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User Acquisition

App Rewarding Psychology: How to Reward App Users

One of the best ways to acquire more quality traffic is through rewarded ads. But it’s important to understand how to reward app users to maximize their quality. Apps must therefore find rewarded ad solutions that validate diverse users’ needs. 

Think about going shopping.

There are people who are highly motivated to tick off everything on their shopping list and complete their shop as quickly as possible. Other shoppers enjoy progressing at their own pace; they browse and purchase products without a shopping list in mind.

Is either customer less important than the other? No. Stores must provide the in-store experience for both of these personalities.

Mobile users, too, are motivated in different ways when they use their favorite apps. That’s why apps will only attract them and extend their lifetime value if they deliver relevant rewarded experiences.

Time-Based or Action-Based Rewards?

Some mobile advertisers are still stuck on the question: “Rewarded ads or no rewarded ads?” But in 2024 it must really be a question of “Which types of rewarded ads?” 

Advertisers should fine-tune their UA strategy and consider how to reward app users in a way that drives greater retention. 

Because all mobile users are different, advertisers should hedge their bets by acquiring different user types with both time-based and event-based reward campaigns. 

There are different types of users, according to self-determination theory

Extrinsically motivated users, who

  • are driven by achievements, rewards, or recognition
  • seek experiences for the thrill and the pressure
  • respond well to being given tasks (events) and goals and are satisfied by achieving them

Intrinsically motivated users, who

  • are in it for the experience, explorations, and overcoming their own challenges
  • seek experiences for pleasure, freedom, and relaxation
  • are more likely to stick with a task long-term
young man smiling on his phone

Advertisers are more likely to scale their apps and enjoy higher retention from quality users if they meet the needs of both user types.

Attract Users with Action-Based Rewards

We’ve explained that extrinsically motivated users are driven by event-based rewards. But there’s more to it than that.

One event is not enough to drive impressive retention rates. 

Advertisers need to deliver the right types of rewarded ads to acquire these particular users – and retain them. They should start with rewarding users for completing an early event that drives instant gratification and motivates them to progress toward the next in-app event.

The ideal number of events users need to complete to become a loyal user is ten, based on our team’s experience. Five events should be the minimum and fifteen should be the maximum number of events.

abstract funnel that shows users moving through an event funnel with 10 events to become committed

Advertisers choose to trigger rewards for events that are challenging but achievable. If they are not sure which events will convert best, they should test it. In adjoe’s experience, these events include level completion, tutorial completion, and building elements (for example, a village or castle). 

These events might look like the following for various mobile game genres. 

  • Hypercasual games: Reached Level 1, Level 5, Level 15, Level 40 
  • Social casino games: Completed registration, reached Level 10, invited a friend, unlocked an achievement
  • Strategy games: Completed a tutorial, built village 1, built castle 1, joined alliances, reached Level 50

If mobile advertisers want to acquire and retain these milestone hunters over the long term, they need to fine-tune and test their rewards strategy. Is it too easy for users to reach Level 5? Is it too difficult for users to join an alliance in their favorite strategy game? If so, they might drop off.

Tap into Users with Time-Based Rewards

And then we come to intrinsically motivated users. To attract and successfully retain intrinsically motivated users, advertisers should reward users for their session durations and engagement rather than their actions and achievements.

Intrinsically motivated users appreciate continuous rewards for their commitment – this piques their interest.

Let’s think about a mobile game. 

Rewards should again be easy to achieve at the beginning of a user’s journey – there should be a low barrier of entry to the game. The further the user progresses in the game, the less incentives they will need to stay because they’re already invested in it – in terms of time and effort.

The effort users put into engaging with any app should be equal to the value of the rewards or benefits they receive in return. If they don’t approve of the rewards, they’ll churn.

If they approve of the rewards, they’ll be loyal. Advertisers will subsequently enjoy higher retention.

Playtime Delivers Both Types of Rewards

The rewarded ad unit Playtime lets advertisers choose how to reward app users. Regardless of which user type they are.

It delivers campaigns for both continuous time- and event-based rewards. In doing so, Playtime validates and addresses the needs of both user types and attracts their attention.

diagram showing the different user types receive different rewards based on how they interact best with an app

Continuous rewards mean Playtime users don’t drop off after their one-time reward; they stay to enjoy the app for longer, and they enjoy it more frequently. The ad unit’s time- and event-based rewards align with the customer psychology principles we explored.

App marketers can also customize and test their unique event-based event funnels to ensure users stay in the funnel until the end. Advertisers might test various funnels with different event-based rewards – such as tutorial completions and reaching certain levels. 

If some of these users are only motivated to complete various events, advertisers should reconsider the difficulty level of the events or the order of events in the funnel.

Know How to Reward App Users to Stay Competitive

Advertisers must diversify their UA channels and include rewarded ad formats – this is nothing new. But not all rewarded ads cater to all user types. Advertisers should therefore take this into consideration to boost the scalability of their apps.

This is how UA teams will remain competitive. By attracting all user types, apps automatically grow more sustainably; their UA strategy becomes more robust.

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