when it's obvious you're going to lose the battle. Saves time so you don't have wait for all your characters to drop. You can put it in auto mode but still.
It's already in there. Click the little gear in the upper left and click Retreat. Note that, in addition to using it to bail out of obvious losses in arena, that button also preserves everything you have left for Galactic War. It's necessary for proper GW strategy.
There have been a few times when it looked like I was gonna lose but ended up winning it due to AI stupidity and got a free kill or a crit goes the right way, never trust AI they often trip over themselves.
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