Activating Users to Drive App Revenue Growth

In this AF Chat episode, Ariel and guest expert Hannah Parvaz dive deep into the concept of user activation and its critical role in app revenue growth. They explore real-world examples, data-driven strategies, and actionable tips for improving user engagement and conversion through better onboarding, creative targeting, and product optimization.

Ariel: Welcome, everyone, to a brand new AF Chat! Today, I’m joined by Hannah, and we’re diving into a topic that’s absolutely critical for anyone building or growing an app—activation. This is something that doesn’t get nearly enough attention, but it’s truly the foundation of making money with apps. It’s not just about your paywall or onboarding; it’s about making sure your users actually use your app. We’ll break down what activation means, how to track it, and how to improve it.

Meet Hannah: From Music to Apps

Ariel: For those who don’t know Hannah, she runs an agency now but has a long history in the app world. Hannah, tell us a bit about your background and why you’re so passionate about apps.

Hannah: Thank you so much, Ariel. Lovely to be reunited again. As Ariel said, we met in San Francisco in September, just five minutes before going on stage together. My background is a little unconventional. I started in the music industry, working in live music, planning events, tour managing, and artist management for about 10 years. Over a decade ago, I got involved in music tech, and from there, I decided to stay on the tech side because I found it more intellectually challenging.

I worked on a live music discovery app pre-launch for almost three years, then moved to a nightlife app, went through an accelerator, and started coaching other startups. For the past six or seven years, I’ve focused on subscription products, working with hundreds of different apps, coaching on accelerators, and building pathways around product, activation, and meta ads. I love the challenge—no two apps are the same, and there’s always something to improve. I’m always running experiments, learning, and finding new ways to win. It’s just really fun for me.

Defining Activation: What Does It Really Mean?

Ariel: Let’s get into activation. I get a lot of questions about onboarding and paywalls, but there’s a fundamental concept underneath all of this: activation. You recently posted on LinkedIn about how users don’t really start using your app until they really start using your app. So, what does activation actually mean?

Hannah: There’s a big misconception about activation. At an event recently, I asked people what their activation point was, and I got answers like “when someone clicks play,” “when someone signs up,” or “when someone opens the app.” But that’s not it. Activation is the stage from when someone first starts using your product until they’re being retained. There’s a whole gulf between those points—that’s the activation period. Until you’re confident someone won’t churn (unless there’s a major life change), they’re still in activation.

Let me give you an example. I worked with a nightlife app where we initially thought activation was when someone downloaded the app and started looking at bars. But we saw big drop-offs between install, sign-up, and first redemption (getting a free drink at a bar). The real activation point was after the second redemption, as long as it happened on different days. After that, 90–95% of users would go on to a third redemption. When we talked to users, they said they felt “cheeky” using the app the first time, especially with friends. Only after using it alone did they feel confident and truly see the value. That’s when they were activated.

I’ve seen other products where it takes 20 or 30 conversions of the core action to reach activation. The key is to identify and map this point for your app.

Mapping the Activation Funnel

Ariel: So, you started by mapping out all the actions users could take and tracking the drop-offs between them. It’s not just about the first action—it’s about repeated actions until users are comfortable and see value. How did you continue from there?

Hannah: Let me use a different example—an audio journalism app. The core action was listening to narrated articles. We mapped the funnel: sign up, complete a story, complete another, and so on. We found that after listening to six stories, drop-off rates plummeted. That was the activation point. Once users hit that, they understood the product and saw value.

We always run the activation funnel in parallel with the conversion funnel. For subscription apps, you have install, sign-up, onboarding, free trial, and paying. But underneath, you have the activation funnel. For the 80% who don’t pay during onboarding, it’s crucial they experience value so you can convert them later.

Balancing Activation and Conversion

Ariel: There’s a trend where apps push users to a paywall right after onboarding, sometimes before users have experienced any value. While this can drive revenue, does it help with engagement and activation? Is there a better way?

Hannah: Having your paywall in the onboarding flow will dramatically improve conversion—sometimes so much that you might not care about activation at certain business stages. Early on, you need revenue to keep the lights on. But as your product matures and you gain confidence, you can delay the paywall. Big companies like Duolingo do this—they let you experience value before showing the paywall.

Typically, about 80% of trial conversions happen during onboarding. The remaining 20%—who convert later—do so at twice the rate because they’ve explored the product and have higher intent. Their retention is also longer. So, you have to balance short-term revenue with long-term engagement.

Audience Q&A: Can Better Targeting Increase Activation?

Ariel: Here’s a great audience question: Can you increase activation by better advertising targeting?

Hannah: Yes, no, and maybe! Targeting as we used to know it is mostly dead. Now, I keep campaigns as broad as possible and do targeting through creatives. Algorithms are so advanced that, even for niche products, the right creative will find the right users. The creative is your targeting.

For example, I once tested app store listings by showing them to strangers and asking what they thought the app did. Comprehension was only 20%. By tweaking the screenshots and messaging, I got it up to 90%. This improved conversion, activation, and retention. So, your ad creative, app store listing, and onboarding flow all impact activation.

Ariel: I agree. If your app’s messaging isn’t clear—from the icon to the screenshots to the onboarding—users won’t know what your app does or if it’s for them. This applies to both ads and app store optimization. Better targeting can help, but it’s really about priming users with the right message.

Leveraging Custom Product Pages for Better Activation

Hannah: In September, Apple launched a very exciting new feature—custom product pages. This allows you to link your ads to a specific onboarding flow inside your app, so you can match your ad’s message to the app store page and onboarding, optimizing the entire funnel. (Note: At the time of this conversation, this feature is rolling out and will be available on iOS 18 and above.)

We’ve seen click-to-install rates of 60–70% and install-to-trial rates of 40%+ by matching ads to custom product pages based on customer insights. This is significant impact for relatively little effort.

Ariel: Custom product pages are a game-changer. You can tailor messaging for different user segments, like sports fans, and show them exactly what they want. This dramatically improves downloads and activation.

Is Targeting Really Dead?

Ariel: Nathan asks if targeting is really dead and shouldn’t be used at all.

Hannah: It’s divisive, but we don’t do any targeting—just broad campaigns. Meta’s AI is smarter than us at targeting. The creative does the targeting. The only exception is if your product is only for a specific demographic (e.g., women only). Otherwise, let the algorithm work. Manual campaigns can be useful if you have a big budget, but automated campaigns usually perform better.

Ariel: So, ads need to do what your screenshots do—sell to the right audience and resonate with the right user.

What Methods Best Impact Activation?

Ariel: Another question: Which methods are best for user activation—notifications, welcome emails, onboarding, etc.?

Hannah: It’s not about one method. Everything up to activation impacts activation: ads, custom product pages, onboarding screens, push notifications, homepage, and more. We brainstorm all possible areas, score them for effort and impact, and prioritize. Sometimes, changing an ad’s messaging has the biggest impact; other times, it’s a tweak in onboarding.

For example, in an eco-action tracking app, adding a screen where users committed to a goal doubled day 3 retention. The number of good experiments you run is directly correlated to your success.

Ariel: Don’t get overwhelmed—just test one thing at a time. Figure out your app’s image, how to talk about it, and make sure that’s consistent throughout the user journey.

How to Identify the Activation Point

Ariel: How do you know when someone is truly activated?

Hannah: We look at the core action—like listening to a story in an audio journalism app. We map funnels in analytics tools: from sign-up to completing the core action multiple times. The activation point is where drop-off rates stabilize. It’s more complex in reality, as you need to look at individual user behavior and frequency cycles. But start by benchmarking your users and iterating from there.

Ariel: It’s an iterative, data-driven process. Don’t assume you know what users want—let the data guide you.

Final Advice: Talk to Your Customers and Test Everything

Ariel: Any closing words?

Hannah: Talk to your customers and test everything. Don’t assume you know what they want—just ask them. They’ll tell you the answers.

Ariel: I agree. Even if you’re not comfortable talking to strangers, start with an email. That’s how Appfigures started, and it’s how good apps get better.

Connect with Hannah

Ariel: Hannah, how can people find you?

Hannah: LinkedIn is best—just search for Hannah Parvaz (P-A-R-V-A-Z). I’m the only one! Connect with me, send your questions, and I’ll be happy to help.

Ariel: Thank you so much, Hannah. This was amazing—so much actionable wisdom and real experience. We’ll definitely have you back to talk more, maybe about custom product pages next time. Thanks to everyone for joining, and see you in the new year!

✨ This transcript was generated and enhanced by AI and may differ from the original video.