This one took me some time to fully understand (and a fair bit of chat with the AdWords support team :)) on how audience retention rate is calculated in both platforms. We'll be looking at an example video that is 1 minute long and has been advertised in Google AdWords with a view rate of 15%.
Retention rate in AdWords:
Retention metric is broken down into quartiles. It is named as 'Video played till: 25%, 50%, 75% and 100%. It is available under the Performance columns. AdWords also counts it as a view once 30 sec of an ad has been played.
50% of a 60 second long video would mean at least 30 sec have been played (triggering a paid view count).
e.g. If the video has the following quartiles:
Video played till 25%: 20%
Video played till 50%: 15%
Video played till 75%: 12%
Video played till 100%: 10%
As the view rate is 15%, at exactly 50% of the video, 15% of the views have been till at least 30 sec.
Retention rate in YouTube Analytics:
This is also called Average Percentage Viewed which is the average percentage of your video watched. So, if a video is 60 sec long and the average view duration is 30 sec, the Average Percentage Viewed is 50%.
Coming back to our original example, YouTube Analytics counts audience retention for paid and unpaid views.
Note: IF you view the entire channel's retention rate, you will only see a single line chart with the retention rate. However, if you switch to a particular video, you can see the line charts with organic and TrueView ad retention rates.
As both paid and unpaid sources are counted in this metric calculation, a video with paid views and shorter duration will always have a really high audience retention rate. This comes back to Adwords where the user needs to watch at least 30 sec of an ad. In YouTube Analytics, you can be sure that the retention rate will be higher than 50%. Where it ends up depends on the content and how interested it keeps them it. I have even seen 70% retention with 3 minute videos so it's not completely impossible.
Hope this was helpful.