GSummit SF 2014 - Achievement Unlocked: Gamification of Loyalty by Jeff Berry

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  • Our definition of Gamification: Use of game mechanics to push someone along the purchase lifecycle without rewarding transaction behaviour. Essentially, gamification is an engagement tool and not a purchase driver.

    Gamification is one of the many tools that exist within your customer engagement toolkit.
  • Gamification risks becoming that “shiny ball” that companies are chasing after without really thinking about how it fits into their overall engagement strategy. Companies are falling into the trap of a more=better mentality.

    According to Forrester, 84% of marketers had no plans to include games in their marketing efforts in 2011. 3 years later, we are seeing games pop up everywhere.

    Gamification should only be one part of your overarching gamification strategy. Don’t fall into the trap of gamification for gamification’s sake. It is not a one-size fits all solution and should be used with a specific goal in mind.

    In everyday life, time and time again, we see the mentality of more = better; but, more is not always better. Lets look at some examples…
  • You had a favorite TV show, Friends for instance. When Friends ended after 10 years, NBC created the spin-off Joey. Joey was cancelled after 2 seasons. More≠better.
  • Another example comes from the use of self tanner. Some color looks good, but I think we can all agree that the color orange does not.
  • Everything about 80s fashion followed the mentality of more is better
    More color
    More makeup
    Bigger hair (both men and women)
    Bigger shoulder pads

    Anyone who lived through the 80s understands that this was not a good time for fashion
  • The business world is not exempt from the mentality of more=better

    QR Codes are a prime example. We started seeing QR codes everywhere, even where they didn’t make sense. There are no blogs dedicated exclusively to stupid uses of QR Codes.
  • Lets not forget about the heavy handed use of PowerPoint animations. As just shown, more objects swirling around a slide will not make the presentation better.
  • I’m sure we are all at fault for overusing specific business jargon.

    The point is, don’t let gamification turn into one of these trends.
  • We’ve already seen successful companies make mistakes when it comes to gamification because they didn’t consider how it fits into their greater engagement strategy. They incorporated gamification for gamification’s sake.

    Zappos
    Elements of gamification
    Badges, points and levels appeared on customers profile page
    Created an interactive world for customers to discover
    Why did it fail?
    It had no point
    No communication around what the points, badges and levels meant or how they were attained
    No incentive for customers to explore interactive world as customers had access to the same products through regular site navigation

    Google
    Elements of gamification
    Users were able to earn badges through Google+ for reading articles through Google News
    Why did it fail?
    Google confused badges with value; unless badges provide value to the customer, the customer will rarely care to earn them
    The default setting was for the badges to be private.
    Upside: many people don’t want all of their reading habits to be made public
    Downside: doesn’t create any kind of competition or a leaderboard where you can compare yourself to those in your Google+ circles
    Google lost site of the customer experience and how their users actually use their services

    Marriott
    Elements of gamification
    Marriott launched a Facebook game called "My Marriott Hotel" to recruit employees for its management program
    Players select from an array of characters to play general manager and set up their own Marriott
    The game was to be rolled out in chapters; not surprisingly, only the first chapter when users designed their own Marriott Kitchen was released
    Why did it fail?
    They created a game that no one wanted to play
    Large investment targeted to a very niche audience
  • At LoyaltyOne, we are strong supporters of gamification and we regularly incorporate it into our engagement strategies. The trick is that we use it as one element of the engagement strategy.

    How we’ve used it:
    With our Associates
    With our Clients
    With our Customers

  • Gamification is used to motivate certain behaviour among our Associate base.

    Pass it On
    What is it? 
    Pass it on is an organization wide recognition program and platform for celebrating success. It is uniquely designed to engage, align and recognize employees.
    It’s a place where you can say “Thank you!” to associates across the organization for all the things that help us deliver on our Purpose – to enrich the relationships between companies and their customers.

    Why it works:
    The program provides a consistent approach to recognizing associates across all functions aligned with our strategic framework (Purpose, Power, Values) a tool that minimizes “management tax”, while being applicable to all geographies.
    The philosophy is to use a common currency, offer beyond cash compensation and celebrate and recognize associate success daily, quarterly and annually.

    Success to date:
    Within first month, there was 94% program activation and 6,273 recognitions were made
    After the first year, there is a 97% activation rate across 1400 employees in Canada and International geographies
    40% of the recognitions received are Applause (non-currency based). Although AIR MILES are important to associates they are not the core, primary driver for program engagement. Associates see tremendous value in receiving recognitions regardless is a reward is assigned to the recognition.  

    Move & Earn
    What is it?
    Move & Earn is a pilot program (running Jan 23, 2014 through to the summer months), designed in partnership by AIR MILES for Social Change and Human Resources
    Associates are rewarded for taking steps and for other physical activity
    Activity is recorded using a variety of devices

    Why it works:
    Not limited to a single device, although associates were provided with a FitBit
    Highly valued reward
    Allows associates to compare themselves to one another

    Success to date:
    641 associates enrolled in the first week of launch
    Information being used towards other purposes
    Developing new employee wellness programs for AMSC to sell to Sponsors
    Improving our own wellness offerings to LoyaltyOne Associates
    Contributing towards the development of new, innovative programs for the company

  • In our AIR MILES program, gamification is used to incentivize our Client’s front line staff

    Sponsor Swipe Incentives
    Front line staff are encouraged to ask for and swipe customers’ loyalty cards through incentive contests.
    By having individuals, stores or regions compete against each other for number of swipes not only does staff feel encouraged and recognized for their efforts, but sponsors are also promoting ‘ask for the card’ habits that drive better customer engagement at the same time

  • Gamification is used to motivate specific behaviour of our customers

    BrandLoyalty In-Store Promotions
    What is it?
    2 dominant program types
    Short Term Loyalty Programs
    A retail promotion whereby customers collect stamps
    The number of stamps or trinkets distributed depends on the amount spent.
    At certain thresholds of numbers of stamps, rewards can be redeemed.
    Instant Loyalty Programs
    A retail program in which customers get an instant reward based on the amount they spend.

    Features of Program
    Short Term Loyalty Programs
    As well as leading to a peak in turnover, a Loyalty Program can also build retailer brand equity in two ways: with the actual choice of rewards linked to the program concept, and with the way it’s executed in the marketing mix.
    High perceived value of rewards  Rewards focus around food and family, as well as offering the opportunity for an extreme discount
    Instant Loyalty Programs
    Focus on family; rewards particularly appeal to children as they offer a high degree of playability and collectability
    The promotions are topical, newsworthy and educational for kids, and are structured to create excitement and media hype

    Success of Programs
    Short Term Loyalty Programs
    Knife Program with Bilka
    Objective: Add value to the super/hypermarket channel to respond to the aggressive growth of discounters
    7.1% increase in market share, 7.4% increase in penetration, 5.6% increase in basket size during program period as compared to pre-promotion period
    Knife Program with Fetex
    Objective: Given that the #1 in market launched a price offensive, counter price with clear point of differentiation focusing on store experience and atmosphere
    7.4% increase in market share, 2.4% increase in penetration, 13.7% increase in basket size during program period as compared to pre-promotion period
    Instant Loyalty Programs (Trinket Program)
    Stikeez Program with LIDL
    54% say Stikeez is differentiating
    84% participation among families with children
    During the program period, resulted in 7% increase in market share, 2% increase in penetration, and 4.8% increase basket size as compared to before the program was launched

    AMRP’s Check-in Challenge
    What is it?
    A mobile game that ranks the number of Check-ins Collectors do at AIR MILES Sponsor locations against other Collectors each month
    The top 50 Collectors with the highest number of Check-ins will get a Check-in Bonus, 2x the reward miles they earned that month at the Sponsors they Checked in at.

    Features of Program
    Reward the customers place a high degree of value on
    Helps to make AMRP top of mind and helps to show the number of sponsors through which customers can collect AMRM

    Success of Program:
    During the promotional period, those who checked-in at a retailer’s location earned more points and made more frequent transactions than those who did not

    Reasons for caution
    In the long term, the check-in promotion didn’t boost engagement much more than just offering a check-in option without promotion.
    Those customers who responded to the promotion had higher numbers of check-ins in subsequent months but they didn’t earn any more points or make more frequent transactions.
    It is for this reason that we urge you to use other engagement tactics, and not to get too caught up with gamification
  • If you think of your engagement strategy as a pie, gamification should only be one slice.
  • If you don’t consider how gamification fits within your greater strategy, and you make it your entire ‘engagement pie,’ than your company risks feeling like this girl after a pie eating contest.

Transcript

  • 1. Achievement Unlocked: The Gamification of Loyalty June 12, 2014
  • 2. Gamification Defined
  • 3. More ≠ Better
  • 4. Spin-offs of your favorite TV shows
  • 5. Being too tanned Tans that have gone too far
  • 6. Everything about 80s fashion
  • 7. Inappropriate use of QR Codes
  • 8. Manage expectations In terms of next steps A few quick wins Take this offline Win-win situation Move the needle Skin in the game
  • 9. Manage expectations In terms of next steps A few quick wins Take this offline Win-win situation Move the needle Skin in the game Overuse of business jargon
  • 10. When Bad Gamification happens to Good Companies
  • 11. Our Approach to Gamification With our Associates With our Clients With our Customers
  • 12. With our Associates
  • 13. With our Clients
  • 14. With our Customers
  • 15. Gamification is one slice of your Engagement Pie
  • 16. Don’t make it the entire pie!