STEEM Churn Rates Q3 Report
Repository
https://github.com/steemit/condenser
Overview
Churn is a fact of life in business. You will win new users and you will lose users. Churn measures how many users you are losing. Whereas retention measures how many users you are keeping. Churn can be calculated by the following formula
Churn = Number of Active users at the beginning of the period + New registrations – Number of Active users at the end of the period.
Churn rate can be calculated using
Churn rate = Churn / Number of Active users at the beginning of the period.
A high churn rate on a social media/networking site would indicate low engagement lack of loyalty and high dissatisfaction. To give us some sort of base to use as a benchmark for STEEM, I have taken this chart from vertoanalytics.com
Aim of Analysis
The aim of this analysis is to calculated the churn rate on STEEM as a social networking type blockchain* for Q3 of 2018 and compare this to the rest of the year. You can view the Q2 Churn report here
https://steemit.com/steem/@paulag/steemit-monthy-churn-rate-drops-to-35
*STEEM is not only used a as a social networking type blockchain. Some people are investors and wallet holders only. Previous analysis have shown this makes up less than 0.5% of accounts on STEEM and so no adjustment has been made as I have deemed it immaterial.
All data for this analysis was taken from Steemsql held and managed by @arcange. As to not distract from the data, I will first present the findings and then the queries used.
Weekly Churn Q3
The table above shows the number of new accounts registered per week, the distinct count of votes, the discount of authors, the distinct user count (either voted or posted/commented), the weekly churn and the weekly churn rate.
The churn rate varies considerably from week to week as it is dependent on two variables. The distinct users and The number of new accounts. As both of these variables vary from week to week it is expected to see this variation reflected in the churn rates.
Below shows how this compares to previous reporting periods. We can see that the average weekly churn halved from Q2 to Q3.
Monthly Churn 2018
As with the weekly churn rates you would expect to see a variance on the monthly churn rates as the variable also change.
The monthly churn rate peaks in March at 71% and reduced to a low of 20% in August before rising again in September to 35%. It is worth noting here that HF20 took place in September and very well had an impact as the resource credits problem hit the last week of the month.
Quarterly Churn Rates
I think the chart speaks for its self.
Using this as a comparative figure against the social media sites in the image above. Facebook was reporting a churn rate Q3 to Q4 of only 2.8%, Snapchat 23.5%, Instagram 19.1%, Twitter 25.3% and Kick 33%.
Conclusion
Churn is a fact of any business. What is an acceptable level of churn is also a business choice but the reality is, the lower this number the better. We had a Q1 churn rate of 121% was very disappointing to see. 52% qtr churn is such a massive improvement.
The drop in new users from Q2 to Q3 of 49% had the biggest impact on this reduction in churn as the drop in distinct new users was only 18% for the same period. However Q3 figures could be slightly skewed due to HF 20 as previously mentioned.
What are your thoughts on the churn rates above? What reflection do they give about Steem? Please do comment below
Personal Opinion
In my last report I shared my personal thoughts on this data. Something I don't normally do. However retention and churn are close to my heart and something I have been working towards improving with different initiatives and communities. From a witness standpoint @steemcommunity works hard towards improving retention, with manual curation from the @c-squared team, engagement leagues from @abh12345 and the power up leagues ran by myself and the witness (@Steemcommunity) account. Looks like our active work is paying off.
I have shared data before proving increased retention amount users of Ashers league and often feature data posts on communities showing the same. There is a massive amount of people to thank for this reduction in churn. People like @wolfhart @davemccoy and the @pifc team, @meno and the @helpie team ,@aggroed and MSP team, @janton for talking to anyone that will talk back, the @dustsweeper team, the @welcomewagon team, all the projects working on helping redfish, wow I could go on and on. @steemcommunity witness account supports as many community accounts as possible by way of votes to show our support for what you are doing.
The work all of these projects and people have been doing has gone relatively unnoticed and thanked. I have even see some people say who gives a fuck about the retention and I am here to strongly defend the need to have improved retention and churn.
We all know Steemit.com was a beta UI for the STEEM blockchain. A launchpad for greater things. We all know that Steemit Incs main focus is the blockchain and not the UI. I also fully understand and agree that the first few million users on something that could have a few hundred million are not really a big deal. However for Steemit.com to be a successful launchpad for greater things it needs to prove the concept works. Extremely high churn by no means helps this and makes steemit.com useless as a marking tool for the STEEM blockchain and SMT's.
It is also well known that the initial distribution of STEEM makes the blockchain rather centralized. Due to this centralization, when Steemit had a wave of new users for the second half of 2017, there were too few active accounts spreading to spread out the distribution of new coins to a wider base.
Now new account creation is rather low compared to 9 months ago. In Sept we had 109K unique active accounts of which a vast majority is bots. Now is the time to focus on and grow the humans here. Because these will be the base for the next wave, a larger base to spread the rewards. A large base to promote a positive sentiment of STEEM, a larger base to help provide initial traffic and launchpad for DApps to succeed.
Personally I feel the current churn rates are perfect. If we can maintain these levels and grow the accounts we have the STEEM blockchain and SMT's will have an improved chance of success. The next question is, how can we accelerate the growth of accounts while we have this lull to take advantage of?????
The Queries
As mentioned I used Steemsql and PowerBI to gather and model the data. The query used to get the unique voters was
SELECT voter, timestamp FROM Txvotes (NOLOCK) where timestamp >= CONVERT(DATE,'2018-07-01') and timestamp< CONVERT(DATE,'2018-10-01')The query used to get the unique authors was
SELECT author, timestamp FROM Txcomments (NOLOCK) where timestamp >= CONVERT(DATE,'2018-07-01') and timestamp< CONVERT(DATE,'2018-10-01')To get the total unique users, I combined both of the above queries and then ran distinct counts on the name.The query used to get the number of new accounts was
Select name, created FROM Accounts (NOLOCK)
Hi @paulag, very interesting follow-up to the Q2 report! While the new registration counts continue to decrease over time, the churn rate seems to follow this trend - which is not too bad if I understood it correctly?! I must admit, I was also a bit puzzled if the churn rate can be negative. Given your definition, it makes sense if previously inactive accounts are reactivated. Do you have insights how the churn rate is calculated for the other social networks? They must have the same effects somehow. But what I'm unsure about: does it make sense to add new accounts unconditionally to the churn or should only those be included that are actually "active"? I've seen definitions of the churn rate as
(active_users_at_the_beginning - active_users_at_the_end) / active_users_at_the_beginning. I think this could treat inactive new accounts more accurately?Your contribution has been evaluated according to Utopian policies and guidelines, as well as a predefined set of questions pertaining to the category.
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hay @crokkon and thanks for the review and feedback.
I did use (active_users_at_the_beginning - active_users_at_the_end) / active_users_at_the_beginning to calculate the churn
"Churn = Number of Active users at the beginning of the period + New registrations – Number of Active users at the end of the period.
Churn rate can be calculated using
Churn rate = Churn / Number of Active users at the beginning of the period."
The problem with the weekly and negative churn is down to steemit inc not creating accounts at the same pace each week. the variance on the week to week is to much to make sense really.
Thank you for your review, @crokkon!
So far this week you've reviewed 3 contributions. Keep up the good work!
Thank you for all the analysis ✅ It will be really interesting to see the influence of HF 20 in another one or two month... Hoping the best 😊 @peekbit
According to @themarkymark (link below), there is between 8,000 and 12,000 active, real users.
From a project of over two years online - I find it hard to see the positive evidence in the 'progress' of steemit....(as the social platform).
10, 000 real users in 2 years !!!!
https://steemit.com/utopian-io/@themarkymark/did-hf20-reduce-or-increase-usage
well you can see the glass half empty or half full... the platform is in very early stages. The active users may not be what you'd like to see .. but the fact there are active users means there is still life. Since HF 20 as curator, I'm seeing less spam and more real posting. That is a bonus and gives us something to build on.
It's not about seeing it as ' half full ' (or 'empty '.)
I'm being objective.
if the active users are , say 10,000 - after 2 years - on a social media platform - I fail to see how a perspective of 'half full' regarding users is not bordering on willful delusion.
It's a crap stat for a 2 year old media platform, Imo.
I want to see it grow (screw facebook) - but facing reality is not a bad thing and calling it as it is.
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I hate facebook - but still doesn't change the numbers..
hf20 does seem to have reduced spamming, which is cool.
Well if it was a two your old media platform in the mainstream/fiat world, I'd totally agree. Facebook, which is a lousy comparison source actually IMO, came into a market that already had some platforms doing similar.
STEEM however is paving the way in the crypto world for this sort of platform. It's not easily understood in either the crypto or the fiat world thus is taking time not only finding its way but attracting people who are willing to hang in for the ride.
In my two+ years on the platform I've watched a lot come and go. The most common reason is arriving with expectations of making lots of money. An expectation Facebook doesn't have to contend with. Some left because they didn't want to contend with the spam ... some left because they were spammers which is a good thing.
So, yeah, on the surface having 10k active seems to suck ... however when i look at what this platform is, where it has come from and where it can go ... I'd rather 10k active and engaged users than 1million doubters.
So, yes, it's going to be a long and possible slow growth .. but it will come. This is a marathon not a sprint
I came with the earn some money expectation - I soon changed that perspective. lol
Don't get me wrong, I'm here for the long haul. (I missed less than 5 days posting in over a year, I recon).
I agree with facebook not being comparable - I was pointing out numbers.
But I still stand by my point. It's a crap stat!
lol
I understand you frustrations but there is a major expectations gap when users come to steem. People are under the belief they will make a tidy income for very little work and when they see thats not true, many tend to leave. the dymanics of steem make it impossible to do a facebook. The distribution was all wrong to start with and when you only have a couple of hundred people spreading the rewards as we did when the wave hit last year it only aided with the negative sentiment and high churn. If people came to social network and there were no rewards ever mentioned, the expectations gap would not be a problem.
I agree with @themarkymark post however that is based on 7 days. I know many account holders that visit steem and would post 3-4 times in a week and then not post again for another 4-6 weeks. My estimations on 1 account 1 human is circa 45K. Okay that's still rather poor out of 1m.
There is also a much bigger picture than steemit.com. You have not seen much progress in steemit as a social platform because the focus has been on the blockchain. Such a pity that the awesome people working directly on the block improving churn from over 100% to just over 50% is seen as not much progress.
...I'm just being pragmatic, not negative....If the stat is correct - It's still crap.
And, pray tell, who created that expectation?
That would be Steemit Inc. who has, from day one, promoted Steemit itself and the steem blockchain as a place where you can come and get rewards for blogging/social networking. In fact, the underlying assumption that is and should be the case underlies a lot of your rah rah here because there's a lot of discussion of increasing the value of STEEM and not a lot about why people might want to be involved in active in the social network ecology.
Looking at the numbers is, and has been for quite some time, terribly revealing. People don't.
This is correct. Rather than focus on the things that actually sets this blockchain apart from others and provides actual value to the commodity which STEEM represents, the focus has been on blockchain technology that doesn't facilitate getting more people involved or which is poorly designed to get more people involved (as we see in hardfork 20).
That's a real problem.
@themarkymark points out the necessarily obvious, in that we need to define what we think of as "active." I would further point out that we need to talk about and define what kind of activity is sufficient, because we don't know what percentage of those 45 K active accounts are bots that made one throwaway post or comment and then fell silent again.
The bots are the obvious problem for looking at churn and seeing a reduction, even if your numbers were accurate, as a positive. After all, if the number of bots getting new accounts outnumbered humans a thousand to one and each of those bots made a throwaway comment post and then did nothing else but hold money, the rate of churn would fall drastically. By any definition.
In an environment and ecology like this, churn is not a useful indicator – which is why in my previous reply I focused on "what is it supposed to mean."
Reducing it by half may just mean that we doubled the number of bots which sell votes and post spam.
"That would be Steemit Inc. who has, from day one, promoted Steemit itself and the steem blockchain as a place where you can come and get rewards for blogging/social networking."
I can not disagree with this statement at all.
So true. The expectations should be set on distributed social media away from algorithmic control or censorship. As an active influencer on IG and watching the algorithm cut my reach in half over the past month while requesting I promote my posts this is the main advantage here.
Thank you very much for this information @paulag... And also thank you also for everything you do to try and help this community build and grow! I know everyone's not always as hopeful and optimistic, so its nice to see you get the facts out there and then give us your opinions too. Have a wonderful day :)
I cant help be optimistic when I have been looking at this churn rate drop month after month.
Great summary and analysis! I think that as the price and market overall start to stabilize we will see improvements in churn. I think it will also signal an improvement in overall engagement as those who stay provide more value to the ecosystem. While still early, I think the HF20 impact will have a “knee-jerk” reaction where churn will increase but subsequently decrease as communities start to onboard their own users and create innovative ways to retain them and keep them engaged through RC delegation pools and/or SMT being developed.
I am looking forward to seeing communities on boarding and SMT's. everything will become so much more focused then.
Great Article - I agree that there are too many Bots on this platform. Humans are coming but it is a slow process. The next wave will make this platform very strong - the trigger?? - People can actually make money from blogging here...What a fantastic Medium!!
"People can actually make money from blogging here"
This idea also causes an expectations gap between what people think they will make and what really happens. the rewards need to be secondary.
Yes I totally agree, but it is a bonus and incentive some people need to get started.
Hey @paulag - Thanks for the wonderful analysis. From my experience with businesses, as you said, churn has always been a fact of life. There is no way to fulfill the needs of all of the users in one simple platform.
I'm not sure how to access the data within STEEM, but maybe what we can start to do is to do cohort analyses. See if recent cohorts have drop-offs in activity at a much more accelerated pace. If not, I would say STEEM is here to stay! Also, it would be pretty cool to confirm whether or not price really does have an impact on churn (my logic says it is, but I don't have the concrete evidence to support this). I always say that this is the time to take advantage of the opportunity!
I use steemsql to access the data and if you want, I can get you some raw data to play around with. There is a correlation with the users and the price of steem, but there is also a correlation between the price of steem and the general crypto sentiment.
Tried accessing the SQL database, but it's apparently a subscription model now. I'll have a look later and hopefully do some cohort analyses with your information! Thanks again for your help!
@paulag, In my opinion this is really effective Analysis and it's vital too because in this way we can understand, how many new users are entering into the Steem Economy and staying for long term and this understanding can gain by the Retention data. And i strongly believe that in future we will going to see more exciting opportunities in Steem Economy specially when we talk about the SMT's and then the User Activity will going to touch the moon height.
Wishing you an great day and stay blessed. 🙂
hay @chireerocks and thanks for the comment. The future is bright. Steem on.
Welcome and that's true. 🙂
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Great work @paulag . I always use your stats to check how ell the steem community is doing.
Keep dropping awesome content
Hi @destinysaid and thanks for the feedback. I so love when the stats are as positive as this. We are in an amazing position right now but we need to get everyone working together now to reach the next stage.