Apps with Rewards Retain More Users – Here’s Why

You may have heard about a study on user engagement conducted by IPG Media Lab. It focused on user reactions to moment-based rewards versus traditional ads, including how rewards shaped opinions of brands and mobile apps.

While we anticipated some preference of rewards over ads, we were blown away by how much rewards affected user experience in apps, including excitement, favorability and retention.

user retention phone

Image source: Flickr, user: Jorge Gonzalez

Rewards increase user excitement

IPG’s study enlisted facial coding and biometrics to show user reactions during “achievement moments” in apps. Achievement moments occur when the user has accomplished a task, like beating a level in a mobile game.

The study found that excitement levels increased by 40 percent during achievement moments. Facial coding showed that users smiled, and biometrics, like user heartbeats, further proved signs of positive anticipation during achievement moments.

IPG found that this increased excitement was the perfect time to introduce users to rewards. When rewards appeared, excitement increased another 31 percent. This means that apps have the ability to make users even happier via rewards. Apps with rewards don’t just satisfy a need or provide entertainment – they bring users joy when they reach these peaks.

excitement

Rewards increase app favorability

Users acknowledge that advertising is necessary in order to use freemium apps. However, it turns out that users have different reactions to various types of ads.

Traditional ads, such as banners, full-screen interstitials and video, may garner awareness for brands, but they hurt both brand and app favorability. When asked why these ads decreased favorability, users responded that they felt the ads intruded on their in-app experience.

On the other hand, rewards increased favorability for brands and apps. Users believed that rewards complemented the app’s experience.

The study proved that 84 percent of users prefer rewards over traditional ads. Users found some of the traditional ad formats unacceptable, highly preferring mobile marketing that brought them direct benefit.

Some quotes from the study include:

  • “I like that Any.Do rewards me for getting things done. It ads [sic] a sense of accomplishment.”
  • “Full-page ads are super annoying. Ads are okay in my book if they give me rewards, though!”
  • “Having Kiip rewards on your app will make me want to download it more.”

acceptable

Rewards increase user retention

Simply put, rewards congratulate users when happiness, attention and engagement levels are at their highest.

Rewards appear at the perfect moment and offer users a direct benefit. Users who log a finished workout in a fitness app are proud of their accomplishment. When the app offers them a free sample of Propel Fitness Water to congratulate them, they feel their behavior is validated.

The result is higher app re-engagement. On average, users who engage with Kiip return to the app 30 percent more often.

What’s more, rewards cause users to spend 68 percent more total time in the app, double the length of their typical session and open the app 31 percent more often.

outperformance

The bottom line: the best mobile apps have rewards. Users gravitate towards apps that deliver excitement and benefits, and stay engaged for longer periods of time.

Have questions? We’d love to answer them. Write to our support team or reach out to us on Twitter.


Rewards lead to higher engagement among users and better monetization for developers. 84 percent of mobile users say they prefer mobile rewards vs. ads, and over 3,000 games and apps already use Kiip to monetize. Learn more about Kiip at kiip.me/developers.

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  • Rnni

    Nice article Brittany ! It’s great to see some actual figures on the effects rewards can have.
    I also strongly believe in the power of rewards. It’s a great way to engage with users, motivate them and increase app retention. And it’s really important to do that at some achievement moments as you mention. We basically used http://www.kiip.me and http://www.polljoy.com to do that and helps us quite a lot with retention.
    However I think reward on social media, might be a good solution too. Although seems like apple is being harder with some in-app reward solution.

    • brittanyfleit

      Thanks for reading. I’m glad to hear you’ve had success with Kiip!

      We completely agree with you about rewards for social media activities. Be on the lookout for an exciting announcement soon regarding that.