Why use gamification in ecommerce?

insights  May 11, 2018

Customer loyalty is of great importance for ecommerce retailers. It costs a business about 5-25 times more money to acquire a new customer than it does to sell to an existing customer. In addition, existing customers spend 67% more than new customers[1]. Due to increasing competition and higher customer demands, retaining existing buyers has become one of the key challenges for ecommerce. By using gamification customer’s loyalty can be increased and existing buyers retained.

By shifting the focus from price to experience, the intrinsic motivation is influenced, and customers will be more inclined to stay loyal

What is gamification and why implement it?
Gamification is the application of game thinking and game mechanics to non-game contexts to affect behaviour. Its purpose is to use people’s desire for competition, status and achievement to drive desired behaviour[2]. This is done by responding to the intrinsic motivation. Gamification contains various elements and the most important of these are challenges, progress bars, competition, rewards and fun.

Many loyalty programs focus on the price and in particular on offering discounts for regular customers. However, when customers can get the product elsewhere cheaper, it is easy for them to switch. By shifting the focus from price to experience, the intrinsic motivation is influenced, and customers will be more inclined to stay loyal.

Examples of gamification in ecommerce
Examples of the application of gamification strategies in ecommerce include among others; scavenger hunts, price bidding systems and loyalty points systems[3].

1.            Scavenger hunts
Scavenger hunts can be a creative and fun way to involve consumers in the website or brand. The intention here is that the consumer locates objects on the website. When these objects are found, the consumer earns a reward. This ensures that consumers view multiple pages and products on the website. Companies that have implemented scavenger hunts on their websites are Bonobo and Wayfair.

2.            Price bidding
Price bidding is the principle whereby consumers can bid on a product within a certain time frame. Such a bidding system ensures that consumers experience a victory feeling when they get a deal. In its place this ensures that consumers want to ‘play’ more often and come back to the website. One of the best-known ecommerce companies that apply this form of gamification is Ebay.

3.            Loyalty points
A way to make existing customers come back is through a loyalty points system. Consumers can earn points when they revisit the website. This is often done through games such as slot machines and mystery wheels. The points earned by the consumer can be used to purchase products on the website.

[1] Hubspot (2017), Customer Loyalty: The Ultimate Guide.
[2] I95 DEV Team (2016), The Why and How of E-commerce Gamification with Examples.
[3] Ambition (2016), 5 Examples of eCommerce Gamification.
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