Mixpanel Trends Report: How will the next generation use computing?

The technology we grow up with has a powerful and lasting impact on the devices, software and products we choose to use. We adults--those born before the 90's--did not have connected devices available at all times as kids. Growing up my mom always made sure I had a quarter to use the payphone to call home, something that never crosses my mind with my kids.

Today kids are surrounded by and have regular access to connected devices starting at a very young age. As a mom, I am amazed to see my two year old pick up our family iPad, unlock it and quickly navigate to her favorite app. She can do this without even being able to say the word "iPad". She calls it the "dooby doo" after her favorite cartoon (what can I say the kid has good taste). Daily use of computers, tablets, mobile phones and other portable learning devices is the norm for this generation. They are growing up connected and have a different level of expectation about what they should expect from a digital service.

To understand this better, we took a closer look at mobile game apps as this is the one vertical with strong usage across all age ranges. We've taken a sample of anonymized data from three types of games running on iOS devices:

  • Games designed for kids under the age of 10

  • Games with a primary audience of adults (defined as age 20+)

  • Games that have strong usage across age groups to act as a control

Kids are not using phones. Instead tablets are the center of action with 77% of activity in game apps for kids taking place on these devices.

Comparatively, adults are all about their mobile phones (no surprise if you walk down any city street and look at the people around you). The game apps with a primarily adult audience have 65% of their activity taking place on mobile phones.

To put this in perspective the game apps that appeal to all ages have a much more even spread of activity across devices. The developers of these games need to make sure their apps perform well on all devices.

Now this probably has a lot to do with who is purchasing the devices, but this heavy use of iPads and iPod Touch will impact the baseline expectations of these kids on what their device interaction should be. Are kids today going to be happy with the smaller screens of mobile phones? Or are the "phablets" going to become an even bigger category as kids get older and start purchasing their own devices? Or will kids become true multiple device users, staying loyal to their tablets even after they have their own phones?

Fred Wilson set the bar for retention when he said that most app developers will only see 30% of their installed base come back and use their app at least once a month. But an average of app retention disguises many of the variables and does not give app devs a more precise benchmark for what they should expect. Recently at Mixpanel's DDC2013 event, Omar Hamoui, a partner at Sequoia Capital and founder of AdMob and ChurnLabs, shared how he set their retention goal at 40% when they launched their first app, only to miss the mark within the first week. So does Fred Wilson's 30% benchmark hold steady across age groups?

The short answer is no. Game apps for kids have a markedly lower rate of retention. On average they only retain 12% of their customers after one month. But on the bright side, the majority the customers they retain do stay active after month two.

Game apps for adults solidly beat the 30% benchmark. On average apps with a primary audience of adults retain 41% of their customers after one month. They also keep most of these one month customers for a second month before retention really starts to drop off.

Apps that have a wide spread demographic also have an equally wide spread rate of retention. On average these apps retain 28% of their customers after one month--much closer to Fred Wilson's 30% mark.

Surprisingly all age groups keep their mobile device software up to date. I had assumed, given the difference in devices used across age groups, that the OS software might not be kept up to date on devices used by kids. But people, regardless of age, keep their iOS version up to date.

The data in this report is based on an aggregated set of the more than 15+ billion actions analyzed by Mixpanel each month. In Mixpanel, an action is defined by our customers and can be anything from logging in to an app to making a purchase or finishing a level in a game. The data in this report is segmented by games designed for kids under the age of 10, games with a primary audience of adults (defined as age 20+) and games that have strong usage across age groups to act as a control.

The report analyzes actions during July and August 2013. During this period of time 50% of actions analyzed by Mixpanel took place on desktop devices and 50% took place on mobile and tablet devices, as shown by the Desktop vs Mobile re port on Mixpanel Trends.

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