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Gamification: Another word for engagement

MasterCard works on evolving means to keep cardholders tied in

Gamification: Another word for engagement

A key element of any kind of card gamification is building in some fun, according to MasterCard's game experts.

American consumers play games even when they don't realize it.

If you don't believe that, consider the classic retail "buy one, get one free" offer, says Chris Guiney, vice-president, product development, in MasterCard's Global Cardholder Solutions.

We've all taken part in such offers in some retail channel grocery store, electronics store, what have you and we all want to "win" the game. Guiney says people typically try to find the best combination of goods, to get the most for their money.

While the current phrase "gamification" makes this kind of marketing sound brand new, he and his boss, Chris Bond, group head/global lead, Global Cardholder Solutions, say the goal, ultimately, is consumer loyalty to a brand.

The basic games that people play with retail providers share many of the same essentials that they have for years, the pair point out. The roots of some games go back to old formats like filling paper books with trading stamps of one color or another or punch cards, but they are about the same things to consumer and to retail provider. The availability of advanced communications, data gathering, and, above all, speed, have taken the concepts light years beyond licking stamps for months and taking them to a redemption center to redeem out of a catalog, however.

Bond's group works with issuers on a number of different kinds of programs. These include rewards programs, where gamification efforts chiefly come in; benefits, such a concierge service and airport lounge access, that come with certain kinds of cards; insurance and extended purchase warranty packages; and the consumer contact centers that support these businesses.

Games can get serious

Remember the "Seinfeld" episode where Elaine accidentally gives her phone number--really, a fake number--to a guy on the back of a submarine sandwich shop's punch card? She arranges to meet him in a bagel shop to get her precious card back. Even when she's offered a bagel sandwich by the boss at H & H Bagels, to get her to eat and leave, she holds out. She wants the free sub that she earned, she explains.

We take our games seriously. And so do card issuers and the merchants they work with to stimulate purchases, repeat buys, and other desired behaviors.

"There are so many kinds of games," says Bond. They are tailored for various purposes. Always looming is the cost of fulfillment. One variation is where a company offering a game provides a grand prize such as a wonderful trip. Each entry costs the players a slug of points they've accumulated in the provider's loyalty program. These contests help providers "burn off" large amounts of points that have built up, in order to keep the costs of gamification down.

The games efforts that the executives' operation devise, mostly on a white-label basis for MasterCard issuers, run the gamut of types. Some that are run in cooperation with merchants, such as coffee shop chains, tap into people's competitive spirit. Players compete to reach levels of achievement with friends, for instance, earning status or even badges in reward for reaching levels of consumption.

Remember grade school programs where kids were incented to read more, by advancing into higher and higher color categories, for status? Modern programs rely on the same urge to pull out in front, even if there isn't an actual, tangible reward to be won immediately.

"One of the big values of the promotions we run is that the nature of loyalty is that you are doing a reward experience model," explains Guiney. "We try to make it as seamless as possible. A lot of the work that we do is to get the cardholder to interact the way the cardholder and the bank feel is good for both of them, without it feeling forced."

"That's really the benefit of a good game," Guiney continues. In a good game, the player wants to go back and do it again. He points out that the range of "ville" games people play individually or in teams or communities on electronic devices are an example of how people enjoy participating towards some goal, such as building up their holdings of "land."

Bragging rights and tangible rewards

"It may sound weird, when you are talking about making a payment with a credit card," says Guiney. But the idea is to make using a card an event, not just a transaction.

"If a program can get you to take out your card more, research shows that you will use that card more, rather than cash," says Guiney.

Some games, the pair points out, bring tangible rewards along with status. A player may earn the ability to obtain discounts on goods, such as a round of beverages. When they treat their friends using such a discount, they usually talk about it, and that encourages the guests to want to try the game too.

Part of the appeal may simply be "bragging rights."

Gamification appeals to multiple demographic groups within the cardholder audience. Often, the underlying game program may be the same, but the means of accessing the program is tailored to the demographic group's preferences. Older consumers, for example, may go for phone-based programs--a number is posted and callers hope to be a winner by being, say, one who is the third caller to make contact.

Millenials, on the other hand, like to make contact through Facebook.

Programs are designed based on the type of behavior that sponsors desire. A program may, for instance, be intended to encourage large ticket purchases with a card. Or they may be designed to encourage many small purchases. Or they may be designed to incent purchases of a particular type of good, by granting points multipliers for buying gasoline or another item.

The goal is set by the issuer, and "we wire it up," explains Guiney.

"Loyalty has always been a game," says Guiney, "the end result being higher returns and more rewards for loyalty." Bond points out that our increasingly plugged-in society likes immediacy, and programs frequently give updates to players so they understand how they are doing.

Merchant offers have increased their role in gamification and engaging simultaneously with a particular brand and a particular card has become a popular combination.

"The card-linked offer space is merging with the issuer-rewards space," says Bond.

Social media exerts an influence

As programs tap into competitive spirit and immediacy, they play into the ubiquitous nature of social media, says Bond. When people get rewarded for a particular behavior, these days they put it out to their social media network, and their followers pick up the news and then want to get aboard, too.

"Buzz leads to more business volume," says Bond.

The ability to run programs off electronic platforms has changed the nature, and the costs, of gamification. Back when everything relied on printed materials that required physical distribution, the cost of a flop hurt. Now, if an effort doesn't generate significant results, it can be changed or rethought or withdrawn for the time being. Sometimes a seasonal offer doesn't work at a particular time, but it may take off at a future occasion.

Bond and Guiney explain that an important element of MasterCard's effort is knowing the organization's strengths, and not building out internal abilities to be competitive, but instead seeking partnerships with others who are "best in class."

"Is MasterCard going to be the greatest at launching a rocket to the moon?" says Guiney rhetorically. "Probably not. But would we have something that would power a group of people who are trying to make that happen? Possibly so."

"So," he continues, "if the game's object is to spend certain amount to get on a flight to the moon, that's something we are good at. But if you said I was going to be responsible for someone staying alive who went on a rocket, that would not go well."

If it sounds like this is a fun business to be in, maybe so. Bond admits that there is an element of that for games makers.

Steve Cocheo

Steve Cocheo’s career in business journalism has taken him to all 50 states and nearly every corner of banking in institutions of all sizes. He is executive editor of Bankers Exchange and digital content manager of www.bankingexchange.com. Previously he spent 36 years on the staff of ABA Banking Journal and 22 years concurrently as editor of ABA Bank Directors Briefing. He is the only journalist to have sat in on three federal banking exams, was a finalist for the Jesse H. Neal national business journalism awards, and a winner of multiple awards from the American Society of Business Publication Editors.

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