Consider a DAU track enough?

In this case, you do not see the whole picture.

Here is a translation of an interesting reflection article from Robert Weber (co-founder and executive director of new products for W3i) about what really hides the popular metrics used to measure application success.

In the mobile world, companies often live by metrics: “How are MAU? What is the return of users? How many downloads are there? ”Many developers ask themselves such questions every day. Such metrics can have very different interpretations, and, accordingly, can both raise developers to the top of the charts, and overthrow them from there. Given the mindset of Silicon Valley, based largely on successful stories like Instagram and Socialcam, and advocating the principle of "today users, tomorrow is money," this approach greatly enhances and even extols the role of metrics. Sometimes they become even more important than the financial performance of the company.

But what do they all mean? In the mobile realm, daily active users (DAU) are usually the standard by which developers are judged. However, in the mobile industry there is no clear and unified definition of what these DAUs really are. Some analytical systems, such as Flurry, for example, use moving averages, for which the user is considered active if he opens the application at least once every seven days. Others believe that the user is active, who uses the application every day.
Therefore, in order to really determine the real success or failure of a project, you must first decide who the “active user” really is.

Understanding user habits and behavior

Before we can really understand how best to measure and create reports based on metrics, it is worth understanding the nature of the behavior of mobile users. W3i works with hundreds of mobile developers and gets large layers of data about how users interact with applications.
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The first thing to think about is that developers may lose two thirds of their users on the first day. The data show that, on average, for most applications, the user return rate is kept at around 31% after the first 24 hours. In any other business, the loss of such a significant part of the audience is a disaster, which cannot be said of the mobile application market, where this is the norm.

After the first day, it can be expected that retention may even out a bit, but it will steadily decline. After seven days, the average user return is reduced by about two times and reaches 14 percent, at the end of the first month, the indicator is fixed at an average of 6 percent.

In light of these figures, it is not surprising that developers prefer to judge the application by the DAU metric. Who knows what your users will like in a day, not to mention that they will want in a month?

The point is that you need to understand what kind of users you need. However, on paper it may turn out that things are going great for you just because the user started the game for 5 minutes once every seven days. This hardly makes the user truly “active.” However, such a definition of the concept of DAU, is quite common, artificially inflating the user base for many applications.

By launching an application, a user can, for example, make an in-app, or view an advertisement, in connection with which it makes sense to consider active those users who started the session on this particular day. In short, DAUs should be considered the most obvious way: the number of people who actually used the application on a particular day. This figure should maximize the potential of the application in terms of generating profit and will be the best indicator of how things really are at the application itself.

Once the developers have decided on what their ideal user is, they need to design the application so that it influences these users as much as possible and makes them come back time after time. Several iterations can help ensure retention stability. As soon as the necessary indicator is reached, it is possible and necessary to resort to a more aggressive form of attracting new users. Each source of new users must be evaluated in order to determine where the maximum income comes from.

This model is especially effective for mobile games. Mobile games have always been apart from console and computer games. While gamers can sit in the bedroom for hours chasing their 80th-level elf in WOW, and console gamers spend their days flying in Halo, mobile gamers have their own playing habits. Most often they play in buses, in lines and just out of boredom. It is not surprising that the “lifetime” of a mobile game is significantly different from the console one. Class A console title is capable of keeping the user involved for several months, while mobile games lose a significant portion of users on the first day.

Here are a few mechanisms that allow you to monetize the current DAU (as a game, and any other application that uses game mechanics):

• Give users the currency inside the application, helping them learn more and allowing them to “feel” how to use the application.
• But at the same time, don’t give too much (for example, levelers or random situations), but keep on giving. So the user feels like he is gaining valuable gaming experience.
• Guide users through the scenarios in which they can use the currency more often. For games, these can be upgrades or moments that help you get through the game.
• Update your application more often, even for minor updates. The update can encourage an inactive user to enter the application and see what's new there.
• It is important to understand that not all active users are equally valuable. Adding an engagement metric that counts the number of sessions per user can be a great solution that helps you separate just active users from “super users”.

The market continues to evolve and over time it will become clearer which metrics should be taken into account and which should not. So far, it’s worth starting with the fact that developers need to understand what kind of numbers they really need.