Gamification – a billion dollar retail opportunity disrupting loyalty, achieving successful omnichannel customer engagement

As retailers navigate the ongoing pressures of inflation, changing customer behaviour and increased competition around price, identifying strategies to engage and secure their customer base is becoming more and more challenging. For a number of years now, providing an omnichannel experience for shoppers has been a key opportunity for retailers to engage customers in a seamless way, making their journey as frictionless as possible, building loyalty and ultimately increasing sales.

As retailers continue to focus on digital transformation, connecting the dots and providing a seamless experience for their customers is indeed critical. A successful strategy and the engagement mechanics which support this should be channel agnostic, with the focus always remaining firmly on delivering a great customer experience.

According to global market research source Research Live, 90% of retail leaders agree that a seamless omnichannel strategy is critical to their business success. Meanwhile Google has reported that 30% of omnichannel shoppers have a 30% higher lifetime value than those who shop only using one channel. These findings are backed up by a Harvard Business Review report highlighting how customers will spend more money for every additional channel they use.
Providing a unique gamified experience across all channels, including online, digital or in-store, offers many retailers and brands a highly effective tool to help them achieve that seamless customer experience.
Gamification is quickly taking the global retail sector to new heights. With the value of the global gamification industry set to reach $30bn by 2025, according to Markets and Markets, retailers are increasingly keen to get a share of this opportunity. With its use in the retail sector accounting for the lion’s share of this growth, a report by Research&Markets (R&M) forecast a 25% compounded annual growth rate in gamification between 2020 and 2025. This provides a significant opportunity for retailers across the UK and globally.

So, how do you deliver a seamless and compelling gamified customer experience?

1. Provide instant gamification opportunities across all channels to enable customers to engage regardless of which channel they chose to shop across. M&S do this well with their Sparks programme offering their loyalty customers the chance to get the shopping they are buying free, whether purchasing online or in store.

2. Ensure a frictionless experience with the gamification mechanic embedded in the shopping journey. It is important that the game doesn’t result in additional time (either at till or online checkout), with a simple payment/redemption process for winning baskets/shoppers.

3. The value exchange for the shopper is simple and clear. Whether collecting email addresses, encouraging a purchase or asking the shopper to engage in brand content, it is important the messaging on the potential reward is clear. The bigger the reward and the greater the opportunities to win, the easier it is for the shopper to make the decision to engage.

4. Provide a true channel agnostic, omnichannel experience for longer term engagement gamification mechanics. This means that whatever action the shopper takes over whichever channels they shop across, will be noted and count towards the end goal.

5. The experience is visually engaging and simple to complete. The Lidl Scratchcard via the app is a good example of this. The scratchcard operates using your finger and provides a 1 in 5 opportunity to win a prize. Easy to use and providing a moment of excitement for the customer.

6. Show shoppers their progress, creating a feeling that the end goal is near. Providing a balance of ‘wins’ or ‘rewards’ received can further engage an audience and drive commercial benefits. When deployed well, this approach can incentivise customers and keep them coming for more.

By using modern forms of gamification, retailers are finding they are better placed to engage consumers, build brand loyalty and enhance the overall retail experience. Unsurprisingly, Gen Z is particularly engaged with this mechanic. According to Tapjoy, 77% of Gen Z’s are currently playing mobile games daily. As grocery retailers are keen to build loyalty with this and other segments of the population, it is essential to deploy the right strategy to deliver great results.

The key to success in gamification lies with the development of an engaging and thoughtful platform seamlessly connected with the retailers’ shopping channels. It must stimulate customers, offer an enjoyable, uplifting experience, and reward them. Getting this right will encourage increased spend (and therefore, sales) and greater brand engagement making the omnichannel gamification experience a ‘win-win’ for both retailers and their customers. Those brands and retailers that get this right will better connect with consumers and, as we have seen with many of the examples highlighted above, ultimately grow their sales.

Premal Patel, Managing Director at Catalina UK, the leading global customer activation business working with some of the UK’s most prominent retailers and brands.