What is an Active User & How To Properly Define it in Video Games

We are living in an era in the gaming industry where the number of active users you have is the first thing a lot of players, developers and investors check. A high player count is associated with a good game, and rightfully so – if so many people are playing it, the game must be doing something right. However, behind the scenes, very few people in the industry actually know why this is the case and more importantly how to calculate it correctly in the first place! In this post we are going to investigate Active Users metric; why it actually matters, how to measure it correctly, and a key concept to translate the number into useful insights.

Why does Active Users matter for anyone?

A lot of games brag about how many active users they have, and when reporters write about popular games, the most frequently used sentence you will see is “this game has X daily active players”. We, the players and the outside experts, look at these numbers and intuitively understand that this is a big deal, but rarely think on it further. In this sense, Active Users is a vanity metric – one that gives you bragging rights and measure your success without a particularly complex calculation. However if you go one layer deep, it is an incredibly useful metric that every developer and company should spend time and effort understanding. The benefits of Active Users metric can be grouped into two areas: external and internal.

External Benefits

The external benefits are quite straightforward: the more active players you have, the more popular your game is. And when the game is popular, it actually brings in more players, which increases the popularity – it is a loop that snowballs a game into decades of success! An interesting caveat to note here is how this ties into the monetization, and in turn the monetary success, of the game.

If the game is monetized through upfront sales, then Active Users feels like it may not matter, but with the surge of game streaming services like XBox Game Pass it actually translates to more playtime and inadvertently, more revenue. If the game is Free-to-Play and monetized by in-app purchases, then Active Users is critical. In a very simple analogy, you can’t sell things to someone who is not even in the shop – so your users have to be active to be monetized.

Internal Benefits

The internal benefits are how active users benefit the game itself, and is an area that very few developers put thought into. All of the example points I am going to mention is worthy of having their own posts, but I will summarise them in single sentences in this post for the sake of brevity.

Having more active users, and an accurate calculation of it, is a must to calculate your server and infrastructure planning. If the game is Player-vs-Player, you have to have more active users to have a balanced matchmaking between players. Finally, all of the players are actually game testers to some degree, whether they notice it or not. So an obscure bug you have, or an imbalanced item in the game is much more easy to identify when you have more players that can encounter these things.

Pro-tip: Players are going to find bugs and break the balance of the game after you release it. There is no way around it – you can’t possibly hope to find more issues with a Quality Assurance (QA) team than a playerbase of thousands of players. Of course this does not mean don’t QA, but be aware that players finding bugs and exploiting the game is just the nature of the industry, so do your best to take advantage of this instead of seeing this as a failure of developers.

You (and almost everybody else) is calculating Active Users wrong

Now that we have established having a high Active User count is very important and useful, the next step is understanding how it is measured. When calculating Active Users, most companies have vague definitions and calculate it in a deceivingly simplistic way:

How many players logged in to the game?

Why is this misleading? Well, this does not involve someone playing the game at all! How can a player be a player if they don’t even… play? Someone might misclick the app icon and quit immediately afterwards, or someone else logs into the game, checks out the menus for a while and does not feel like playing a match and quits. In most companies these are counted as active users, but we can tell immediately that they did not play the game.

This point is a big difference between the video game industry and other digital apps. For example, for a daily reminders app, this is a perfectly legitimate definition but it is not for a video game. An alternative that I propose is defining activity by:

  • actual playtime – number of minutes played
  • played at least X match(es) / game(s)

This is going to be much more accurate and representative for all of the use-cases of Active Users we defined above. Metrics are only insightful if they are accurate, and just counting the logins is not accurate at all. Here is an example that may sound extreme but is really not, especially for a game in development. What if de to a bug the players are kicked out of the game immediately after login? You would not see this massive issue just by looking at Active Users by login, and for such a critical error you want to be able to observe it as soon as it occurs without having to look at other metrics.

All Active Users are equal, but they are not the same

  • New vs. Existing vs. Returning Activity
    • Focus on New, Activity vs. Activation (from pirate metrics)
  • Tie-in to Content Design blog

In my previous post about XCAHJSFJ, I mentioned that the active users are split into New, Existing and Returning users. This split is equally important for active users calculation. We may have a set number of active players, but in that audience, there are three distinct behaviours, all very different from each other. The activity of a new player may just be finishing the tutorial and call it a day, to return the next day as an existing (onboarded) user and that would be the goal. For an existing player, we should be monitoring if they are playing roughly the same amount, or whether they play more or less than yesterday. For Returning users, we actually should consider whether a single match is enough or not – maybe they just came back to check the changes out and after one game they decided they still do not enjoy it. Technically they are “active” on the day, but did they actually return to the game?

This is what I mean when I say not all activity is equal. Having a single definition to tally up the number of active users is the first step, but having this split into new, existing and returning players is the immediate second that increases the usefulness of the metric exponentially. This is not the case for all metrics you can calculate, but as stated above the behaviour of these three groups are so different from each other that not having a split view into these audiences will make Active Users metric far less useful than it could be.

Conclusion

For the last few years the gaming industry have shifted in such a way that active users have been the go-to metric to measure success. However, most companies fail to understand the definition, all the benefits, and all the nuances of this critical number and just stop at the “vanity metric” point. Have a look at how you define active users, split and approach them properly and your understanding of your own product is going to level up immensely. Now you know how to do these and all the benefits an accurate Active User measurement it will bring.