Level up your Loyalty-Program

It also works both ways! Through entertaining elements and experiences, customers are motivated to achieve specific goals and constantly engage with the brand or company. Customers interact with the brand and the company and thus become more loyal to the brand. So those who offer their customers fun incentives as part of a customer loyalty programme can increase their engagement and, therefore, their loyalty. At the same time, companies benefit from rich data and valuable insights.

At the same time, the targeted use of gamification elements can boost engagement rates, as reward-based behaviour encourages customers to invest more time in the brand experience, to regularly monitor and improve their own progress, thereby driving repeat purchases and interactions. The use of gamification in loyalty programmes therefore enables customer engagement that goes beyond mere transactions. For example, social media contests can offer incentives to be active on social networks, to create and share content there, or to take part in quizzes. In this way, retailers gain better insights into their customers’ behaviour whilst also receiving user-generated content.

Millennials and Gen Z, in particular, not only expect tangible rewards but simply enjoy gamification mechanisms: for example, 27% of the millennials surveyed stated that they were highly willing to remain part of a loyalty programme that includes competitive games (Colloquoy). Furthermore, they are not only interested in being rewarded for purchasing specific products and services, but also want a rewards structure that recognises brand engagement.

What exactly can gamification look like within loyalty programmes? There are various ways to set up a gamified loyalty programme, such as tier levels, badges, challenges and competitions. This creates a competitive environment for customers, encouraging them to make progress. This can motivate customers to use certain products or services on an ongoing basis in order to make progress and earn specific badges, which can then be redeemed for attractive benefits and rewards.

In mini-challenges and competitions, tasks must be completed within a set time limit in order to reap the benefits. Once the time limit has expired, everyone who has completed their tasks receives a reward.

Fundamentally, companies should ask themselves what their target audience’s preferences and needs are, and whether they are currently engaging actively with their brand at all. Anyone wishing to use gamification as part of their loyalty strategy should therefore, first and foremost, understand what makes their target audience tick, in order to prevent customers from quickly becoming bored and dropping out.

In doing so, the interaction goes beyond mere transactions and creates fun and experiences that foster an emotional bond between the customer, the company and the brand. Those wishing to incorporate gamification into their loyalty strategy have various options: for example, tier levels, badges, challenges and competitions can be used effectively to increase customer engagement and to incentivise and reward desired behaviour.

The integration of gamification elements into the right loyalty strategy is made easier by the increasing use of modern and flexible e-commerce architectures. By choosing suitable modular building blocks within the framework of composable commerce, companies have more opportunities to optimise the user experience and improve customer loyalty. The overarching goal remains a personalised and seamless end-to-end user experience, coupled with maximum flexibility to respond specifically to individual customer requirements and foster customer loyalty in a variety of ways.

If you’d like to explore this topic in more depth, take a look at our white paper “More than just a loyalty card: Six steps to a successful loyalty programme”.