This is Part 2 in our series about virtual commerce. In the first article of the series, we looked at The Role of E-Commerce in MMOGs, how virtual currencies and virtual worlds develop and interact with e-commerce and how the gaming industry has used e-commerce in new and innovative ways. In today’s article, we are going to have a look at how the gaming industry’s approach to e-commerce has spread beyond that and into the retail industry and our day-to-day lives.
Shopping isn’t what it used to be. In today’s digital economy, commerce has become reliant on the internet even in the brick-and-mortar retail setting. And this phenomenon is not limited to commerce – it’s taking place in all industries, including video games. This is visible in the now-widespread popularity of Massively Multiplayer Online Games or “MMOGs”.
MMOGs are virtual environments (VEs) with their own communities and, in some cases, their own currencies, populated remotely by internet users anywhere in the world. The popularity of virtual environment across all demographics has allowed game developers and publishers to enjoy a very healthy marketplace.
Of course, marketers, retailers and developers have taken notice – the gaming industry is forecasted to surpass a value of 86 billion USD by the end of this year – and their scrutiny of this business model has resulting in a phenomenon called gamification.
The Gamification of E-Commerce
Gaming is no longer a niche activity and the influence of e-commerce on gaming is not a one-way street. As “gamer” habits spread among general consumers – now “everyone’s a gamer” – the same tools that the gaming industry use to attract and retain their customers are being put to use by businesses of all kinds.
Gamification is a term used to describe the application of game-like features or mechanics, such as points, levels and badges, in a non-game context. Businesses, just like developers, use these mechanics to encourage user engagement and repeat customers. In the US alone, businesses invested 100 million USD into gamification in 2014.
- Teleflora: US online florist Teleflora developed a social loyalty system that awards points for a variety of user actions such as customer reviews, posts to Facebook, comments and responses to queries. As users accumulate points, they are awards titles and badges, and top performers are listed on the Teleflora leaderboard. After launching this system, Teleflora’s Facebook referrals increased by 105% and their conversion rate by 92%!
- LinkedIn: LinkedIn rates your profile based on how complete the information is. In the competitive job-hunting environment in which LinkedIn operates, it’s only natural for their users to strive for 100%. By rewarding users for doing so, LinkedIn encourages more thorough profiles, which in turn improves the quality of the service it provides for businesses.
- Foursquare/American Express: Foursquare, the “check-in” app, partnered with American Express to provide redeemable credits as a reward for consumers checking in at participating locations such as H&M and Whole Foods. As a result of this rewards scheme, participating customers spent 20% more at these businesses.
- Perrier: In order to increase awareness and attract a younger audience to its brand, Perrier took gamification to another level by actually developing a game, Secret Place. The goal of the game was to locate a “secret” bottle of Perrier in a virtual environment, complete with live acting and over an hour’s worth of content. Finding the bottle gave players the opportunity to enter a sweepstakes for a free trip to any number of vacation destinations.
First and foremost, e-commerce gamification is designed to increase user engagement. The goal is to make the experience of interacting with your brand more entertaining for customers and to add hidden motivators for your customers to be exposed to your sales channels more frequently. In other words, gamification is the act of creating a virtual environment around your brand.
One of the reasons why this is such an effective marketing strategy is due to another contemporary phenomenon among consumers: FOMO, the Fear of Missing Out. One of the great drivers of customer loyalty is the public’s need to feel like they’re a part of something. Businesses can leverage this by creating a sense of community around their brand, a virtual world with real communication and interaction not just between the business and the consumer, but within the customer base as well.
- Reward your customers: Gamification is a logical successor to personalisation. Consumers now expect any business to know their name, so a personalised email isn’t going to cut it anymore. Offer your customer some kind of reward for interacting with your brand, such as achievements they can unlock or points they can use to level up. Prominently display their progress so they are encouraged to interact with you or make more purchases just to reach the next reward.
- Leverage social media: One type of interaction you can reward your customers for is sharing your brand content across social media channels, however we recommend going one step further and developing your own social media game, even if it’s something as simple as an image puzzle. People are naturally competitive and will want to share their high scores.
- Encourage visitors to explore your site: Bonobos was an early pioneer of gamification in e-commerce when in 2011 they launched a scavenger hunt encouraging people to find a man wearing their signature pants hidden somewhere on their website, rewarding the first 50 successful participants with a gift card. This and other techniques, such as rewarding visitors for “taking the tour”, allow you to share more of your content and features with consumers.
Using gamification to increase user engagement has a wide range of beneficial side-effects, such as growing your brand awareness, increasing your conversion rate, encouraging repeat customers, building loyalty and trust, and gathering invaluable user data. The gaming industry has honed these techniques for decades to keep their customers coming back for more, isn’t it about time you did the same?
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