12 powerful gamification best practices to revamp your retail loyalty program

Let’s dive into a rich selection of gamification best practices that you can apply to your loyalty program today.
12 powerful gamification best practices

What is gamification?

Mary Poppins described gamification quite nicely with her line:

“In every job that must be done, there is an element of fun. You find the fun and SNAP! The job’s a game.

The question is: how are loyalty programs including gamification in order to improve their performance and ROI?

Let’s dive into a rich selection of gamification best practices that you can apply to your loyalty program today.

It’s no secret that keeping customers long term makes is key to retail profitability. What if you could double or triple their current stick rate? What if you could get them to buy twice as often? Or increase their average ticket size in 20%?

How much more actual profit would that give your business? You do the math.

That’s why so many retailers have launched their own loyalty program in recent years. In our latest webinar with Forrester VP and Principal Analyst Mary Pilecki (replay available on demand for limited time only), we learned that as much as 73% of brands today have loyalty initiatives.

Loyalty initiatives

The problem with many of these programs is that they are basic, unimaginative loyalty points systems.

Do they work? Maybe!

But here’s a better idea:

Instead of ONLY trying to entice customers and loyalty program members with meaningless points that get accumulated “somewhere” and are rarely redeemed, get smart about making your loyalty program truly engaging.

To do this, refocus on your customer data. This data is going to tell you the real story behind unengaged and lapsing customers. Then, wherever applicable, start improving the engagement rate of your loyalty program members.

In this article, you will learn:

  • Start with the right setup
  • Tactic #1: Progress bars
  • Tactic #2: Badges, awards and certificates
  • Tactic #3: At-a-glance dashboard
  • Tactic #4: Checklists
  • Tactic #5: Leaderboards
  • Tactic#6: Competition awards or badges
  • Tactic#7: Loyalty points
  • Tactic#8: Surprise points
  • Tactic#9: Contests
  • Tactic#10: Tests
  • Tactic#11: Personality quizzes
  • Tactic#12: Social sharing
  • Use the right loyalty software

Start with the right setup

You might be eager to jump straight to the gamification strategies, tactics and examples, but these 3 initial steps will ensure that your next efforts truly increase your loyalty program’s performance.

Check your stats

Before we get into the meat of the article, take a look at your loyalty program statistics to find out what’s really going on in there.

Are your customers not signing up for your loyalty program? Are they signing up but not identifying themselves when making their purchases? Are they accumulating points but not redeeming their rewards?

Identify the warning signs to hone in on what exactly is the weak link in your loyalty program setup.

Some things to look out for:

  • Customers aren’t aware of your loyalty program
  • Customers aren’t interested in joining
  • New members are active at the start, but their interest quickly fades off
  • Customers are not reacting to your communication
  • Rewards are too difficult to attain
  • Customers aren’t redeeming their rewards
  • Customers are experiencing technical issues

The data will speak for itself.

Still, if you’re confused about why your program members aren’t engaging, ask them. Ask them to fill out a short questionnaire (no more than 2 or 3 targeted questions) so you can get this information.

If your company is not using a customer data platform, get on it! Customer data is key to develop insight and adjust your strategy and marketing spend. If you are working with Loyal Guru, the leading CDP and loyalty solution for retailers, you are in great shape.

Set goals

Obviously, your main goal is to get your loyalty program members to stick around and buy more, but that’s pretty broad. If you really want to reach that goal, break it down into smaller pieces.

Take the retail and customer data you pulled in the first step and decide what areas need improvement. For example:

  • If you only have 25% of identified customers, your goal might be to increase that to 60%
  • If your members are only redeeming 8% of your coupons, a new goal is to help them redeem 25%.

No matter what is your starting point, the name of the game is constant improvement. Your goals will keep your eyes on the ball.

Choose and implement your next gamification strategy

Finally, it’s time to find the best gamification methods to increase engagement.

Below you’ll find 12 gamification techniques that can be integrated with your loyalty program. Each are tied to different struggles your loyalty members might experience in their customer journey.

Use them to come up with an effective strategy for your retail loyalty program.

12 powerful gamification best practices to revamp your retail loyalty program

On-boarding and activation tactics

As a general rule, the more a customer engages in the first period after signing up to your loyalty program, the more committed and loyal he or she will be in the long term.

These initial tactics are meant to visually show your customers what progress they’ve made within your loyalty program.

These tactics tie well into tiered loyalty programs, but can also be applied in traditional loyalty points systems.

Tactic #1: Progress bars

If progress within your loyalty program is linear, meaning it has a start and a finish point, progress bars make a lot of sense. This can either mean a percentage bar to show customers how far they’ve made it in the overall process, or other ways of visualizing progress like in the image below.

Progress bars

Tactic #2: Badges, awards and certificates

For non-linear progress (like completing different actions within your loyalty program), badges, titles and certificates tend to work well.

With badges, each significant piece of progress can be recognized and celebrated, so members can see what they have achieved. You can also give cool names to your badges that are coherent with your retail brand.

Badges, awards and certificates

Bear in mind that badges are used differently from tiers. Tiers represent overall progress within your loyalty program, and give access to different member benefits. Badges are awarded for specific actions, and are a personalized recognition based on consumer behavior.

Tactic #3: At-a-glance dashboard

Another non-linear method of loyalty gamification is the dashboard display, where customers see their badges, awards or even progress percentages displayed all in one place within your app or customer portal.

If this progress dashboard is the first thing they see when they log into the app or customer portal, they will be reminded of where they are standing and how much further they can reach.

Tactic #4: Checklists

Checklists are extremely powerful, and many people have an immense pleasure when checking off items from their list. Use this hack in human psychology in favour of your loyalty program!

Offer your customers ways to engage with your brand that involve ready-made checklists and help them feel good about themselves.

Trigger the competitive nature of human beings

Competition can be VERY motivating.

If program members are lapsing, bring in some extra incentive to get them to keep coming back for their next purchase.

Keep in mind that it doesn’t have to be a high-ticket reward to be effective. I once drove 40 miles to pick up a free ice cream cone. Because, you know, free.

Tactic #5: Leaderboards

Leaderboards are definitely a great way to bring out the competitive side of your loyalty program members. After all, who doesn’t want to see their name displayed in honor?

Although our natural tendency is to make a big leaderboard that can showcase a ton of people, experts recommend keeping leaderboards small and elite.

Tactic #6: Competition awards or badges

This is a similar tactic to #2 on this list… and might even look identical in your loyalty program. The difference is all in how you choose to present it to your program members.

If you’re using badges or titles for progress tracking, the words you use might be something like “Celebrate reaching the next tier!”

If you’re using badges or titles to foster a bit of competitive spirit , you might lean towards words like “Can you collect them all?” or “Achieve the highest rank.”

Tactic #7: Loyalty points

Loyalty program points are a genius invention because they communicate real value in a way that’s not possible with other methods. When your members understand the value behind their points, they look for ways to maximize their point earning.

Check out this example of how customers can earn points for both transactional and behavioral interactions.

Earn points

Tactic #8: Surprise points

It’s really important that clients know what to do to earn points. But it is also cool to surprise and delight them with bonus points they were not expecting. Doing something they like but didn’t expect is a sure way to overdeliver.

Use this tactic in a period of low engagement to keep customers engaged and excited to continue earning points.

Tactic #9: Contests

There’s a reason why sweepstakes and lotteries are so popular, and this reason has everything to do with human psychology.

Running a contest inside your loyalty program keeps members excited about the possibility of winning a prize.

Tactic #10: Tests

Raising the bar for your loyalty program members means that you care about helping them achieve their goals.

Challenge their growth with pass-fail tests.

Pass/Fail tests add a bit of pressure to your loyalty program members, and serve as a reminder that behind only half-committed to their goals isn’t good enough to get results.

Ask your program members true/ false questions around a topic central to your brand, and score them for their answers. Combine this tactic with offering extra points or upgrading them to the next tier level to further encourage their engagement.

Harness the power of personalization

People want to feel special and to know that they matter, whether we are talking about close relationships or a relationship with a brand.

And when you can deliver a more personalized experience to your loyalty program members, they’ll value that you are paying attention to their interests and they’ll engage more frequently.

Tactic #11: Personality quizzes

Personality quizzes can be extremely insightful when they’re built properly, keeping your customers front and center.

While it can take some time and thought to design a valuable personality quiz that is coherent with your brand, you’ll see how it boosts your customer engagement.

Personality quizzes

Tactic #12: Social sharing

Humans are fundamentally social. It’s why most of us (even if we’re introverted!) tend to enjoy experiences more when we can share them with our friends.

Make your social sharing invitations more bold, more prominent – and even reward members who actively share the news about your brand, loyalty program or offers on social media.

Last but not least: Use the right loyalty software

Ok, so you’ve identified the areas where your loyalty program could benefit from gamification to increase engagement rates.

Now for the hard part: figuring out what technology you need to make it happen in your retail business.

A Google search will bring you a long list of loyalty management solutions, insightful articles about loyalty software and guides that help you decide what your company might need to effectively enable your retail loyalty strategy.

Have fun and take your time.

The best option, of course, is to use an all-in-one and retail-specific loyalty platform like Loyal Guru, that can integrate seamlessly into your current tech stack and make your loyalty program fly.

If you’re a retailer and you’d like to talk about any of the customer engagement strategies outlined in this article in more detail, then get in touch with one of our team – we’ll be happy to show you examples or talk through your brand’s unique challenges.

ABOUT THE AUTHOR:

This article has been written by Loyal Guru’s content team, together with Luis Martínez Villaroel.

Luis has over 8 years of experience in the SaaS industry. He is currently LATAM Regional Manager at Loyal Guru.