(This is an excerpt from my latest book on Rapid App Store Optimization and Marketing, coming out on 30th of July, 2019)
Retention is probably the single most important metric, other than revenue. It is represented as the percentage of users still using your app a certain amount of time after they installed it, for example R7 = 30% (Of all the people that installed your app. 30% of them are still using it 7 days after they installed it)
App retention drops drastically after Day 1, that’s normal. The million dollar question is: does your retention curve flatten out and at what point? See the top app retention above.
There is no golden rule for what the number should be. It depends on your industry, platform (iOS / Android), country, business model, etc. Social networks need to have higher Day 7 retention. If you don’t open a social network at least once a week, you’re not being very social. Where as a marketplace can have a fairly low day 30 retention. Somebody can come to an ecommerce app once a month and buy $300 worth of products, that’s pretty good.
If you do a bit of Googling you can figure out what’s a good retention in your vertical. The following graph from Mixpanel will give you some rough idea one Day 30 retention. But do your own research.