Why gamification is the way forward for customer loyalty and loyalty programs
Many companies say they want to improve customer loyalty and say they want gamification, but it often turns out that they are looking for a game to use in their customer club or loyalty programs. They usually envision a simple game like shoot ducks, cans or hot dogs to earn points.
This is a typical "misconception" about what gamification is and a misconception about what drives loyalty, or not. Both contribute to the customer experience, which is valuable, but the game is a single factor while gamification is a whole "ecosystem" of factors in which the game can play a fun role. Gamification is also about making it "fun", but it is fun even when you do things that are not fun per se, or when you want to change behaviours etc. and not just when you play a game.
The same goes for the traditional "Pointification", where points are awarded per time spent. It is also a single factor that focuses only on spending, not on customer interaction, behaviours etc.
Here's why it's so important to engage the customer;
No one needs another loyalty program with points per spend and special offers every week. Such a program only leads to temporary sales, but not to long-term loyalty.
Here are 5 reasons to go the extra mile - from satisfied to loyal customers
- A loyal customer spends 6 times more money than a (merely) satisfied customer.
- 61% of customers are willing to spend more on brands that deliver a great customer experience (Gartner).
- 86% of buyers are willing to pay more for a great customer experience.
- By the end of 2020, customer experience will overtake price and product as the most important brand differentiator. (Walker)
- Only 20% of customers would say they are very satisfied with their customer experience. (SAS)
2 more points on gamification and loyalty
- Gamification vs gamification. It's quite easy to confuse true gamification with just cool design. That "easy" stuff can work for a short while but to drive sustainable change and long lasting effects you need to go deeper. That's why gamification that really delivers results is based on research, behavioural science and motivational design.
- Loyalty is like a living plant; it needs continuous nourishment. Loyalty is not something that can be established through project-like 'injections' such as a 'fun game'. Loyalty needs to be sustained and be part of a continuous work effort, it is not a project with an end date.
So if you want to increase customer loyalty, you can certainly add "games" as part of the customer experience - but I hope you understand that it's not enough all the way.
The complete gamification package at your service - At Insert Coin we have a research department, UX expertise, AI, lots of behavioral data, science and experience from highly successful loyalty programs. All in all, a wealth of knowledge and we're happy to share it with you.
Text originally written by Daniel Marcko, gamification expert at Insert Coin
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