by Jennifer Lonoff Schiff

How gamification improves customer engagement and retention

Mar 23, 2017
E-commerce SoftwareInternetMarketing

Marketing pros and business owners share tips on how to use gaming techniques to attract, educate and retain customers -- and sell more stuff.

gamification customer loyalty5
Credit: Thinkstock

“Engaged consumers have a significant impact on your bottom line,” says Alex Gault, vice president of sales and marketing, DeepMarkit. “According to Gallup, brands that successfully engage their customers realize 63 percent lower customer attrition and 55 percent higher share of wallet.” And a prime way to engage customers is by using games that reward them for playing – and shopping — with you.

[ Related: 3 enterprise gamification success stories ]

“By offering rewards to players as they achieve milestones within your game, you’ll encourage engagement, generating high conversation rates,” says Gault. “Competition is also a powerful driver of engagement, [with] scoring and leaderboard ranking [further] increase[ing] engagement.”

[ Related: 5 apps to gamify your personal and work lives ]

Here are seven ways your business can use gamification to drive engagement and increase revenue.

1. Attract new customers with contests, giveaways and rewards

To attract new customers to your business, offer them a first-time buyer reward, say a 10 or 20 percent discount on their first order, if they sign up or join your list. You can also offer rewards for referring new customers, increasing the reward for additional referrals.

Another way to attract new customers is to hold a contest or sweepstakes that requires entrants to provide their name and email address in order to play.

2. Use games to educate customers

For example, “imagine you’re a bank that’s looking to acquire new customers,” says John Findlay, cofounder, Launchfire. “Rather than creating ads that talk about how your bank [or financial service business] is different, create a [free] online game that challenges players to build a financial empire by making good investment decisions.”

To foster engagement, “nest branded messaging and relevant advice into [the] game so players learn more about your offering[s] as they play.” To further encourage engagement – and get players to open an account – offer some kind of “reward,” say free checking for a year, or a $100 savings bond for “winning” the game.

3. Promote a new product or service with a fun, informative game

“For example, a sports retailer might run a racing style game to promote their new running shoes,” says Findlay. “In the game they could offer advice about the right type of shoe for long distance running. Players could then apply that advice in the game to ‘run faster,’ earn more points and win.”

4. Reward (and retain) customers by having them earn points for shopping with you

“Instead of relying on [just] loyalty points to retain customers, use gamification elements to make it fun to engage with your [brand],” says Findlay. “For example, you could create a scavenger hunt style game where members have to find the daily deal. If they find it they earn an exclusive offer, like a coupon [or] extra loyalty points.”

You can also reward customers by giving them points for the more or more often they buy. For example, OpenTable, the restaurant reservation service, offers members a $20 gift certificate for collecting 2,000 dining points.

Another way to use gamification to retain customers is by “offering big-ticket items like paid trips or event tickets [for points],” says Dwayne Spradlin, CEO, Buzz Points. “Hosting a sweepstakes allows anyone who uses [your] product [or] service or is a member to be rewarded for their loyalty.”

For example, members of Buzz Points can enter the Buzz Points Honeypot Rewards sweepstakes for 50 Buzz Points. “Past winners have received all-expense paid trips to Austin for Austin City Limits Music Festival and New Orleans for Mardi Gras,” he says. And, “15 other contestants received prizes of Buzz Points that could be used towards purchases at favorite local businesses.”

5. Make sure games are easy to play and winnable

“Keep [games] simple and ensure customers feel that they have a good chance of winning,” says James Moir, Nectar managing director, Aimia. “Gamificiation is only going to engage customers [if] they can see a chance of getting something out of it.

“For example, we run swipe-to-win campaigns with a number of our Nectar partners. It is a very simple mechanic that rewards every customer, with the chance of winning a big prize,” he explains. “It’s simple, efficient and can be marketed broadly, which keeps existing customers engaged and reactivates lapsed ones.

“For example we recently ran a campaign with Sainsbury’s, where customers could win a points prize (from 200 to 5,000 Nectar points) when they spent over £10 and swiped their Nectar card,” he says. “The points were issued as a voucher, which they simply scanned the next time they swiped their card at Sainsbury’s.”

6. Make games mobile and social media friendly

“Mobile scratch and wins are a clever way to motivate customers to interact with your brand,” says Kate Atty, vice president of marketing, Clutch, especially as more and more consumers are using their phones to shop. “Using a link from a mobile message, you can direct the customer to a mobile web page with a virtual scratch and win offer. The customer can actually ‘scratch off’ the cover image to reveal a prize that that they can redeem at the point of sale or online.”

7. And don’t forget about social media

“Incorporating social sharing into branded games will boost your company’s social media presence,” says Gault. “With social games, players commonly choose to share their results on social media, particularly by means of a leaderboard. This behavior inherently expands your brand’s audience via each player’s friends, virally extending the reach of your brand identity to entirely new consumers.”

“As part of our rewards program, customers get rewarded for following us and sharing their experience on social media,” says Shiree Odiz, founder and head designer, Shiree Odiz. “We give 500 points for either a share or a like on Facebook, Twitter or Instagram. We also give 1,000 points on your birthday, and 5,000 for referring a friend. The most basic way to earn points is when you purchase, every dollar spent you get 1 point. These can be redeemed for coupons that range from $25 off when you collect 2,500 points all the way to $250 off if you collect 250,000 points.”