Gamification of cardholder engagement

We all know someone who is constantly checking their phone, and it’s now commonplace to see some sort of technology worn as a daily accessory and regularly monitored. You might know this person, or maybe this person is you. One word comes to mind: Fitbit. What is it that makes this fitness app so addicting? Simple: Gamification.

For those unfamiliar with the term, gamification is the application of typical gaming devices (scoring, rules, competition, etc.) to nongame activities in order to spur engagement of users. By adding these features to products, Gamification provides a “carrot on a stick” for people to achieve. Fitbit is particularly good at this by creating competition with friends, challenges to conquer, and medals for achievement. These Gamification concepts and goals are easily transferable to banking rewards programs.

Gamifying Rewards

So how can a banking rewards program add gamification features to enhance user engagement? Well it can be done in a multitude of ways:

1. Point Earning Opportunities 

Gamification for the consumer is built on the concept of their actions earning them something. These can be bragging rights or medals, but most often it is something monetary like rewards points. While it’s likely enrolled cardholders already earn points from regular transactions, gamification lets you create new driving opportunities to push usage and engagement further.

For instance, a credit union could partner with a local business to award cardholders double the regular points for shopping with their debit card at that business. This action would drives revenue back to the local business, while also increasing interchange revenue for the credit union. Creating goals and incentives to earn more points in a key tenant of good gamification, which leads us to… 

2. Challenges

Challenges are a standard gaming technique. For cardholders of a banking rewards program, a challenge could be something like “make seven more purchases in March with your debit card than your usual monthly average.” Completing the challenge would provide a large boost in points for the user, on top of the regular points that would be earned. These challenges are a great way to boost cardholder engagement and usage during the period they’re running. Take the Buzz Points Pot O’ Points challenge, for example. During this campaign, cardholders who managed to beat their goals averaged 53.7 transactions during the campaign—a lift of 19.9 transactions.¹

This challenge wasn’t limited to cardholders enrolled in the rewards program. On top of the enrolled group, non-enrollees who met the specifications for the challenge were then contacted and prompted to enroll in the program to earn the points and rewards they unknowingly earned. The Gamification element can be used to incentivize participating rewards users, but is also a tool for growing the user base of your program. During that same Buzz Points Pot O’ Points challenge campaign, new enrollment during the campaigns was 2x the typical monthly average¹.

3. Competition

People love competition and people love winning. It’s the guiding idea behind the above-mentioned Fitbit program where users compete against friends to see who has the most steps. Competition, especially amongst friends, is a powerful driving force for action. This force can also be applied to cardholder behavior.

Buzz Points, for instance, has run campaigns where cardholders of financial institutions were incentivized to use their cards and redeem their rewards for charities. This competition ran among several institutions across the country and the institution that had the most charitable donations was given a bonus prize for a charity. This competition lead to an increase in charitable redemptions by over 200%, when compared to the average rate.

Competition could also directly tie into showing users the top transaction numbers or highest percentage of local spend, giving them a goal to beat. Challenges and competition go hand-in-hand.

Gamification opens up many new opportunities and avenues for member engagement with a rewards program. By dangling that carrot on a stick, you entice cardholders into action, in this case, earning more rewards. At the end of the day, it’s an excellent way for financial institutions to improve cardholder engagement, see higher enrollment rates and increase interchange revenue.