The Hierarchy of Engagement

"If a user isn't doing this [core action], they're not really a user to the product. That's why the MAU thing doesn't really mean anything." — Sarah Tavel

What It Is

A three-level framework to gauge the quality of growth. It starts with completing the core action, moves to retention through accruing benefits, and culminates in virtuous loops where usage fuels further growth.

When To Use

• Defining your North Star Metric
• Debugging high churn despite high acquisition
• Evaluating product-market fit quality
• Prioritizing product roadmap

The Pyramid

                    ▲
                   /│\
                  / │ \
                 /  │  \      LEVEL 3: VIRTUOUS LOOPS
                /   │   \     User activity re-engages others
               /────┴────\    or improves the ecosystem
              /     │     \
             /      │      \  LEVEL 2: RETENTION
            /   ┌───┴───┐   \ • Accruing Benefits (gets better)
           /    │       │    \• Mounting Loss (hard to leave)
          /─────┴───────┴─────\
         /          │          \
        /           │           \ LEVEL 1: CORE ACTION
       /            │            \Users complete the ONE action
      /─────────────┴─────────────\that defines the product
     ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━

Core Principles

Level 1: Grow Engaged Users

Focus on users who complete the Core Action (e.g., Pinning on Pinterest), not just visitors or app openers.

Level 2: Retain Through Value Lock-In

• Accruing Benefits: Product gets better with use
• Mounting Loss: Leaving means losing accumulated value

Level 3: Self-Perpetuating Loops

User activity (kinetic energy) re-engages other users or improves the ecosystem.

How To Apply

STEP 1: Identify Your Core Action
└── What ONE behavior correlates with retention?
└── Not opens, not signups—the VALUE action

STEP 2: Measure Core Action Completion
└── Replace MAU with "Users Who Did X"
└── This is your true North Star

STEP 3: Build Accruing Benefits
└── How does the product get better with use?
└── More data? More connections? More content?

STEP 4: Create Mounting Loss
└── What would users lose if they left?
└── History, reputation, network, content?

STEP 5: Engineer Virtuous Loops
└── How does one user's activity benefit others?
└── Create flywheel from usage to growth

Common Mistakes

❌ Confusing "Active Users" (opening app) with "Engaged Users" (core action)

❌ Optimizing for downloads or signups instead of core action completion

❌ No mounting loss = easy churn even with good product

Real-World Example

Pinterest realized "Pinning" was their core action, not clicking or following. Evernote creates retention because the more notes you store, the harder it is to leave (mounting loss).

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Source: Sarah Tavel, General Partner at Benchmark, Lenny's Podcast