Engaging customers through gamification and loyalty programs

This article is part of the CommerceLab Reference Library, a set of online business tools that provide introductory and background information to help educate those new to the areas we cover. 

Gamification and Loyalty Programs

Loyalty programs are nothing new. Companies have used them for years as a way to draw in new customers, encourage engagement, and provide special offers for repeat business. Travel rewards are perhaps the best example of loyalty programs at their finest. Air Miles and travel reward points credit cards are two of the most popular examples of customer loyalty programs coupled with travel rewards.

But even programs like Roll up the Rim from Tim Horton’s and the Monopoly game from McDonalds have been very successful with increasing business during these campaigns through gamification. They have used gamification and loyalty program elements to create a game with incentives for customers to increase the number of purchases they make. This leads to a deeper level of engagement and more frequent interaction with the brand.

In fact, McDonalds and Tim Horton’s have taken their gamified loyalty programs online. Tim’s now includes an online version of Roll up the Rim that allows customers to visit their Web site and spin a wheel daily for their chance to win prizes and accumulate points toward a bonus spin at the end of the campaign. Of course, customers are required to enter their email to access the online part of the game and can play on their computer or mobile device. McDonalds has also shifted its Monopoly game approach and now provides customers with codes to use on an online Monopoly board.

How to Engage Customers Through Gamification and Loyalty Programs

Why are loyalty programs a successful way to engage customers? Programs like Roll up the Rim and Monopoly bring out the natural competitiveness that exists within us as human beings. According to a post by Razorfish entitled The Rules of Gamification:

“Gaming is embedded in us as human beings. We’ve already seen the effects of applying game mechanics to individual marketing campaigns, to every loyalty program in existence, and to tons of Web sites…This is ‘gamification,’ and to make it work, there needs to be a focus on the very human benefits that makes games successful: challenge, recognition, tracking, competition, and cooperation.”

Successful loyalty programs that utilize gamification have the beneficial elements that people want in any game. They want the challenge of trying to win; they want recognition of their involvement in the program; to be able to track their progress; have multiple levels of competition; and want some level of cooperation or a social component.

When these elements are present to gamify your customer loyalty programs, companies can maximize the effectiveness of their loyalty programs and give their customers another reason to continually engage with their brand, visit their web site, and make more purchases.