How gamification works to encourage customer loyalty

/ 3 September 2020

When a customer is made to feel like they are valued by a brand they love, they are more likely to spend an increased amount of time and money with them and become loyal customers. In fact, loyal customers are reported to spend 67% more than new ones. However, to achieve this, businesses have to find a fun way to build trust with customers that will both encourage and maintain their loyalty.

Through the use of gamification, corporations can offer rewards to customers who shop regularly. Doing this not only encourages customer loyalty but enables companies to capture more accurate shopping habits. This can help them to personalise future shopping experiences, further improving and encouraging their loyalty.

How does gamification work?

Gamification works by providing brands with the ability to build goal-oriented customer journeys, encourage certain behaviours, reduce hard sells and build relationships – something that is critical in wanting to grow revenue and earn customer’s loyalty.

It is not always necessary for you to create an actual game when using gamification; only the structure around the content needs to become game-like. For example, offering customers voluntary quizzes which are rewarded with redeemable points, badges or a higher ranking on a leaderboard when completed. By using these gamification mechanisms, it allows businesses to collect earned data as well as connect with customers in a more fun and engaging way.

By customers voluntarily providing their likes and dislikes through gamified methods, they’re interacting with a value exchange. The earned data can then be used by brands to help personalise shopping experiences, such as more tailored and relevant discounts in a newsletter. This gives the illusion that businesses are speaking directly to the consumer, enticing existing customers to shop more and become more loyal.

Encourage competition and offer rewards

One of the most utilised forms of gamification that dramatically encourages customer loyalty is reward programs. Most of us have experienced receiving ‘stamps’ on a paper or digital reward card when buying a coffee from your favourite cafe.

The use of rewards in gamification is an effective way to encourage customer loyalty and increase sales. The customer naturally feels more inclined and makes a choice to purchase from that specific store to receive their freebie, which, in turn, encourages their customer loyalty.

Similarly, exercise apps like Strava are fuelled by gamification. When users complete their exercise, they’re able to earn badges and show off their routes to friends. Here, gamification works by creating competition between users. When seeing friends appear higher on the leader board due to completing runs faster, customers are more inclined to regularly use the app, becoming loyal users and leading to an increased chance of upgrading to a paid membership to receive tips and better route suggestions.

Overall, through the use of gamification, companies can establish a deeper, more personalised connection with buyers which can be used to offer incentives that will encourage increased shopping habits, leading to better customer loyalty.

For help or more information on how 3Radical can provide gamification techniques can acquire and retain new customer, build loyalty and create long-term advocacy, please click here. 

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