2023 has turned out to be an interesting year when it comes to driving online sales for e-commerce brands. Budgets have mostly stayed the same and, in some cases, have been reduced.
As a result, e-commerce marketers need to be strategic about how they engage consumers in the coming months.
In this blog, we examine the role of gamification for e-commerce brands to drive online sales and increase average order values in an era of rising costs and shrinking budgets.
Changing the game for e-commerce brands
We’ve covered gamification in recent blogs because its sharp rise in popularity is just something e-commerce brands can’t afford to ignore.
Why?
First of all, it helps overcome issues like ad-blocker and privacy concerns, helps reduce basket abandonment, and the need for returns… Plus, it helps you to stand out with a unique and interactive experience to the abundance of competition.
Ultimately, e-commerce campaigns that are supported by gamification see better engagement rates, better conversion rates, plus increased revenue and ROI. In fact, it often out-competes other marketing strategies altogether.
For instance, gamification can:
- 📈Increase engagement rates by up to 50% (Marketo)
- ⬆️Improve customer acquisition rates by up to 40% (Forrester)
- 💸Increase sales and revenue by up to 15% (Gartner)
The success of e-commerce gamification is largely because individuals are disengaged with traditional marketing. Consumers want fun, interactive, and more personal communications.
Case in point: By motivating consumers to take part in games like “spin to win”, leaderboards, and more, e-commerce brands can boost satisfaction, customer loyalty, and retention.
So, let’s look at how exactly gamification enables you to drive online sales and increase AOV.
5 ways ecommerce gamification boosts online sales
If you don’t want your e-commerce brand to look like everyone else, don’t follow the same rule book. Be different. Be daring. Try something new and engaging and see where it leads you.
With this in mind, we’ll jump straight into some of the benefits of gamification for e-commerce brands:
🚀Boosts customer engagement: Through interactive marketing campaigns, consumers experience a more fun shopping experience thanks to their human psyche wanting to feel like they’re winning. That’s why badges, points, and reward systems are popular and can encourage consumers to spend more time browsing… And encourages them to buy.
📣Creates FOMO: By adding a sense of urgency, for example with limited-time offers like flash sales or countdowns, consumers are encouraged to purchase sooner and get the good deal – before the opportunity passes.
❤ Rewards repeat visits: If your gamification campaign encourages consumers to return, through personalised marketing or a discount as part of their win, you’re obviously going to boost sales. And discounts ‘won’ are x2 more likely to be spent!
👍Promotes social sharing: Some campaigns, like leaderboards with prizes, go viral and the brand awareness from that skyrockets customer acquisition.
📈Raises Average Order Values: We’ll go into this in more detail later. But, essentially, gamification can incentivise adding additional items to shopping carts.
Ultimately, gamification creates a more engaging and even personalised shopping experience.
So let’s look at some techniques in more detail so we can see how an ecommerce gamification campaign takes shape.
Top gamification techniques used by leading e-commerce brands
Leading e-commerce retailers like Nike, Starbucks, and Sephora use gamification techniques to drive online sales. But what are some of the techniques they use?
Common gamification techniques include:
- Instant win game mechanics: Offering customers the chance to win a prize, such as through a ‘Spin the Wheel’ or scratch card, can create excitement and urgency as consumers try their luck.
- Interactive quizzes: This could lead to product recommendations, which helps reduce returns and gives you first-hand insight into their preferences. It can also create a more personal and less stressful shopping experience as customers can ‘try before they buy’.
- Badges: As part of a loyalty programme, customers could collect badges or rewards during online games for actions like making a certain number of purchases or referring a friend.
Let’s be honest: we all want to experience some sort of reward for loyalty. And when we do experience it, we tell our friends and family about it. This is what makes gamification so powerful in a saturated retail market.
But before we move on, there are other more basic gamification techniques directly related to the final step of the buyer cycle – purchasing – that actually close sales. For example:
- Free shipping: Tons of stats out there show one of the biggest causes of basket abandonment is the shipping costs – and also delivery times (e.g. wanting it next-day). With spending over a certain amount guaranteeing one of both of these things, the consumer is more likely to top up their basket and you see AOV increase.
- Product bundling: This gamification technique offers customers a better value proposition. It groups related products together and provides a discount for the bundle to encourage additional purchasing. It’s a win-win because the customer also gets a tailored recommendation.
- Personalisation: Using previous browsing history, purchase history, and first-party data captured through gamification campaigns (covering current preferences) – e-commerce brands can create more personalised experiences. This can be anything from email campaigns through to interactive website product recommendations.
But how do leading brands put this into practice? Now, let’s look at those brands again for examples of gamification in action:
>> Penhaligon’s – The perfume specialists cleverly use an interactive web-based experience to provide personalised scent recommendations to consumers.
>> eBay – The outbidding element to eBay causes people to spend more time on-site and competitively raise the purchase price of goods.
>> Nike – They use gamification elements across the entire brand. For example, NikePlus provides personalised product recommendations, as well as challenges and offering rewards for hitting fitness goals.
>> Peloton – Slightly outside of e-commerce, this fitness provider provides freebies when members hit fitness milestones (like free T-shirts).
>> Sephora – This beauty retailer has loyalty programs (like Beauty Insider) that allow customers to earn points for purchases, which can be redeemed for rewards.
>> H&M – This fashion retailer uses elements of gamification like spin-the-wheel games and scratch-card promotions to encourage purchases.
These are very light-touch in terms of detail, so let’s explore a case study in more depth.
🔍Case study: Matalan gains 4x higher customer engagement with gamification
Matalan – Using ‘wheel of fortune’ gaming elements to encourage customers to visit ‘The holiday shop’ range and undertake additional tasks, such as referring friends to the interactive game or following Matalan on Twitter.
The result?
- The click-through rate increased from 1.5% to 7%
- 17,000 people shared the game on social media platforms
- 80% of consumers said the prizes encouraged them to visit Matalan online or in-store
When done well, you probably won’t have even noticed that the brand has used a gamification technique. It just feels like a good user experience. And that’s how it should be.
Pitfalls to avoid with gamification in e-commerce
Whilst there’s an abundance of benefits for online retailers, like all things, it is possible to create a bad online shopping experience with gamification.
This can happen when it’s overused and becomes annoying rather than complementing a campaign. Or, there’s a bad design so it’s not intuitive. Worse still, there are technical issues like it freezing/glitching. This can be caused by poor integration.
Challenges like this are often caused when a brand doesn’t have the right resources – i.e. time, money, and dedicated specialists. Measuring the success of these campaigns relies on data and analytics. With e-commerce having high data volumes, making sense of big data is all too common.
Whilst this may sound like doom and gloom, it’s a reality that leading brands avoid by using gamification software. But beyond the tech, these specialists help brands with the planning and execution of gamification strategies to ensure they drive user engagement. And they can prove the impact and prove ROI if they have built-in analytics tools.
Key takeaways: Why gamification is hot for e-commerce brands
Some hail gamification as a motivational superpower. 🦸♀️🦸♂️
It’s proven to drive sales by providing better shopping experiences – whether that’s through virtual shopping, personalised perfume recommendations… Or obvious, yet simple, sales messages like refer a friend for a discount.
The key pull for gamification is that it provides more fun and personalised e-commerce that encourages additional purchases and repeat custom.
But it needs to complement the customer journey and not feel clunky, annoying, or glitchy. And it needs to feel like a value-exchange so the gamification strategy and the reward needs to be right for the target audience.
📕Further reading:
In previous blogs, we’ve provided tips to ensure you select the right gamification strategy for your audience and one that supports your business’s goals. You can read it here now.
Ready to compare gamification software providers, take a look at this checklist.
Or, book a demo today and we can talk you through how brands like Matalan use gamification software.