The bottom line
Adding games inside an app makes it more habit forming and brings users back, and ad revenue from those games opens a new income stream. This matters because a small gain in retention lifts profit sharply.
Key takeaways
- A small gain in retention lifts profit a lot. 1:28
- A 5% increase in retention can raise profits by 25% to 95%, a stat credited to Bain and Company.
- Only 26% of users globally return the day after install, so most first-time users are lost at once.
- Habit forming is the hardest phase of retention to get right. 4:39
- It follows onboarding and activation. An email on Our most popular workouts doubled one client's workout rate and cut trial cancellations.
- The usual habit tools are community building, loyalty loops like Duolingo streaks, and network effects.
- Games are the simplest way to make an app a habit. 5:28
- In one client's runner game, users opened the app only to spin a reward wheel, collect credits and leave.
- In-app games also earn extra ad revenue, even in finance and entertainment apps. 6:28
- Fin Shell Pay, a finance app, and Watcho, an entertainment app, both embed games that run inside the app.
- Ads shown during play generate revenue that is shared with the app owner.
- The extra engagement counts toward the app's own numbers. 9:32
- It lifts monthly and daily active users, which investors want to see, and it helps ASO.
- Over 9,000 apps already use the platform, and setup takes under 30 minutes.
Games are super popular and a great tool to bring users back into your app.
Steve P. Young
Chapter summaries
0:00 Why engagement matters once an app has scale
Retention becomes the main lever once an app has moved past its first growth.
- Engagement matters most after an app has grown 0:56
- Early on, revenue and downloads come first.
- Once an app is a few levels deep, engagement is the lever.
- The goal early on is going from zero to one.
- The retention stat comes from Bain and Company, the firm behind the Net Promoter Score.
- A day-one return rate near 25% is worth protecting 2:13
- The day-one return is technically the user's second open.
- Apps that reach it must work to keep those users.
- Retention is tracked by category at day 1, day 7 and day 14.
- The 26% figure is global, so it varies by category.
2:37 Keeping users through onboarding and activation
Each early phase has its own job, and each one protects the retention that follows.
- Onboarding should get users to the core value fast 2:50
- Show the one feature the app was built for, not all of them.
- Keep navigation simple and ask users what their goals are.
- Capture the goal data even if nothing is done with it yet.
- Asking makes users feel the experience is personalized, which lifts retention and monetization.
- Activation introduces advanced features step by step 3:45
- Start with simple features, then add advanced ones.
- Use behavioral reinforcement and progressive rewards.
- The goal is getting users to actually use the app.
- The email went out once users had activated a trial.
5:39 Games that keep users inside the app
A game built into an app turns a small reward into a reason to come back, and the user never has to leave.
- A reward mechanic alone can pull users back. 5:41
- The game was a simple runner, built years ago.
- The spinning wheel paid out rewards inside the game.
- Players skipped the game itself. They opened the app, spun, took the credits and left.
- Embedded games run inside the host app, so users stay put. 7:34
- On Fin Shell Pay, a free games section opens a ready-made collection of titles.
- On Watcho, a game like Blaze Rider loads inside the app through HTML5.
- Fin Shell Pay is popular in India and offers loans, payments and deals. Games are the last thing you expect there.
- Watcho's owner gets 50% of what the games platform earns from ads shown during play.
- Netflix and Apple Arcade also offer games, which shows how popular they are.
8:34 More than games
The same platform adds other daily-use content, so an app can earn beyond subscriptions.
- Big names already use it, and the content goes past games. 8:42
- Users include Microsoft MSN, Samsung Internet, AccuWeather and Opera.
- Apps can add quizzes, daily horoscopes, and cricket news and videos.
- The speaker likes the daily horoscopes in particular.
- Ad revenue adds to whatever income the app already has. 9:18
- It sits on top of subscriptions or any other way the app makes money.
- All this content stays inside the app, so the engagement counts toward the app.
In the growth library
Steve P. Young, Founder of App Masters. Retention work can be split into onboarding, activation and habit forming, and adding games through a plug-and-play tool like Gamezop is offered as a quick way to build the habit and add ad revenue. The video is a sponsored walkthrough, so the claims about the tool come from the host and its partner, not from tested results.
Lessons that draw on this:
- How to use notifications and lifecycle messages
- How to ask and use onboarding questions
- How to get users to the aha moment fast
- How to build habit loops that bring users back
- How to add ads, affiliates and partners
- What metrics to track and how to define them
- How to measure retention honestly
More from
App Masters · The whole library, and ask it anything