The right application of gamification in retailers’ shopper engagement can drive substantial commercial benefits.
Most often if you do things right, it should have a positive outcome so the sentence above might not be truly controversial. You might actually say that the real controversy lies in what the right application means. What is the right way to apply gamification in a retail context?
This is what I will expand on further. I will examine the various components of a successful gamification solution and outline a framework for how to approach gamification from a retail point of view.
As a starting point, let’s make it clear that gamification is not games – it is advertising or shopper engagement driven by using methodologies and techniques similar to those used in games. In short, gamification is gamified engagement – and in the very commercial way that I approach it and that is the main focus of my ’expertise’, gamification is primarily gamified advertising.
Any gamification solution has elements from three different buckets:
Each of these buckets can be said to consist of a number of options or opportunities to include in a gamification solution. In return, choices made in one bucket influence available options in other buckets. This is regardless of which bucket you made your first choice.
An example: Many retailers that I talk to want to have (or are already heavily invested in) an app. They may have been through extensive analysis of their customer base needs and context, but I am going to risk it and claim that they haven’t. The number one reason that the majority of retailers choose to develop an app in today’s market is that it is the technology of convenience. It is the technology component that everybody talks about and that is embedded in our understanding of mobile culture. As such, it is also the obvious choice of technology. It might also be the best choice, but that will always depend – as I will outline below.
Regardless; an app is often the preferred and pre-determined choice in the technology bucket for a number of the retailers I talk to regularly. And that choice influences which gamification methodologies should be chosen, and which creative options are available.
It requires a different methodology to engage shoppers that are already deeply engaged with a retailer brand and using the app than it does if you want to engage shoppers that are less frequently engaged with the retailer brand. Similar to how you would choose different tactics to communicate to shoppers inside versus outside of the retail store. Typically, shoppers will need to download, register or sign in to the app to use it. This requires more effort and commitment and naturally, an app is more appealing to the core shoppers of a retailer than less frequent shoppers, that do not have the same level of trust and confidence in the retailer brand.
So, the gamification methodology applied within an app has completely different characteristics compared to using other technologies. And similarly, for creative content. Often an app comes with creative and contextual boundaries and constraints that influence which tools can be activated from the creative bucket.
To summarise, I am saying that whichever bucket you look at first, the choice you make in this bucket, will influence the opportunities available to you in the remaining two buckets. A choice of methodology influences options in technology and creative. A choice in creative influences methodology and technology – and as demonstrated, technology choices influence which methodology and creative choices you can make.
I am not saying that an app is always the wrong choice of technology, but instead, I claim that apps might not end up given a retailer the options they are looking for – and rather put limits on the opportunities available to retailers. So, apps should to a large extent be less of an obvious choice than they are today.
This leaves us with three buckets – and no clear starting point, nowhere to begin. But of course, there is the right place to begin. And it sits outside of the three buckets. Because you should always begin with what you want to achieve. Always begin with the objectives.
From a retail perspective, the objectives typically fall in 5 categories that can be summarised like this: Every retailer wants more shoppers, that are better connected, shop more, more often at a higher value. A simpler overview is this:
Let’s quickly introduce each of these overall objectives – I will dedicate more time to each of them at a later stage:
More shoppers is almost self-explanatory. More shoppers mean more individuals coming into the store. When more shoppers come into the store, retailers tend to make more money. In a competitive marketplace, attracting more shoppers is not always an easy task, therefore it continues to be of high importance to retailers to continuously attract more shoppers.
One opportunity is to get more shoppers – and a second one is to get more shopper trips from existing shoppers, to increase frequency. In today’s market, every shopper has more than one preferred retailer, typically 2-3 within grocery. In addition to this, a shopper typically has a set number of shopping trips per week. So, getting a shopper to increase the frequency with your retail brand at the expense of one of your competitors is an obvious route to shifting market share.
More shopper connectivity is a bit more difficult. We live in a connected world. New digital tools and media offer us the opportunity to connect with friends, family, brands, retailers, causes and much more. For retailers, this connected world offers an opportunity to communicate with shoppers – very often in a personalised way and without the mediated filter of traditional broadcast media. The connected shopper is easier to retain, easier to engage and has a higher lifetime value to retailers.
A shopper budget varies very little from week to week. So, the opportunity to drive overall shopper budget up is limited, but in a competitive market, the real competition is about unlocking a bigger share of the individual shopper’s budget. To get access to more shopper wallet and stretch spend.
The fifth and final big retailer objective is more shopper categories. Generally, shoppers tend to shop different stores for specific categories. That opens an opportunity for retailers to upsell new categories to shoppers – to get access to more shopper categories.
Each of these five big objectives is directly and indirectly connected to sales for retailers. There might not be a sale sitting directly at the end of deepening the connection to a shopper, but further, down the journey, there is a higher likelihood of selling more to the connected shopper. So, from a commercial point of view, each of the objectives is highly relevant to the retailer and should serve as the guideline for the three gamification solution buckets.
This leaves us with a framework for retailer gamification campaigns that looks like the model below. Where the objectives are our guideline and the three buckets are mutually connected and dependent on each other.
Moving forward, I will explore each of the objectives and each of the buckets in more detail.