Summary of Key Points
This article outlines the entire journey of DAU (Daily Active Users) from its inception, becoming a core metric in the internet industry, dominating for over a decade, to being challenged by the AI era: It was born out of mobile internet and advertising business models and became globally recognized after Facebook's public offering, evolving into a "hard currency" for capital to measure company value. However, during its dominance, it led to the creation of various tactics (such as push notifications and endless scrolling) to boost user activity levels. Ultimately, due to the peak in internet growth and the high computational costs of AI, DAU's significance has begun to wane, with new metrics (like DAA) emerging as alternatives.
I. DAU Didn't Appear Out of Thin Air: From PV to UV, Spawned by Mobile Internet
The emergence of DAU was a result of the needs of the times, not the invention of any single individual:
- Deficiencies in Previous Metrics: Early internet companies used PV (Page Views) to measure value, but one person browsing 10 pages was equivalent to 10 people browsing once; this method was highly misleading. Later, UV (Unique Visitors) was introduced, but it only counted the number of visitors without considering when they arrived—advertising is real-time, and today's user attention is more valuable.
- The Role of Mobile Internet: Mobile phones, being personal devices, allow for precise tracking of each user's daily behavior. In 2007, Facebook's growth team set DAU as a core goal and found that "new users with 7 friends retained within 10 days had higher retention rates." This strategy (later known as "growth hacking") helped Facebook grow from 100 million to 1 billion users. When Facebook went public in 2012, its IPO document publicly included DAU/MAU (Daily Active Users/Monthly Active Users) for the first time, making it a standard industry metric.
II. Why Did DAU Dominate for Ten Years? Both Advertising Models and Capital Contributed
DAU became a dominant metric driven by two main factors:
- Advertising Business Model: Internet companies rely on advertising for revenue; users use apps for free, and the platforms sell their attention to advertisers. The higher the DAU, the more valuable the ad space, as there is a direct correlation between DAU and ad revenue. Additionally, increasing user numbers doesn't incur extra costs (servers and bandwidth are fixed), meaning each additional DAU brings potential income.
- Capital's Quantitative Needs: Early internet companies often suffered losses, and traditional financial metrics (profits, revenue) were insufficient for valuation. DAU transformed the intangible concept of "attention" into a comparable number, allowing capital to quickly assess company value. During China's internet boom, this logic was directly adopted, with DAU becoming a standard part of fundraising presentations.
III. What Tactics Were Developed Due to the Focus on DAU?
DAU was not just a metric; it also influenced product design:
- Push Notifications: Users who didn't open an app yesterday would be considered inactive, leading to notifications (e.g., "Shocking! Something Major Just Happened in the U.S.") or even SMS and email bombardments to encourage them to open the app.
- Endless Scrolling: Designs that prevented users from reaching the bottom of a page, creating a sense of permanence and encouraging longer engagement (the inventor later regretted this, stating that 200 billion scroll actions worldwide wasted attention daily).
- Red Dots & Check-ins: Utilizing psychological mechanisms like the need for validation (red dots) and fear of loss (missing check-ins would negate previous efforts) to motivate users to open apps daily.
- Free Offers & Virtual Rewards: Strategies like "buy now, pay later" or gamification (e.g., collecting "energy" in virtual ecosystems) were used to encourage daily app use, regardless of whether the users actually gained anything from the app.
IV. Why Does DAU No Longer Work in the AI Era? Costs Are the Key Factor
The decline of DAU was gradual, with cracks appearing over time:
- Stagnation in Growth: Internet user growth slowed after 2020, and the proportion of "zombie users" (those opened apps but left without engaging) increased. Maintaining high DAU became increasingly difficult, leading to a vicious cycle where more notifications only annoyed users.
- The Cost Revolution of AI: While adding users didn't increase costs in the internet era, AI products incur additional computational expenses with each new user. DAU no longer represents a source of revenue but has become a burden. For example, Baidu's Robin Li proposed using DAA (Daily Active AI Users) as a replacement for DAU because it measures users who actually utilize AI features.
- Meta's Milestone: In 2022, Meta experienced its first decline in DAU, resulting in a 26% drop in its stock price (a loss of $232 billion), marking both the end of DAU's dominance and the beginning of a new era.
Conclusion: Metrics Are Never Neutral
DAU was a crucial metric in the internet age, measuring traffic but neglecting user engagement. New metrics (like DAA and token counts) will have their own challenges. The key is to be aware of what these metrics measure and what they inadvertently sacrifice. DAU has fulfilled its role, and the next metric for the AI era is already on its way.