Adding Gamification to Loyalty Programs The Right Way

Adding Gamification to Loyalty Programs The Right Way

Loyalty is the name of the game for marketers today, since keeping a customer is 5x less costly than acquiring new ones, and nearly half of a store's revenue is created by only about 8% of their most loyal customers.

One of the most underrated methods to increase your customer by encouraging your customers to take specific actions with gamification. Gamification is the mixing of gaming activities that affect marketing and business strategy to increase customer engagement, improve sales, and brand loyalty.

In This Article You Will Learn:

  • Why Gamification Works Well for Customer Loyalty Programs
  • How to Gamify Your Loyalty Program
  • Successful Gamification Loyalty Programs
  • 5 Examples of Successful Gamification Strategies

Why Gamification Works Well for Customer Loyalty Programs

There isn't one perfect approach to a gamified loyalty program. Still, when done correctly, it has been established that gamification induces powerful emotions like excitement, intrigue, and happiness to influence specific actions.

As transactional deals - like coupons and percent-off discounts - have proven less and less effective, brands are beefing up their customer loyalty programs to set themselves apart and drive greater engagement. This is critical, considering that

  • 58% of consumers said they’re more loyal to brands than they were five years ago, but the majority of our Brand Loyalty 2020 report respondents.
  • 63% belonged to between one and three loyalty programs, meaning a program must deliver exceptional experiences to make the cut.
  • Also, 77% of consumers feel brands could be doing more to earn their loyalty.

Increasingly, brands are leveraging gamification or behavioral economics in these programs as a differentiator and a key component in the personalized, customer loyalty loop. Gamification requires using game elements or design techniques as part of your marketing strategy to influence customer behavior and engagement.

Brand retention and brand loyalty are changing constantly. Gamification loyalty programs have been executed in various different ways. Use your rewards plan to entice customers to always return. Take note of the five key steps to create a gamified customer loyalty program. Take advantage of these five key steps for your loyalty program to make it more engaging and addictive to your customer base feel more than ever since you have a loyalty program

How to Gamify Your Loyalty Program

Clearly Define the Outcome You Desire:

Different game design elements can trigger different outcomes and encourage loyalty you have to motivate customers to keep coming back. , A common way to do this is to develop multiple steps that allow them to collect points to redeem for rewards. And if your customers are interested in achieving goals, performance graphs and progress tracking tools could be the way to go.

Encourage Customers to Adopt Digital:

You need to go beyond asking a customer to download a mobile app or scan a loyalty card with every purchase. Using gamification to pair digital actions with making a purchase enables you to incentivize digital adoption and greater engagement with your loyalty program, while also helping them have a seamless experience inside a store and while online shopping.

Map out The “Storyline”:

The better a business loyalty plan is structured, the easier gamification will be. Remember, the game is fun only if the player understands how to play. Similarly, be flexible and provide instant rewards for signing instead of an incentive to sign up for a program you cannot afford to let people play on first. Rewards should be offered with each new benchmark a customer passes or each final ‘future reward.

Design with Revenue in Mind:

Just a 5% increase in loyalty can boost the average profit per customer by 25% to 100%. The combination of gamification and personalization can have a significant positive impact on customer lifetime value, which is an important performance indicator that provides a clear picture to show the C-Suite the ROI of loyalty offers, promotional programs, and marketing activities.

Use Social Media To Your Advantage:

Offer customers the option to share their rewards program status and Achievement badge on their socials. Create a hashtag to help increase awareness. Spontaneous rewards are also a great way to actively invite customers to promote your loyalty programs versus traditional marketing methods. Try including incremental awards that consumers aren't aware of. So when someone receives something, they are expected to be random and spontaneous. Utilize incentivized rewards to enhance your program.

Optimize Your Loyalty Program On Mobile:

One of the best ways to succeed with the stated points is to offer your loyalty program in an online mobile app. Enticing side promotions like Scratch and Win competitions can be implemented immediately, with a connection sent to each customer in the loyalty program. Enticing your target audience with promotions like Scratch and Win competitions are easily implemented through Push Notifications or Automated Texts or Push Notifications.

Successful Gamification in Loyalty Programs

Some of the most effective marketing happens when consumers are so engaged that they don't realize they're being marketed to. That's why many successful brands have turned to gamification or behavioral economics. It can better engage customers in fun ways, and in the process, enable brands to build loyalty and increase sales.

Gamification isn't a new tactic. Remember McDonald's Monopoly game? And there was United Airlines, which debuted the industry's first modern frequent-flyer program. Today, though, brands are using behavioral economics in more subtle ways to personalize offers and strengthen the customer loyalty loop.

Built-in systematic ways, gamification is part of a marketing strategy that relies on science to motivate and influence customer behavior. Doing this allows brands to create rewarding experiences that play into their customers' competitive spirit while delivering valuable information that enables the brand to develop 1:1 personalized offers that will translate into revenue.

There are many examples of successful strategies. Consider what these five brands have accomplished.

Starbucks has seen great success incorporating gamification activities as a fun and interactive way to improve customer engagement with their loyalty rewards. For example, when consumers use Starbucks' loyalty program, it will reward customers with gold stars if they order a glass.

Nike is another brand that optimized their loyalty program Nike+ with gamification to help encourage loyal customers to keep track of their progress towards specific goals and encourage more to use their loyalty incentives.

5 Examples of Successful Gamification Strategies

My Starbucks Rewards - In its quest to become the most personalized brand in the world, Starbucks Corporation launched this reward program, which gives loyalty program members gold stars each time they pay for purchases using their mobile app. The more they buy, the more stars they rack up and the higher levels they achieve. Customers can earn them a customized gold card and other cool benefits. Not only are members earning stars for purchases, but the rewards program also guides customers into their own individual journeys to onboard more easily, increase buying frequency and learn about new products. By leveraging artificial intelligence and machine learning to power the customer insights for gamification and personalization, Starbucks has been able to increase its marketing efficiency by 2x and speed marketing execution by 10x.

Source: Starbucks

Target's Wish List - This app-enabled children to create interactive shopping lists during the holiday season. Playing a 3D animated game, kids visited the Target Toy Factory and could drag and drop desired toys to create a wish list that would then be sent to Santa. The Wish List's initial launch saw 75,000 downloads, with 100,000+ wish lists created. The lists included 1.7 million items, which represented a total sales potential of $92.3 million.

NikeFuel - Combined with a wearable fitness device call the Fuelband, the app enables users to share fitness achievements on social media. Users can also earn points, enabling them to compete with each other. The objective is to have the Nike brand integrated into consumers' everyday life, and be associated with healthy, fit lifestyles. Within the first year of its introduction, Nike attracted 11 million Fuelband players using the app.

Source: SearchEngineWatch

Chipotle - The fast-food giant has used games in numerous ways to engage its customers and reward them with free goods in the process. About five years ago, Chipotle introduced an avocado-themed matching game called Guac Hunter, which rewarded winners with free guacamole and chips. The next year, Chipotle debuted an animated short film entitled "A Love Story." This spawned another matching game, focused on identifying real Chipotle ingredients compared to others that had artificial flavors or added colors. The game highlighted Chipotle's use of fresh ingredients and awarded winners with a "buy one, get one" free burrito promotion. These games enabled Chipotle to highlight new offerings and its competitive advantages while driving loyal customers to its restaurants to redeem rewards and make additional purchases in the process.

Source: BusinessWire

M&M's Eye Spy Pretzel - Designed to raise awareness of its new pretzel-flavored candy about a decade ago, M&M's launched a simple and inexpensive, but effective, marketing campaign that centered on an eye spy game. Shared on social media, the challenge was to find the pretzel in an image of M&M's candies. In addition to providing a fun and easy way to engage with the brand, M&M's saw its social profile spike - adding 25,000 new likes to its Facebook page, as well as 6,000 shares and 10,000 comments.

As brands look for alternative loyalty solutions to customer retention, they need to consider new ways to engage with customers. Gamification in marketing is an effective tool that not only strengthens bonds between brands and consumers, but it can also help drive NIR to understand the effectiveness of marketing efforts to increase customer retention, grow sales and revenue dramatically.

Interested in learning more? Download the new white paper, "Beyond the Fun, Gamification Adds Science to Your Customer Loyalty."

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