How gamification can boost eCommerce sales

Time to define

Before we advance to the next level of gamification (see what I did there?) it’s helpful to nail down a definition. Luckily, the boffins over at Forrester Research have a short and sweet definition of the term:

“The insertion of game dynamics and mechanics into non-game activities to drive a desired behavior.”

While handy, that definition certainly makes gamification sound a whole lot simpler than it is. After all, making games that people want to play is difficult. The worldwide video game industry is worth almost US$200 billion and even the experts over at Nintendo and EA come out with duds from time to time. Of course, the pros are creating games that aren’t designed to encourage any behavior other than more gaming (or sometimes purchasing loot boxes).

So how what chance do the rest of us stand when we’re trying to use gamification to incentivize people to do things they’re not always keen on, like reach into their wallets? You might be surprised to learn there are plenty of examples of the power of gamification working to full effect in less than exciting scenarios. For example, Luis von Ahn, the inventor of the CAPTCHA (which has also been gamified) used gamification to get people to help him teach computers how to label some of the huge numbers of images on the internet. He was able to incentivize people to carry out the tedious task of labeling pictures by turning it into a competitive game.

Canadian-American author, public speaker, and businessman Gabe Zichermann probably summed up the power of gamification best:

“Games are the only force in the known universe that can get people to take actions which are against their self-interest, in a predictable way, without the use of force,” he said.

4 ways gamification can help your business

Let’s dive into four ways gamification can help your eCommerce business and as you’ll see, they’re all in areas that are pretty fundamental to success.

Engagement

This benefit is pretty self-evident but it’s still worth exploring in a bit of detail. Why does gamification help with engagement? Because good games are engaging! Remember though, increasing engagement with your site or products via gamification doesn’t mean just building a simple flash game and throwing it on your site, it means using game-like mechanisms or elements to encourage certain behaviours.

The proof is in the gamified pudding (which doesn’t sound particularly appetizing), as American telecoms giant Verizon found using gamification its website by rewarding users with badges for engaging with the site made users spend 30% more time on the website. Why does engagement matter? Because engaged customers spend more money. Research from Gallup found that a fully engaged customer “represents an average 23% premium in terms of share of wallet, profitability, revenue, and relationship growth compared with the average customer.”

The “badge for engaging” is a pretty common and effective gamification tool. It’s so common, in fact, we’ve all probably come across one at one point or another. In late 2019, Facebook rolled out ‘top fan’ badges on the social media platform. The gamification feature encourages engagement by rewarding those fans of a page who interacted with it the most, thereby encouraging them to engage even more. It also encourages some of those without top fan badges to engage more, motivated by a desire to win the top fan ‘game’ themselves.

Cart abandonment

There are few phrases more dreaded in eCommerce than ‘cart abandoned’. It spells the ruination of all your hard work of actually getting a prospective customer to browse your store, find what they want to buy, and click to put it in their cart, only to have the sale scuppered in an instant. Did their internet cut out? Did they baulk at the final price? Did they decide to delay their purchase? Whatever the reason, keeping cart abandonment low is key to success, as evidenced by some research suggesting cart abandonment costs eCommerce businesses US$18 billion per year in lost revenue.

The reason gamification can be of benefit here is that parting with cash can be a painful process for a lot of us and if it can be made just a little bit more fun, that can go a long way. One method lots of websites employ is a progress bar, showing how many more steps a customer will have to make to complete their purchase. If you’ve ever used a Kindle, you’re probably aware of how satisfying it can be to see just how much of a book you’ve completed, and how being able to track your progress encourages you to keep reading. The effect is similar when it comes to shopping online, and a bonus effect is it makes shopping more transparent for your customers.

Loyalty programs

If you’re a regular reader of our blog (and let’s face it, you should be) you’ll know how valuable a good loyalty program can be for your business, and this is another arena gamification shines in. When you consider research that indicates that acquiring a new customer can cost five times more than retaining one, employing the benefits of gamification to your loyalty program is a no-brainer.

You just have to look at one company to see how effective gamification can be for customer loyalty: Shein. The controversial fast fashion brand is now worth more than US$100 billion and is the world’s biggest online-only fashion retailer. Shein’s rise has been meteoric and not without controversy around environmental issues and alleged intellectual property theft, but one area plenty of other brands could learn from them is gamification and customer loyalty.

Shein uses a simple points program where every 100 points a customer earns can get them a dollar discount. What’s innovative is how customers earn the points, with things like points for frequent logins (a surefire way to connect with the smartphone fiends that make up Gen Z), playing in-app minigames (which also boosts engagement) and writing reviews also up for grabs. Customers can also earn points for following brands that sell via the Shein platform on social media, and even win points for participating in ‘outfit contests’ by posting a photo of themselves on social media wearing clothes bought on Shein.

Cross-selling and up-selling

Gamification as a whole rests upon the concept of operant conditioning, which to laymen like you and me means people are more likely to repeat actions that result in positive reinforcement. So if your checkout process is gamified and gives customers the satisfaction that gaming should, won’t it be easier to get them to buy more from you?

This is how gamification aids when it comes to cross-selling and up-selling. While you probably don’t need a reminder of how valuable good cross-selling and upselling can be, it’s still worth pointing out that McKinsey research found cross-selling can boost profits by 30%.

Gamification can be as simple as rewarding a customer with an engagement badge or even a notification on your website when after you upsell or cross-sell to them can be a big help. Or you could put a slider on a product page to show the delivery cost savings if a customer buys two products from you at once, instead of over two separate purchases.

Game on

Ready to learn more about how we can help your eCommerce business here at SmartOSC? Contact one of our experts directly today.