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Driving loyalty through Gamification: How to incentivise cardholder spend

Boosting cardholder spend is at the core of every card issuer's strategy. It's simple – the more a cardholder uses their card with healthy spending habits, the better it is for the issuer.

However,traditional methods of are becoming less effective. Leaving card issuers feeling the heat to find better ways to encourage cardholders to use their cards more frequently and for higher spend purchases.

So how do card issuers make their card the top-of-wallet choice for cardholders amid a sea of competitors vying for the same spot? The answer lies in creating an engaging experience that goes beyond transactions.

Let’s get into it. 👇

Facing card issuer challenges head-on

Encouraging cardholders to choose your card for their transactions (especially when it's a travel-specific card) can be challenging. In a world of information overload, catching and keeping the attention of cardholders is no small feat.

The challenge is that encouraging card spend often relies on running high-volume campaigns with low conversion rates. 

But traditional reward programmes are becoming stagnant. Methods like emails and newsletters often get lost in the noise. And then there's the challenge of personalisation. Simply having a rewards program is not enough.

That’s why card issuers are looking for something that makes them stand out from the crowd.

The bottom line is: A cardholder who feels engaged is more likely to prefer your card over others, ultimately leading to an increase in card spend. Enter gamification. A proven and exciting strategy with vast potential for financial services.

Increase card spend with the gamification advantage 

The financial services sector is no stranger to gamification. Many institutions are already using it to engage their customers in innovative ways. From boosting customer engagement and loyalty to enhancing product knowledge and driving specific customer behaviours, gamification has proven to be a powerful tool in the financial services toolbox. 

For card issuers, it holds immense potential to transform the way cardholders interact with their cards, driving not just spend, but also loyalty and satisfaction.

For example, gamification can creatively engage cardholders by gamifying the domestic spending experience. For example, you could introduce a special 'Home Adventure' game where cardholders earn extra points for domestic transactions. 

Card issuers can also make use of seasonal themes. During peak travel times, encourage domestic tourism by rewarding cardholders for spending on local attractions, dining, and staycations. And during off-peak times, offer bonus points for everyday domestic purchases, like groceries or gas, emphasising that their travel card is not just for travel, but a companion for everyday life.

Through gamification, you not only drive domestic spending but also increase engagement and loyalty, transforming your travel-specific card from a 'sometimes' choice to a top-of-wallet option, both at home and abroad.

In essence, gamification is not just about making things fun; it's about creating meaningful engagements, fostering loyalty, and ultimately, driving business results. And in the world of card issuers, that translates to increased cardholder spend. 

Leveraging gamification to increase card spend

In essence, gamification takes the elements that make games engaging – like competition, rewards, and achievement – and applies them to non-game contexts, like credit card usage. By gamifying cardholder engagement, you can create a more interactive and personalised experience. 

Imagine a rewards program where cardholders earn points for using their card, which they can then use to "level up" and unlock new benefits. Or a challenge where cardholders compete to reach spending targets and earn exclusive rewards. Not only does this make the card usage experience more engaging, but it also encourages cardholders to spend more. 

In this way, gamification can turn the challenge of cardholder engagement into an opportunity for increased card spend. And when credit card usage is happening on a regular basis, issuers enjoy steady revenue, especially if the customer has set profitable card habits.

In fact, card issuers that leverage gamification to engage customers regularly at this stage can see a significant impact on CLV. And the beauty of gamification is in its versatility. You can tailor it to match cardholder preferences, driving engagement, loyalty, and cardholder spend. In fact, drawing on gamification can significantly boost card spending habits. 

Gamifying the cardholder experience

Gamification can help card issuers increase credit card spend in several ways:

1. Creating engaging experiences: One of the main benefits of gamification is that it turns routine tasks into fun and engaging activities. We can help design a gamified experience for card users where each transaction or spending tier can trigger a game where customers can win prizes or cash back. This can motivate card users to spend more to increase their chances of winning.

2. Customer loyalty: Gamification can also increase customer loyalty by making interactions with the card issuer more enjoyable. This, in turn, can lead to increased card usage and spending. For instance, we can design custom loyalty programs that reward customers with points or rewards for using their credit cards, creating a positive reinforcement cycle.

3. Tailored campaigns: Some platforms enable the creation of personalised and targeted campaigns. For instance, if a card issuer wants to promote spending in a specific category (like dining or travel), they can create a campaign where card users earn extra points or rewards for spending in that category. This kind of targeted promotion can encourage card users to increase their spending.

4. Data-driven insights: You can also gain a deeper understanding of customers' spending behaviours and preferences through data gathered from the gamified experiences. This data can then be used to tailor further campaigns or offers, optimising engagement and promoting further spending.

5. Increased engagement: Finally, by creating an interactive and engaging experience, gamification can help increase the interaction between the card issuers and the cardholders. This increased engagement can help build a stronger relationship with the customer, promoting trust, and potentially leading to increased credit card spending.

By integrating these strategies, card issuers can create a more engaging, rewarding, and personalised experience for their cardholders, driving increased usage and spend on their credit cards.In conclusion, gamification holds immense potential for increasing cardholder spend. It's about making the cardholder experience more engaging, more personalised, and yes, more fun. 

Through features like competitions, points for purchases, and an engaging educational experience, cardholders are motivated to use their cards more frequently. And points earned can be redeemed for a wide range of rewards, such as cashback or gift cards. However, our goal is not just increased card usage, but promoting healthy financial behaviour through an engaging, rewarding experience.

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Rebecca Trivella

Rebecca Trivella

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3radical

Member since

22 May 2023

Location

Bristol

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5

This post is from a series of posts in the group:

Innovation in Financial Services

A discussion of trends in innovation management within financial institutions, and the key processes, technology and cultural shifts driving innovation.


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