Do marketing games make you the winner or the customer? If you’re a marketer, you’ve surely heard the term “gamification”, and wondered how it might impact your business. Gamification taps into a universal human desire to play…and win. For a customer, it makes doing business fun.
In a way gamification has been a part of businesses far longer than we’ve been hearing this cool new marketing term. Most of us understand frequent shopper, or loyalty, programs. From carrying punch cards in our wallets to playing games to win a prize, we have been part of gamification programs. Loyalty “purchase” programs from airlines to coffee chains are good examples of how gamified marketing has been used effectively throughout the years. It’s simple— reward customers when they make a purchase, with the goal of enhancing loyalty, increasing customer spend and lifetime value. But a new form of gamified marketing takes it beyond the traditional “pay for play” approach. According to Forbes, on average, American households are enrolled in 29 loyalty programs, yet they are active in only 12. Jerry Epstein, Chief Executive Officer of Engaged Nation warns, “This 42 percent participation rate will continue to decline if retailers persist in presenting predictable, one-dimensional models that only reward customers with points and discounts for their purchases.”
Businesses must modernize their approach to gamification.
The science of motivation has advanced significantly in the past two decades, but many loyalty programs haven’t kept up with those advances. OfferCraft’s Vice President of Marketing & Public Relations Dan Grech sees that changing and notes, “Recent advancements in technology are making it possible to have loyalty programs where members can get incentives that are far more customized to their tastes. My company is taking that one step further by incorporating artificial intelligence into those programs. This allows a company’s rewards to change and evolve depending on the preferences and behaviors of every customer. This makes those rewards far more appealing and their loyalty programs far more effective.”
When the customer wins, the company does too.
Built on the theme of a classic board game, McDonald’s Monopoly promotion is probably the most widely recognized example of gamification. Customers collect game pieces during restaurant visits, to win various rewards. “The genius in this program is that it supports the business goals of driving repeat visitation and additional purchases in a fun and engaging manner,” says Epstein. He adds, “Another good example of gamification is the Walgreens Steps and Balance Rewards program which they designed to reinforce their market position around healthy living. It recognizes and rewards members who increase their physical activities, acknowledging their desire to improve their health.” Programs such as Plenti – which is available locally – increase the value of your everyday purchases beyond the walls of a physical store with discounts at the gas pump. “These are good examples of the new “win-win model” that rewards both the customer and retailer,” adds Epstein. “The key is to develop a program which resonates with your particular audience.”
Gamification isn’t just limited to retail and travel. Grech recounts, “We worked with an energy company looking to promote a rate plan that was better for the environment. They sent their typical email talking about the benefits of switching. In addition, they sent a gamified version of the email that invited customers to participate in a fun interactive experience. The gamified email doubled the click-through rate and drove significantly more people to switch.”
“Another example comes from healthcare,” continues Grech. “A specialty clinic used gamification to cut their no-show rate nearly in half, from 50 percent to below 30 percent. Patients were invited to play a wheel spin game at the end of one appointment to win a cash prize they could only collect when they attended their next appointment.”
Human resources fun and games.
Fun inspires customers to engage. Grech sees this as also true for a company’s internal communications. “Studies show that, with turnover rates on the rise, enjoyability is an increasingly important metric in the workplace,” says Grech. “Many companies have identified a need for better employee engagement, and they find a solution in gamification. They use game elements and prizes in on-boarding and training, to make boring or unpleasant (but important) tasks more enjoyable. We saw one company increase survey response rates by 500% by incorporating prizes. Another company saw a spike in employee of the month nominations when it put a game on the company intranet. A third improved the outcomes of its smoking cessation program by replacing the paid 15-minute smoke breaks with social gaming sessions. The possibilities for HR are just endless.”
How to get started.
Epstein advises a test to get started. “You don’t need to jump into the deep end of the pool to start; testing a program or product is a great way to see what works. First, create a well-thought out campaign that makes consumer participation fun and relevant while providing a tangible return.” This can be done in the traditional way with, for example, the inexpensive punch card. You can also take your game to the next level by structuring it in such a way that customers can win a reward or discount before they make the purchase. This approach can often make the pain point of paying more fun. In turn, that experience will reflect positively on the company, product or brand and adds additional perceived value. “Your game could also include a chance to win something of much greater value, such as a gift card or shopping spree; adding this additional level of reward increases the enjoyment factor of the overall experience,” adds Epstein. Execution of these types of programs varies widely, from electronic games supplied by a “gamification company” to the old school way of picking a winning prize or discount out of a hat. Whichever method you choose, even engaging contestants to pop a balloon with a secret prize inside, can be an inexpensive and effective way to test programs of this nature.
If you’re going the route of partnering with a gamification company, Grech advises, “Find a good partner. If you don’t know what you’re doing, it’s easy to mess this up. You can’t just throw a game into a marketing or internal communications piece and hope for the best. There are plenty of companies that tried that but ended up creating games that weren’t fun, games that were too hard to maintain, or games that actually annoyed the target audience.”
As with any marketing program, the direction you choose must be able to live in your marketing environment, be sustainable and scalable.
A shortened version of this column appeared in the November 2017 issue of Biz New Orleans.