Chapter 4 of Loyalty 3.0: How to Revolutionize Customer and Employee Engagement with Big Data and Gamification focuses on gamification. Gamification sounds like it would be all fun and games (pun fully intended) but it is actually a much larger and useful aspect of customer and employee engagement and retention. The definition of gamification is applying aspects of a game to any other activity, particularly marketing. This comes in many different forms, but often finds itself in apps, making the companies rewards system like a game.
Some examples that the chapter mentions are RescueTime, FitBit, Mint and RunKeeper. These apps use gamification to motivate their users to continue to use their product, level up and more. FitBit, for example, uses gamification to encourage users to get more steps in than the day before, complete new fitness challenges or even try new activities that they may have not tired prior. “93% of marketers now use gamification to boost key metrics like engagement, conversion, and loyalty, highlighting its growing influence in the marketing world” (UseInsider, 2024).
The psychology behind gaming is similar to gamification. It goes back to the hierarchy of needs that tells us humans need to reach a specific sequence of needs. Gaming and gamification (completing tasks and leveling up in status) often fall under the esteem and self-actualization. These two are the feeling of accomplishment and achieving one’s potential areas. They are the “least important” on the list, as they are the highest on the triangle, but they are still a need.
“Another way that you can use this data to motivate people is to supplement the visualization with goals to work toward, real-time feedback as they progress, rewards for their achievements, and a community of people to compete and collaborate with” (Paharia, 2013, pp. 67). There are so many options for companies to use gamification in their rewards and app systems. Some stores use points to “level up” in status. This is where stores like Sephora, Aerie and more take their place. You can go from “bronze” to “silver” to “gold” to even more as they purchase more.
Games are intrinsically motivating, meaning we want to do better for ourselves. This goes into autonomy (I control), mastery (I improve), purpose (I make a difference), progress (I achieve) and social interaction (I connect with others). Each of these factors come into play when it comes to gamification. Most people have each of these intrinsic motivators within them. When marketers began to use gamification as a tool to get more customer and employee loyalty (plus higher retention), it was a game changer (again, pun fully intended).
Finally, Paharia argues that gamification’s impact is unlocked when paired with big data. The large-scale data we generate allows systems to personalize gamification mechanics: tailoring goals, feedback, and rewards in real time to each user’s behavior. I am looking forward to seeing how gamification changes in the coming years.
Insider. (2024, December 27). Gamification in marketing: The ultimate tool for boosting engagement and loyalty. https://useinsider.com/gamification-in-marketing/
Paharia, R. (2013). Loyalty 3.0: How to revolutionize customer and employee engagement with big data and gamification(p. 67). McGraw Hill. Kindle Edition.