How gamification drives mobile app engagement and business value

Gamification in mobile apps enhances user engagement by integrating game mechanics, influencing retention and increasing business value across platforms

TikTok’s transformation from a simple video-sharing platform to one of the world’s most engaging social media apps demonstrates the power of gamification in driving user engagement. The platform incorporated game-like elements such as achievement badges for content creation, level-based privileges, and ranking systems that reward consistent engagement. This gamification strategy helped propel TikTok to become the fifth most downloaded app in Apple’s App Store, with users spending an average of 95 minutes per day on the platform.

The platform’s gamification architecture operates on multiple levels to sustain user interest. Content creators can unlock creator tools and features as they reach follower milestones, similar to levelling up in traditional games. The app’s “For You” page employs a sophisticated reward system where videos gaining traction receive exponentially more visibility, creating a compelling feedback loop that encourages continued content creation. Even viewers participate in the game mechanics through challenges, hashtag competitions, and duets that transform passive consumption into active participation.

TikTok’s success illustrates how gamification can create powerful engagement cycles that benefit both users and the platform. When users achieve certain engagement thresholds, they gain access to additional features like longer video lengths and enhanced analytics tools. This progression system has proven particularly effective at converting casual users into active content creators, with over 83% of users posting their own videos. The strategy demonstrates how well-designed game mechanics can transform traditional social media dynamics into an engaging, game-like experience that drives sustained platform growth.

App developers, user engagement and business value

Yet TikTok's success stands in stark contrast to the broader challenge facing mobile app developers: declining user engagement over time threatens their ability to generate business value. Research from market intelligence firm Localytics found that a day after downloading an app, just 27.6% of users are engaged with the app, dropping to 11.4% two weeks later. This engagement crisis prompted developers to explore gamification – adding game elements like points, levels and rewards to non-game apps.

A new study published in the Journal of Marketing Research examined how gamification impacts user engagement and business outcomes. The research paper, Driving Mobile App User Engagement Through Gamification was co-authored by Professor Harald van Heerde in the School of Marketing at UNSW Business School, together with the University of Cologne’s Assistant Professor of Marketing Jens Paschmann and Professors of Marketing, Franziska Völckner and Hernán Bruno along with University of Bremen Professor of Marketing Kristina Klein.

“Many mobile app providers offer their apps for free and base their business models on user engagement. However, declining usage over time threatens apps’ ability to add business value,” the researchers noted. “To keep users engaged, app providers use gamification – that is, they use game elements (e.g., levels, points) – in their nongame apps.”

“The research team collaborated with a startup specialising in market research via mobile apps,” said A/Prof. Paschmann. “This innovative app stood out by delivering survey results in near real-time, making sustained user engagement essential to its success. To achieve this, the app provider sought to go beyond traditional reward strategies such as coupons and discounts for survey responses. In addition, they introduced gamification elements to leverage users' intrinsic motivation, providing a cost-effective way to create a more engaging user experience."

Understanding mobile app gamification strategy

The study analysed daily app usage data from 18,952 users of the gamified market research app over one year, examining how game rewards and traditional value rewards (like discounts and coupons) impacted user behaviour. The app incorporated both game elements, such as experience points and levels, as well as monetary rewards for completing market research surveys. Users could progress through 26 different game levels by answering fun questions that earned them experience points, while simultaneously accumulating coins for completing client surveys that could be redeemed for vouchers or charitable donations.

“Complementing traditional loyalty strategies that reward value-added activities through value rewards, gamification rewards ongoing engagement through game elements,” the researchers explained. This hybrid approach aimed to drive both intrinsic motivation through game achievements and extrinsic motivation through monetary incentives.

Read more: Five mobile app tactics that will add value to your brand

The research team tracked every user interaction within the app through millisecond-based event logs, measuring both the quantity and quality of engagement. They examined how users responded to different reward proximities – how close they were to achieving the next reward – and reward attainment when users reached their goals. The app displayed progress bars showing users how close they were to reaching the next game level, creating a clear visual representation of their advancement toward rewards.

The impact on user engagement

The research found that game rewards significantly increased user engagement beyond what traditional value rewards achieved alone. When users were closer to achieving both types of rewards, engagement lifted even further. The study showed that moving from low to high game-reward proximity increased gameplay probability by 40% and time spent on gameplay by 124%. Similarly, proximity to value rewards increased gameplay probability by 54% and survey completion rates by 62%.

Moreover, the researchers discovered a complex interplay between game and value rewards. When users achieved game rewards, their likelihood of completing surveys decreased by 63%, and the average time spent per survey dropped by 67%, the researchers noted, highlighting how success in the game could potentially detract from core business objectives.

The study revealed that timing played a crucial role in maximising engagement. “We propose a temporal decoupling of reward attainment in the engines, for example, by providing game rewards at a higher frequency than value rewards,” the researchers suggested. This approach helps prevent the negative effects of simultaneous reward achievement, which could lead to temporary disengagement from both types of activities.

There is a downside to gamification, however. “When users enter a state of flow in the game, they become so immersed in gameplay, that their responsiveness to business activities diminished,” the researchers cautioned. When users experienced high flow states, the positive effect of game engagement on survey completion probability decreased from a 33% lift to a 20% reduction, demonstrating the importance of carefully managing user immersion levels.

Key recommendations for mobile app developers

The study provided several practical insights for mobile app developers seeking to implement effective gamification. The researchers found that game rewards needed careful structuring to avoid cannibalising core business activities.

“To prevent this effect, app providers can restrict access to certain game rewards until users have engaged with a certain number of value-added activities such as answering surveys or watching ads,” the researchers advised. “For the time of the restriction, value-added activities could be integrated into the gamification process, such that users earn game rewards through value-added activities such as watching ads.”

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The research demonstrated that gamification can serve as a cost-effective engagement tool when properly implemented. In a simulation with 100,000 users, introducing game rewards generated €6400 in additional revenue at zero marginal cost, compared to €5600 from value rewards which cost €6300 to implement.

For mobile app developers, the key takeaway centres on finding the right balance between game and value rewards. The researchers showed that while gamification can dramatically boost engagement, it requires careful implementation to ensure it enhances rather than detracts from core business objectives. Success lies in creating reward systems that align game achievements with value-generating activities while avoiding reward conflicts or too much immersion into the game that could reduce overall business impact.