Gamification — Engage Your Customers with Fun and Games

Achieving customer loyalty is more difficult than it has been in the past. New services, new competitors and a better–informed consumer have made customers much more demanding. Some companies understand these new realities and are bonding with their customers using new strategies that achieve deeper customer engagement.

One of these new strategies is called Gamification.

The fundamentals of gamification - offering rewards and incentives to drive behavior - are not new. Loyalty programs have long been built around points, discounts, miles, rewards, etc. But today's look–a–like programs often fall short of their goals - to retain and grow a loyal customer base. Nonetheless many companies still embrace loyalty programs that feature traditional "earn and burn" formats.

Gamification is different because it uses powerful game elements to connect with and engage audiences. Using new technologies (also known as "funware") and the power of social networking, gamification techniques challenge and motivate customers through competition, recognition and rewards.

Gamification may not sound novel to members of frequent flier or hotel loyalty programs who have strategized for years about ways to game extra points. But those kinds of membership programs offer concrete rewards like upgrades, free flights or free hotel stays. What's new about gamification is its goal of motivating people with virtual awards that have little or no monetary value. It's deepening the engagement and exposure to the brand through something that has intangible value. Wow.. gamification offers a powerful marketing strategy to hospitality companies for little or no cost!

For example, InterContinental Hotels Group has added interest to their loyalty program with a daily online trivia game which awards people with the quickest, correct answers with free miles - the first loyalty program to do so. The "Win It In a Minute" program was created to improve loyalty among younger consumers - a group known for its lack of brand loyalty.

The dynamics of gamification can also be applied for other purposes. Because the dynamics of gamification are highly transferable, they can be applied to achieve many different goals: to create viral PR and buzz, increase loyalty or compliance, crowdsource new products or solutions, gain feedback, recruit talent, etc.

Marriott has taken a different approach with its new Facebook game that introduces prospective employees to the hospitality industry. MyMarriottHotel allows players to take on the role of a hospitality manager in the kitchen, where players must cook, buy supplies, and get dishes to the counter. At the top of the game is a "Do It For Real" button that takes you to Marriott's career site. The business goal of the game is to fill 50,000 positions at Marriott chains around the globe.

Tripadvisor recently launched a new program that adds reviewer levels depending on the number of reviews you publish on their site. For example, the status of "Senior Reviewer" is given when 6–10 reviews are posted on TripAdvisor. Star badges with difference colors are displayed with the user's profile. This approach to gamification drives more postings and can help readers make better judgments about the credibility of reviews.

One element common to many of these approaches is a "community" dimension. Traditional loyalty programs are not inherently social. Now, programs that share a person's individual achievements with others add a powerful social dimension to otherwise simple games. The key social component of "status" acts as a strong motivator that gets people engaged. Status can be broadcast and people are willing to work very hard to build that status through loyalty tasks.

The use of gamification to turn loyalty programs into enjoyable and social online experiences combines technology and motivational psychology, leveraging people's fundamental needs for achievement, reward, status, competition, and self–expression.

It's fairly simple for an existing loyalty program to gamify their program. For example, awarding badges for doing program–related activities and then displaying the patches in the customer's profile on the program website can promote competition and increase customer engagement.

Brands are ramping up the social capabilities of their websites, giving away virtual points and merit badges and using other "game mechanics" such as leaderboards, ranks, and avatars to engage customers.

Starwood recently partnered with Foursquare to begin offering members of the Starwood Preferred Guest (SPG) loyalty program additional points, badges and rewards for their checkins at participating hotels. SPG members who check in frequently at Starwood locations may be anointed as the "SPG Mayor." Each month, Starwood will declare the member with the most checkins across all its properties as the SPG Mayor. Mayoral duties will include sharing favorite insider travel tips and destination hotspots with fellow frequent travelers around the globe.

All of these gamification efforts are designed to provide a constant stream of motivation to keep participants engaged. In the near future, consumer loyalty programs will enhance their appeal with fun and games rather than expand the "earn and burn" formats we know today.