How challenges and games drive consumers to purchase more from brands

by | May 2, 2022 | Marketing, Public Relations

Recently released research from dynamic offer platform Formation offers insights for brands to transform their loyalty programs from a mass, earn-and-burn model to a gamified, personalized experience that creates stickiness and drives revenue from loyal customers.

Loyalty programs should incentivize customers to more deeply engage with a brand by making purchases or taking specific actions, but, according to the firm’s recent survey of 500+ US adults, current loyalty programs are falling short. Almost half of consumers (45.3 percent) would rather enroll in a loyalty game to win a prize, rather than continue on a regular program with simple points earnings, and 49.2 percent said the games and sweepstakes are more fun than consistently accumulating the same rewards or points for purchases.

Games and fun also drive loyalty with modern buyers—three-quarters of consumers (72.5 percent) said they feel more inclined to shop at brands that make their loyalty experience fun and rewarding.

In addition to being less fun than personalized games or challenges, existing loyalty programs are at risk of decreasing overall revenue because they are confusing for consumers. According to research, 80 percent of consumers are sometimes or often confused about what their loyalty program benefits and rewards actually are. Making loyalty program progress less confusing has massive revenue benefits, because when brands create engaging, clearly-understood loyalty programs, consumers are more likely to purchase:

  • 65 percent are more likely to engage with a loyalty offer when they see the path to getting a reward laid out clearly
  • 62 percent frequently make purchases in order to advance their status in loyalty programs

As brands look to gain share of wallet in an increasingly competitive marketplace, loyalty programs can be a key driver for long-term customer retention and revenue. However, it is clear that earn-and-burn programs, with complex rules, are not deepening the relationship between brands and customers. A new style of loyalty program, with personalized games and challenges, alongside a clear understanding of what to do next for a reward, is needed for brands to drive revenue from their customer base.

Loyalty status in real time

Expanding on its recent launch of hosted offers that simplified the creation of gamified loyalty experiences, Formation is delivering clarity, efficiency and fun for brands and their customers through Real-Time Offer Status, which enables the creation of personalized loyalty challenges.

Many brands today are in the process of their own digital transformations as they move to answer the demands of a customer base that is increasingly digital and looking for a deeper and more meaningful relationship when it comes to loyalty.

With 49 percent of loyalty program members checking their loyalty program status multiple times per week, brands need an easy way to provide real-time offer and achievement status without complex MarTech stack integrations, net new development, or competing for already scarce technical resources.

Real-Time Offer Status further extends the Formation Platform’s unique and patented solution. “Now product teams can implement highly engaging gamified loyalty experiences that drive consumers to take action and make purchases, with an easy-to-use API,” said Christian Selchau-Hansen, CEO at Formation, in a news release. “Consumers are demanding fun, personalized experiences, and this new capability from Formation enables these experiences to be easily implemented across multiple touchpoints so consumers can see their progress and engage more deeply.”

How challenges and games drive consumers to purchase more from brands

Richard Carufel
Richard Carufel is editor of Bulldog Reporter and the Daily ’Dog, one of the web’s leading sources of PR and marketing communications news and opinions. He has been reporting on the PR and communications industry for over 17 years, and has interviewed hundreds of journalists and PR industry leaders. Reach him at richard.carufel@bulldogreporter.com; @BulldogReporter