The ability of a business to retain customers, rather than always trying to acquire new ones, can be the difference between the company surviving or going to the wall. Sixty-six per cent of businesses have no fundamental understanding of customer lifetime value (CLV). With the economic challenges facing many companies, understanding and building customer loyalty and engagement is essential in today’s environment.

Alex Lawrence writing in Forbes in 2012, quoted figures from Bain and Co indicating that a 5% increase in customer retention can increase a company’s profitability by 75%.  Gartner Group advises that 80% of a company’s future revenue comes from 20% of its existing customers. While these figures may be nine years old, they are still as applicable in 2022 as when Alex quoted them in 2012.

In fact, creative marketing strategies to build customer retention and engagement are even more essential in 2022. Companies and brands compete more fiercely for customer attention, engagement, and loyalty, while potential customers are using more strategies to avoid advertising. The 2019 Edelman Trust Barometer Report: In Brands We Trust, found that 3 out of 4 respondents were using one or more strategies to avoid advertising, such as using ad blockers, and 39% had managed to avoid all advertising. The definition of advertising has also expanded to include referencing sponsored TV and radio ads, sponsorship of events and teams, product placement and branded messages in social media or digital/print magazines.

The consequence of these challenges is that it is increasingly challenging for businesses to communicate their brand assets using conventional channels and get a share of consumers’ attention [1].

Gamification marketing has become an engaging way of bridging the gap between consumers and brands, tapping into the human instinct of playing. It creates positive experiences that build brand awareness and drive loyalty and conversions [2].

WHAT IS GAMIFICATION?

Gamification integrates game processes into a system, product, or service to motivate users to achieve a task. In business, gamification marketing is simply achieved by making business activities fun by turning them into a game [3].

Gamification uses game-related elements and principles in non-game situations to attract customers and increase engagement and retention [4].

WHAT are the benefits of gamificatioN?

Some of these benefits have already been mentioned. For example,

• Gamification bypasses the definitions of advertising by customers; hence, it is not likely to be blocked by people who use ad-blocking techniques. Compared to video advertisements, games can have up to a 181% higher click-through rate, with customers being 2.2 times more likely to enter their details at the end of a game. Brands can promote themselves through Gamification Marketing and achieve set objectives, knowing they’ll have trackable analytics [5].

• It appeals to people’s sense of fun and the desire for pleasure and reward innate in everyone. Game mechanics make it fun for customers to use more frequently. The result is more engagement and more revenue.  Also, users are seven times more likely to value and use said reward over a generic handout [6].

• One of the other benefits of gamification is that it is one of the fastest-growing markets, with expected revenue of $30.7 billion by 2025. In 2019, the global gamification market was assessed at $7.98 billion [7].  This is due to factors such as increased usage of mobile devices and the integration of social media, which allows users to share their experiences with their friends.

UNDERSTANDING THE MOTIVATORS FOR GAMIFICATION

When considering gamification and how to encourage customers to be active with your brand, it is vital to understand the intrinsic and extrinsic motivators that drive people. 

INTRINSIC MOTIVATORS

Intrinsic motivation is the personal desire to keep playing, mastering, exploring, or otherwise enjoying the world of a game. Intrinsic motivation comes from within the person rather than extrinsic factors, which are external to the person.

Examples of intrinsic motivation are the quiet happiness and satisfaction the person receives from engaging with the game. Players following intrinsic motivators often feel like they are participating in something worthwhile and uplifting. Usually, this is closely twinned with creative urges. Intrinsically motivated players could be described as enchanted rather than retained. They are the most likely player to promote a marketing story [8].