Datadog Retention Analysis is a tool that helps measure the long-term viability of an application by tracking fluctuations in user engagement over time. It provides high-level cohort graphs to study how many users are returning to specific features in the application, enabling the measurement of overall user satisfaction and identification of pain points in UX that can be optimized. By analyzing retention rates, developers can troubleshoot UX issues using Datadog Heatmaps and Session Replay, gaining a closer view of user behavior and identifying problematic elements driving low retention rates. The tool provides insights into user demographics and allows for filtering data based on characteristics such as session type, browser, or country to spot pain points that may be affecting retention rates.