Gamification Rewards – The 6 Types
November 10, 2022
The benefits of gamification are numerous, from improved motivation to better collaboration, instant feedback, performance boost, and more sales. Rewards play a significant role in the whole gamification process, which is exactly what we’ll discuss in this post. So, let’s go through the six types of rewards and the gamification loyalty program.
1. Fixed action rewards
Fixed action rewards are self-explanatory; the user knows precisely the requirements, i.e., what they need to do to get the reward. A great example of one such gamification reward is a loyalty program.
Loyalty programs act as a marketing strategy to motivate users or encourage customers to buy products or services by offering various perks, including discounts and rewards. The gamified loyalty program includes a tangible reward that loyal customers obtain after meeting all necessary requirements.
For example, a customer knows they will get something for free if they engage or make a specific number of purchases. Other examples of a gamified loyalty program are frequent flyer miles, collecting loyalty points, punches on the card, and so much more.
Gamification loyalty programs can increase customer engagement while building relationships and communities among all participants. People feel motivated to interact with your business or brand, which leads to repeat purchases.
A major obstacle here is that many brands or businesses aren’t sure how to apply gamification to loyalty programs. Doing so is quite simple when you have clear and precise goals. Set challenges, encourage sharing and interaction, make surveys and quizzes to spice things up, and create leaderboards.
Basically, you can introduce gamification to a loyalty program by making it more fun, challenging, and exciting. People need to feel like they’re having fun while also having the opportunity to win something or get some sort of value for customer loyalty.
Having fixed action rewards helps prevent a common mistake – too many rewards. In an attempt to increase engagement, loyalty, and motivation, some businesses arrange too many rewards. They do it too frequently or add too many rewards, points, or badges into the mix.
Doing so prevents the target audience from taking rewards seriously. Generally speaking, a gamification reward system should have a proper structure, and its main goal should be to motivate people to perform a specific action, not any action.
There are many ways to set up fixed action rewards in gamification. Time-dependent rewards can fall into this category as well.
These rewards are limited by time or triggered by a time-based event. For example, a company decides to reward users with a discount of 30% to 40% on someone’s birthday. Or a customer can get one free cup of coffee on their birthday.
Options are endless. It’s clear what the requirements are. Customers also know what the reward is. They know everything necessary for this reward. But, they can only get that reward at a specific point due to the time limit.
2. Sudden rewards
Sudden rewards are the types of rewards that users or customers don’t expect at all. There is no trigger or schedule behind them; they happen out of the blue. What makes these rewards so effective is that people love surprises.
Surprises are exciting and motivate people to make purchases and interact with the brand. They contribute to loyalty building. When a person wins a sudden reward, they feel happy and encouraged to return, hoping to win again. If you’re trying to build a community, sudden rewards can help boost engagement through gamification.
This type of gamification rewards works in two simple ways to engage customers. The first and most important mechanism of action is word-of-mouth, the most significant aspect of any marketing campaign.
Let’s say that person A wins a sudden reward. Are they going to keep it to themselves? Of course not! The reward is a great thing that makes them happy, and it’s perfectly natural that person A will want to share it with others.
What comes next is also perfectly normal – those people will want to engage with your business or brand, hoping to win something similar.
Another mechanism of action through which sudden gamification rewards function is speculation. Let’s go back to person A. They just won something out of the blue.
Participants or loyal customers will start speculating about the reward and wonder how they can do the same. Speculation leads to various theories about the sudden reward and how to win it. Theories revolve around how to earn rewards, resulting from reward-seeking behavior, a natural competitive spirit we all have.
Since people love good theories, their engagement increases, and they may start looking for Easter eggs or clues that would either support or debunk those theories. All this leads to better brand promotion, more sales, and increased loyalty.
3. Random rewards
Random gamification rewards are the rewards that follow completing a required action, but participants don’t know what they are.
First, it’s important to clarify that random and sudden rewards are two different things in gamification. Both types of rewards have an important similarity – they are unexpected. But the difference is in the definition of unexpected for each reward.
You see, random rewards are unexpected rewards following a specific or expected trigger. As mentioned above, a person doesn’t know what they’ll get.
On the flip side, a sudden award is a type of reward that follows an unexpected trigger and doesn’t have a specific schedule.
The main purpose of random gamification rewards is to spice things up. Increasing excitement and fun also boosts motivation and improve customer loyalty. A person gets their reward after completing a specific action.
Not knowing the reward when entering the contest or challenge isn’t an obstacle. Instead, it can encourage customers even more, to engage due to the element of surprise and excitement. Whatever the reward is, they’ll be happy to get it, which is why they keep competing. At the same time, they will keep making repeat purchases.
Everyone loves a little bit of mystery, and that’s precisely what random rewards provide.
4. Prize pacing for bigger rewards
Prize pacing is the gamification practice of creating a sense of scarcity while increasing the value of the reward.
The main goal is to distribute the prize regularly but in smaller doses. It usually involves collection sets. To win a reward, a person must collect all the times from the collection set.
With the prize pacing rewards program, participants engage more with the brand. Their purchases increase alongside excitement and fun. It’s about creating something of value that sparks interest or attention and may lead to winning amazing rewards.
This type of gamification reward system is useful because the brand or business doesn’t have to give rewards to everyone. Instead, it offers rewards only to people who collect the entire set and get all the album stickers or other pieces; options are numerous.
One needs to be highly successful to collect all the pieces, which is why that dedication should be rewarded.
The chase for parts of a collection set is exciting, and many people are just happy to be a part of it.
5. Rewards from friends
This type of gamification reward refers to cases when it’s given to someone by their friends or family members. People can’t earn it. They can’t buy or collect it either. The only way to get the gamification reward is when a friend gives it.
The most important aspect of this gamification reward is word-of-mouth promotion. As mentioned above, word-of-mouth leads to better engagement and more sales. This market strategy also increases brand recognition and builds customer loyalty.
While word-of-mouth costs less than other marketing strategies, it’s a great way to promote your products or services. It stimulates conversation about the brand or business.
So, you decide to give this gamification reward style a chance, and what next? Businesses or brands that opt for this type of reward often do it through friend discounts or referral fees. The latter may seem familiar.
A good example is signing up for some service online where you can get $20 or $25 (or more than that) just by referring a friend.
Most people have come across these types of rewards. You just haven’t thought about them this way. The claim you’re going to get a specific amount of money if you bring someone else is an attempt to promote business through the power of recommendation.
To get a discount or something else, you will bring someone along, and they will do the same. This means customer engagement increases with this type of reward, mainly due to the “friend” component.
6. Rolling rewards
Rolling gamification rewards are rewards given to customers or users by chance following the completion of a specific action. An excellent example of one such reward system is any contest or purchasing lottery tickets.
In a nutshell, rolling rewards are based on the notion that someone has to win every time. The longer you stay in the game as a participant, the more confident you feel about the potential win. The likelihood of winning the reward, e.g., lottery, increases when you participate every week or with more ticket purchases.
Even when people know the chances of winning the reward are close to none, they still participate. The lottery is a great example again. Why? Gamification encourages customers to keep participating because the requirements aren’t strict, tickets aren’t expensive, but the reward involves a significant amount of money. This type of reward is all about creating interest.
For that reason, rolling rewards attract a lot of people; despite slim chances, those who do win become the best fans or advocates of your business or brand. They talk about their reward and thereby promote (and recommend) your brand or company to other customers.
The Bottom Line
Gamified rewards are a simple and straightforward approach to increase loyalty and engagement while promoting the brand or business. As the #1 sales gamification company, Spinify makes it easy to implement your gamification efforts, helping you take the whole process to the next level. Book a demo today and see how Spinify’s gamification tools can help you deliver an exciting, gamified reward program.
Put those insights into practice.
Set your team up for success by improving their performance through gamification.
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