Understanding Sarah Tavel's Hierarchy of Engagement: A Framework for Building Enduring Products

General
1

Sarah Tavel, General Partner at Benchmark and former first PM at Pinterest, developed one of the most influential frameworks for building enduring consumer products: The Hierarchy of Engagement.

The Three Levels

Level 1: Growing Engaged Users (Core Action)

The foundation isn’t just user growth—it’s growth of users completing your product’s core action. As Tavel puts it: “Growing users without growing users completing the core action is the empty calories of growth. It feels good, but it’s not good for you.”

For Pinterest, the core action is pinning. For Facebook, it’s friending. Without users completing these fundamental actions, the product cannot survive.

Level 2: Retaining Users (Accruing Benefits & Mounting Losses)

Once users are engaged, you must retain them through two mechanisms:

  • Accruing Benefits: The more someone uses the product, the better it gets. As users add data (explicitly or implicitly), the company uses this to improve their experience.
  • Mounting Losses: The more someone uses the product, the more they’d lose if they left. This creates natural stickiness.

Level 3: Self-Perpetuating (Virtuous Loops)

The final level converts user engagement into fuel that powers growth. The strongest virtuous loop is the network effect—where more users make the product better for everyone.

Case Studies

Pinterest (All Three Levels) :white_check_mark:

Pinterest exemplifies the complete hierarchy:

  • Core Action: Pinning
  • Accruing Benefits: The more you pin, the better Pinterest understands your interests, improving discovery
  • Virtuous Loop: Better discovery → more pinning → better recommendations → more users attracted

The product becomes self-perpetuating simply by users using it more.

Evernote (Only Levels 1-2) :warning:

Evernote achieved strong engagement and retention:

  • Core Action: Creating notes
  • Accruing Benefits: More notes = more value
  • Mounting Losses: Years of notes make switching painful

However, Evernote never created a virtuous loop to reach Level 3. There are no network effects—your notes don’t make the product better for others. This is why growth eventually plateaued.

Key Takeaway

To build an enduring, billion-dollar business, you must take users through all three levels. Optimizing effectiveness at each level maximizes your chance of building something that lasts.

What are your thoughts on this framework? How does it apply to products you’re building or using?

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Great breakdown of Tavel’s framework! The challenge I’ve seen across multiple products is identifying the right core action in the first place.

Some questions I wrestle with:

  1. What if you have multiple potential core actions? For a product like Slack, is it sending a message, creating a channel, or @mentioning someone?

  2. How do you validate you’ve chosen correctly? Tavel mentions Pinterest’s “pinning” was obvious, but for many products it’s not so clear-cut.

  3. When should you pivot your core action? Instagram famously shifted from check-ins (Burbn) to photos. How do you know when to make that call?

My working approach: Look at what your most retained cohorts do in their first session that differs from churned users. That behavior often points to the true core action.

Would love to hear how others approach this problem.

3

This framework is both inspiring and intimidating as an early-stage founder.

We’re building a consumer app for habit tracking, and I’m struggling with how to think about Level 2 and Level 3 when we’re still trying to nail Level 1.

Our current challenges:

  • Core action seems clear (logging a habit completion), but engagement is sporadic
  • Accruing benefits are weak - we show streaks and history, but it doesn’t feel like the product “gets smarter” for the user
  • No obvious path to virtuous loops - habit tracking feels inherently single-player

The Evernote comparison hits close to home. Are some product categories just doomed to plateau at Level 2? Or is there always a way to engineer network effects?

I’ve been looking at Strava as inspiration - they turned solo running into a social experience. But forcing social onto a product that doesn’t need it feels wrong too.

Any advice from folks who’ve tackled similar “single-player to multiplayer” transitions?

4

The framework makes intuitive sense, but I’d love to dig into specific metrics for each level. Here’s my attempt at operationalizing this:

Level 1: Core Action Metrics

  • Core action completion rate (% of users who complete it in first session)
  • Core action frequency (completions per active user per time period)
  • Time to first core action (shorter = better onboarding)

Level 2: Retention Metrics

  • Cohort retention curves - looking for that “smile” where retention stabilizes
  • DAU/MAU ratio (stickiness) - Tavel mentions 20%+ is good, 50%+ is world-class
  • Feature adoption depth - are users accumulating data/value over time?

Level 3: Virtuous Loop Metrics

  • Organic acquisition % - growth from referrals, SEO, word-of-mouth
  • Viral coefficient (K-factor)
  • Content/data generated per user that benefits others

Question for the group: How do you measure “mounting losses” specifically? It seems harder to quantify than accruing benefits.

Do you just infer it from retention, or are there leading indicators like data volume, integrations connected, or social graph density?