Over the long term, the return on investment (ROI) in customer loyalty pays off better than any discounts and coupons. Keeping an existing customer costs 5x less than acquiring a new one. Loyal customers also deliver a greater lifetime value (LTV), of as much as 10x their first purchase. And they drive revenue; nearly half of an eCommerce store’s revenue is created by only 8% of their most loyal customers.
With transactional deals increasingly less effective, brands are relying on gamification to better engage customers and build loyalty. Gamification is not new. Marketers have been using people’s competitive nature to get them into stores or to visit websites, then make purchases they may not have considered otherwise.
But today, gamification is being applied in much different, and more subtle ways, as a key component in the personalized, customer loyalty loop. Progress markers, tiered statuses, the ability to level up or unlock rewards, and goal setting enable brands to better understand and acknowledge consumers’ individual journeys in ways that inspire loyalty, while working toward key business objectives, such as increased sales and revenue growth, that are also aligned to making the lives of customers better and easier.
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