad retention, on the other hand, is a sign of a leaky bucket—a SaaS startup’s worst nightmare.
"Before Athenic AI, our customer analysis was a tangle of static reports and guesswork. Now, I can instantly slice our cohorts by payment plan type, onboarding experience, or feature usage—and understand differences in engagement and LTV. It's completely transforming how we prioritize our roadmap and uncover high-LTV segments. Athenic AI lets us build with clarity, not assumptions."
Rachel Hechter, Head of Product at
PhoneBurner
In the rest of this article, we’ll explore how to do Cohort Retention analysis using the data that you’ve already been collecting since the earliest days of your product.
Tracking retention goes far beyond vanity metrics like signups or website traffic.
Product Health—High churn or declining retention often points to issues with usability, onboarding, or core value. Segmenting by how far customers made it in your product can pinpoint where to improve.
Customer Lifetime Value (LTV)—Strong retention boosts LTV, letting you spend more to acquire customers and scale faster.
Cohort Retention measures retention over time, grouped by the period a customer started (a “cohort”). Grouping by cohort enables you to evaluate retention as it changes, allowing you to see if you’re moving in the right direction.
"Retention is a measure of the people who tried your product and liked it enough to return; as such, it underpins all significant metrics."
Sequoia Capital
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Sequoia Capital’s article about Retention gives a great overview of how retention applies to SaaS startups. Come back here to learn how to apply retention analysis in practice.
To improve retention, you need to understand what sets your best customers apart. Segmenting users by attributes like acquisition channel, persona, or product usage reveals where value is created—or lost.
Take Uber: do riders stick after their first trip, or after several? What patterns drive loyalty? Segmentation helps you prioritize features, target valuable users, and align your team around faster growth.
"A product might have excellent retention overall, while retention of its messaging and image-upload features is significantly lower. Wide variations are not uncommon between individual features. To ensure your product reaches its full potential, you should recognize this reality and analyze the retention of individual features as well as of the product itself."
Sequoia Capital
Building a Cohort Retention chart manually is tedious. At Athenic AI, we’ve built it into the product—combining the flexibility of AI while ensuring the cohort calculations are accurate. Once setup, you can explore customer segments just by asking questions:
Retention of Athenic AI users is much stronger after connecting a live data source, as opposed to CSV or Google Sheets:
Takeaways:
CSV and Google Sheets are fine for quick testing but don't deliver lasting value. We should consider replacing them with a fully set-up sample data source to guide users faster.
Connecting a live data source should be frictionless. Add options like booking support directly from the connection page, extending free trials, or offering incentives to encourage it.
The “Aha” moment for new Athenic AI users probably happens somewhere around 15 questions mark:
Takeaways:
We need to incentivize new users to ask more questions as quickly as possible.
If it takes 15+ questions to reach the "Aha" moment, users likely aren’t understanding the product early enough. We should:
Make asking questions more intuitive
Teach users how to ask questions inside the product (e.g., a guided walkthrough)
Improve product documentation
Now that you’ve seen why measuring Cohort Retention is valuable, and how easy it is to do this with Athenic AI, let’s set it up for your own data.
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If you have any questions, you can reach out to support@athenic.com for help.
Connect your application database
Athenic AI connects to your application database, which is your most complete source of user activity and feature usage. This allows you to analyze all of your historical data, rather than having to record user activity separately.
Identify the User and Action:
User: The unit you’re measuring retention for (e.g., Uber → riders; Athenic AI → Teams). Usually it’s whoever is billed, but sometimes it’s another entity.
Action: the main way users get value (e.g., Uber → rides completed; Athenic AI → questions asked).
Identify Customer Segments
To get the most from retention analysis, you need to find what separates your best-retained users from the rest. Adding segmentation data in Athenic AI lets you compare retention across different user behaviors.
For example, we looked at retention by data source type, projects created, team size, and number of questions asked. We added minimal supporting datasets to our Knowledge Graph to compare users with live vs. static data sources, and those who asked 1 vs. 15+ questions.
Create Cohort Retention Charts
Now, we’re ready to start creating our Cohort Retention charts. The best way to format your questions is:
“Show me a {time period} cohort retention of {user} doing {action},
{how you want to segment the users}“.
For example, we’ll ask: “Show me the monthly cohort retention of teams asking questions”
🎉 Congratulations! You’ve created your own Cohort Retention chart!
"Exposing users to your product’s magical moment as early and as frequently as possible will reinforce your product’s value proposition and drive them to return to the product, as well as to engage more deeply and more frequently. This will first increase short-term retention and later manifest in better long-term retention, putting your product on the road to sustainable growth."
Sequoia Capital
Retention analysis isn’t just another metric — it’s the clearest blueprint for building a product users can’t live without. By deeply understanding cohort retention and segmenting precisely, you uncover where your product truly delivers value — and where it falls short.
The insights uncovered through cohort retention empower you to create "Aha!" moments earlier and more frequently, driving your customers towards lasting engagement. Keep listening closely to your retention data—it has the power to guide you toward the product your customers can't imagine living without.
Book a demo to get started.
