Understanding User Retention

Jan 10, 2025

The theory of user retention revolves around keeping users engaged and bringing them back to platforms they’ve used, ensuring that they don’t churn (leave permanently). Companies in Web2 and Web3 alike employ several strategies to retain users, often leveraging communication channels like push notifications, emails, and SMS to achieve this. Let’s break down the strategies and how they can be adapted for Swift Protocol, focusing on on-chain to off-chain communication.

Understanding User Retention

Retention is based on two key principles:

  1. Timely Engagement: Reaching users at the right time with the right message.

  2. Value Alignment: Showing users why they should return, typically by reminding them of the platform’s value or nudging them to take action.

In Web2, platforms like Amazon, Facebook, and Duolingo excel at retention by maintaining an open line of communication with users via:

  • Push Notifications for immediacy.

  • Email Campaigns for detailed, actionable content.

  • SMS Alerts for urgency or real-time updates.

For Swift Protocol, these communication forms must adapt to on-chain realities: encrypted identities, decentralized data, and user-controlled preferences.

Web2 Strategies to Replicate

Here’s how successful companies leverage communication and how Swift Protocol can integrate these concepts:

Push Notifications: Immediacy

Web2 Example:

  • Amazon sends push notifications about abandoned carts or limited-time deals.

  • Duolingo nudges users daily with, “You’re about to lose your streak!”

For Swift Protocol:

  • Push can remind users of critical events like DeFi liquidation risks or upcoming staking reward claims.

  • Example Notification: “🚨 Action Needed: Your collateral is at risk of liquidation! Resolve now to protect your assets.”

Key Retention Mechanism: Push notifications create a sense of urgency and habit-building by consistently prompting users to act.

Email Campaigns: Detailed and Contextual

Web2 Example:

  • Spotify sends “Your Year in Music” emails, highlighting stats personalized to the user.

  • LinkedIn emails users when they receive profile views, driving them back to the platform.

For Swift Protocol:

  • Use email for detailed updates like governance proposals, transaction summaries, or staking yield overviews.

  • Example Email:

    • Subject Line: “Your Weekly Governance Update: 2 Proposals Need Your Vote!”

    • Body: Include summaries of proposals with links to vote directly.

Key Retention Mechanism: Email provides users with a record of platform activity and a reason to return, making it the best tool for in-depth engagement.

SMS Alerts: Urgency

Web2 Example:

  • Banks use SMS for fraudulent transaction alerts or login attempts.

  • Ride-sharing apps like Uber send trip updates via SMS to keep users informed in real-time.

For Swift Protocol:

  • SMS is perfect for high-priority events like liquidations or wallet security breaches.

  • Example Alert: “⚠️ Your loan on [dApp] is at 90% collateral ratio. Add funds or repay now!”

Key Retention Mechanism: SMS has the highest open rate (~98%) and is ideal for critical messages that demand immediate attention.

Challenges in Web3 Communication

Traditional methods are easy in Web2, but they hit roadblocks in Web3 due to:

  1. On-Chain Identities: Users don’t share emails or phone numbers by default; their identities are tied to wallet addresses.

  2. Privacy Concerns: Users value anonymity and often avoid sharing personal data.

  3. Decentralization: Without a central authority, reaching users off-chain is harder.

How Swift Protocol Solves These Issues

Swift Protocol bridges the gap by:

  1. Encrypted Data Storage:

    • Users share contact details (email/phone) encrypted with Swift’s system, ensuring they remain private and tamper-proof.

    • No plaintext storage on servers, alleviating privacy concerns.

      {
  "app": 1, // The application ID
  "methods": ["email", "push"]
}

  2. User-Controlled Preferences:

    • Users can choose which dApps can send notifications, and via which channels (Push, Email, SMS).

    • Example Flow:

      1. User authorizes their email for DeFi notifications.

      2. Swift stores the encrypted email, allowing authorized dApps to send governance or staking updates.



  3. Seamless On-Chain Triggers:

    • Swift Protocol integrates with dApp APIs to detect specific on-chain events (like a wallet activity or governance vote deadline).

    • These events trigger notifications across channels.

User Retention Strategies for Swift

(Group 1)

1. Habit-Forming Engagement

  • Focus: Encouraging daily/weekly interactions through push notifications.

  • Example:
    “💰 Your staking rewards for [Protocol Name] are ready! Tap here to collect them.”

2. Milestone Celebrations

  • Focus: Rewarding user achievements via personalized emails.

  • Example:
    “🎉 Congrats! You’ve earned 10% APY on your staked assets this month!”

Dashboard Utility:

  • These strategies can be visualized through Home Dashboard analytics:

    • Notifications Sent.

    • Conversion Rates for Push and Email Campaigns.

    • User Activity Trends.

(Group 2)

3. Action-Oriented Alerts

  • Focus: Escalating urgent updates via SMS to ensure immediate attention.

  • Example:
    “⚠️ URGENT: Your collateral for [Protocol Name] is at risk. Add funds now to avoid liquidation!”

Dashboard Utility:

(Group 3)

4. Personalized Content

  • Focus: Tailored communication to individual users via email or dashboard summaries.

  • Example:
    “Hi [User]! Here’s your weekly summary:

    • Governance Votes Cast: 3

    • Rewards Earned: $500

    • Pending Proposals: 2”

5. Re-Engagement Campaigns

  • Focus: Nudging inactive users back with targeted campaigns.

  • Example:
    “🔔 We miss you! New DeFi opportunities are waiting for your wallet balance.”

Dashboard Utility:

  • Use the Newsletter Section to:

    • Segment user groups based on activity.

    • Customize re-engagement campaigns to dormant users.

    • Measure success rates for personalized outreach.

Analytics Overview (Grouped for Admin Tools)

Home Dashboard:

  • Displays metrics for all groups, including:

Settings Page:

  • Central hub for:


Future Communication Innovations for Swift

  1. On-Chain Governance Updates:

    • Automatically notify users of new proposals and voting deadlines based on their activity.

  2. Dynamic Notification Escalation:

    • Start with a push notification and escalate to SMS if the user doesn’t act within a set time.

  3. Cross-Chain Notifications:

    • Notify users about activities across multiple blockchains (e.g., staking on Cosmos and voting on Ethereum).

To succeed in Web3, dApps need to prioritize user communication and retention. By integrating Swift Protocol’s Push, Email, and SMS capabilities, projects can emulate the retention strategies of Web2 while staying aligned with the decentralized ethos of Web3.

Swift doesn’t just send notifications—it ensures that users are informed, engaged, and in control. This is how we move Web3 from fragmented communication to seamless, privacy-first user experiences. The future of decentralized retention starts here.

An overview of Swift encryption protocols ›