What does gamification mean for customer relationships?
Playing games is in our DNA; we cannot help but like it. As children, it's how we learn and practice engagement with our peers and adults. And as grown-ups, the corporate world is full of game-play techniques as we war-game and role-play our way through work. Airline pilots spend much of their time playing multi-million dollar flight simulator games. A word we are seeing more and more is gamification. What does this mean for the customer relationship?
So What Is It?
Gamification is the use and adoption of game techniques and mechanics in non-game applications to engage users and solve problems. While it has broad application in a number of fields, for example, education, brand building, and science, we are seeing some of the most rapid adoption and development in the management of the customer relationship, CRM, or customer loyalty.
There are elements of games that we are all probably familiar with. These include:
Potentially all of these have a role to play in the management, development, and delivery of the customer relationship.
Is This New?
Possibly not. It can be argued that much of customer loyalty is one big game, particularly the recognition programs offered by airlines and hotels, where customers earn coveted status and benefits from flying more and sleeping more. Check out any of the popular travel forums and you will find members displaying their elite status as proudly as any Foursquare mayor.
But programs also understand that they need to learn and do more. One of the most ubiquitous elements of games is to unlock new levels as the player progresses and achieves performance goals. This approach is starting to be lifted into customer loyalty programs where benefits and rewards can be "unlocked" as the customer reaches spend or performance goals. This provide a new, intelligent, and more dynamic mechanism for the customer to work that little bit harder. And with the widespread adoption of games and apps, the customer is fully familiar with the concept and is fast to adopt.
What About Rewards?
Traditionally, reward programs have offered their customers more tangible rewards, for example, free flights, electrical gadgets, and cash vouchers. These are great, but they cost money and sometimes take the customer too long to save up for. This can lead to disengagement. We are starting to see the appearance of games themselves as being used as rewards for points collection programs.
AeroMexico offers a game platform as part of its reward proposition including allowing members to wager their miles for additional rewards.
Gambling is not for every culture or jurisdiction, but there is no denying its appeal to consumers or for the reward program with the obvious economic benefits of burning off that point liability for as little as the cost of a server and a bit of electricity.
Just Rewarding Sales?
The introduction of virtual rewards, typically used in multi-player game environments, opens up the opportunity to reward non-purchase customer behavior and low-margin spend. Allowing new brands and verticals to move into consumer rewards, where cost, tracking, or margin has traditionally excluded them, for example, FMCG and media. Ifeelgoods is one example of a number of emerging platforms that look to offer digital rewards to a brand's customers.
An interesting convergence where loyalty, education, and gamification come together is from educational publisher Primary Mandarin. Their Mandarin Matrix, an online classroom that helps children to learn Mandarin, using games and loyalty techniques to motivate, reward, and encourage progress.
Where Do I Start?
Some ideas and pointers for getting started:
For a long time I was somewhat dismissive of games as being something of a niche activity with little mainstream consumer application. However, the numbers speak for themselves. Every morning, on my daily MTR ride, I make a point of counting the numbers and profiles of people playing games on the train. Niche it is not.
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Stephen Hay is Asia Pacific regional director for ICLP, the award-winning global loyalty and customer relationship management (CRM) agency. Stephen came into loyalty at Cathay Pacific when e-mail was still something that people in research labs used to send to each other and direct mail was still king.
ICLP works with some of the world's leading customer-focused brands, including Cathay Pacific, Mandarin Oriental, and Juniper Networks; looking to bring brands and customers closer together into a more mutually beneficial and more profitable relationship. Stephen takes a customer point of view on almost everything, not always universally popular, but proven time and again to be the basis for a sustainable, profitable, long-term relationship.
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Wednesday, July 23, 2014