The value of the global gamification market reached $11.94 billion in 2021, hinting at the increased adoption of the concept by businesses. Companies are using gamification for everything from employee onboarding and training to improving customer engagement.
The versatile nature of gamification allows for its successful implementation in various business contexts, but it’s particularly impactful for SaaS businesses. That’s because subscription-based models are often reliant on long-term customer relationships through subscription renewals.
SaaS businesses need to find ways to reduce customer churn and ensure long-term relationships. SaaS gamification strategies can be just the way to accomplish this. Let’s look at how.
What is gamification?
Gamification uses game-like mechanics and elements in non-game contexts to boost engagement and motivation. The goal is to tap into our natural desire for competition, social interaction, and rewards to achieve desired outcomes.
It’s a relatively new concept that has only recently gained popularity in the business world. But businesses are catching on fast because gamification can achieve various objectives. These include:
- Increasing employee productivity
- Enhancing customer engagement
- Improving brand awareness and marketing ROI
- Reducing customer churn
How does gamification work?
The principle behind gamification is simple: People are more likely to perform an action if they’re rewarded for it. It could be in the form of badges, points, leaderboard rankings, or even real-world prizes.
The key is to make the rewards meaningful and relevant to the user. They should also be timely so that people are motivated to act now rather than later.
For instance, a SaaS company can gamify the onboarding process by awarding points to new users for completing specific actions. These could be something as simple as setting up their profile or taking a tour of the product.
As users accumulate more points, they can move up the leaderboard and unlock new badges. The goal is to make the process fun and engaging so that users stick around long enough to become paying customers.
What are the benefits of gamification?
Gamification has many benefits for SaaS and other businesses. Here are some of them.
Induces operant conditioning
Operant conditioning is the underlying principle of gamification. The concept states that people are more likely to repeat a behavior if it’s followed by positive reinforcement.
In other words, we’re more likely to do something if we’re rewarded for it. Gamification takes advantage of this by using rewards to motivate people to take specific actions.
Improves customer retention
Acquiring a new customer is six to seven times more costly than retaining an existing customer. Therefore, SaaS businesses must focus on customer retention to be successful.
Gamification can help with this by encouraging customers to keep using your product. For example, you could give customers points every time they use your product. These points could then be redeemed for discounts or other benefits.
Increases engagement
Gamification can also increase engagement by making your product more exciting to use. Consider two scenarios. First, imagine using a boring product with no incentive to keep using it. Second, imagine using a product that rewards you for taking certain actions.
Which scenario would you be more likely to stick with? Most people would choose the second option. Gamification makes products more engaging by adding an element of fun and positive reinforcement.
What are the 3 elements of gamification?
When adopting SaaS gamification strategies, it’s imperative to ensure they have these three indispensable gamification elements:
- Meaningfulness: First and foremost, users must see the purpose behind the game. The gameplay should also be a logical extension of the user journey within the given application.
- Conditioning: The game should be designed so that users repeatedly experience positive reinforcement (instant rewards, feedback, etc.) for completing specific tasks.
- Communication: Finally, the game should be transparent in communicating progress, goals, and objectives to users. Ideally, it should also provide users with a sense of social engagement by involving friends and colleagues.
When these three elements are combined, the result is an addictive game that encourages users to return for more.
5 SaaS gamification strategies to retain customers
It’s no secret that gamification is set to take center stage, with its sales revenues expected to reach $32 billion by 2025. But which SaaS gamification approaches work well? Here are some options.
1. Point systems for onboarding
In a Wyzowl survey, 90% of the customers said companies could improve their onboarding of new customers/users. With gamification, it’s possible to make the onboarding process more interactive and engaging for customers. One way to achieve this is by using a points system where customers are awarded points for completing tasks during signup or their first login. For instance, they could receive points for answering a series of questions about themselves. Then, you can reward them with points for putting up a profile picture. Likewise, you could give them additional points for watching a video, filling out a profile, or taking a product tour. You can even go further by allowing customers to redeem their points for prizes, discounts, or early access to new features.
2. Achievement badges
A sense of accomplishment is one of the main reasons people play video games. You can use this to your advantage by giving customers badges for completing tasks or reaching milestones.
Suppose you’re a SaaS company that sells project management software. In that case, you can give customers badges for:
- Creating their first project
- Inviting their first team member
- Adding their first task
- Reaching 100 tasks in a project
- Completing all tasks in a project
Customers are more likely to stay engaged with your product when they see their progress is tracked and rewarded. Treehouse is a good example of this. The virtual academy teaches app development and coding to beginners. Users earn badges and points for completing course material.
3. Leaderboards
People are naturally competitive, and a leaderboard is an excellent way to tap into that natural tendency. By ranking customers based on their performance, you can encourage them to keep using your product to improve their position on the leaderboard.
Let’s say you run a SaaS company that sells CRM software. You can create a leaderboard of the top salespeople per the number of deals closed or the value of the deals closed.
Autodesk tapped into this by creating a gamified tutorial for its trial period. Users do virtual missions to make a place for themselves on the leaderboards. Users with high scores are featured on Autodesk’s homepage.
4. Theme-based gamification
SaaS companies can take gamification to the next level by basing it around a theme or story. It’s an excellent way to make your brand more relatable and engaging.
Salesforce Trailhead is a good example here. It’s a gamified learning platform that uses the metaphor of hiking trails to teach users about Salesforce products.
As users complete tasks, they unlock new trails and eventually become “Rangers.” The copy also follows the theme, encouraging users to “Choose Your Adventure” and “Blaze Your Trail.”
5. Feature unlocking
One of the main attractions of video games is that users can unlock new features, avatars, and venues. SaaS companies can do the same.
Habitica, a habit-development app, does this perfectly. Besides simple to-do lists and goal tracking, the software lets users do the following:
- Complete tasks to level up avatars
- Unlock new magical pets, quests, and armor
- Earn rewards and gold upon task completion
- Battle monsters with other app users or friends
Since the app is heavily gamified, it’s engaging and fun to use, encouraging users to develop healthy habits.
What is software gamification and how can SaaS Companies implement it?
Software gamification is the process of adding game-like elements to software to increase engagement and encourage users to keep using the product. SaaS companies can use it to improve customer retention and loyalty. Here are some tips to get the implementation right:
Keep it simple
Don’t try to do too much at once. Implement one gamified element at a time and see how users react to it. You can always add more later.
Make it relevant
Your gamification should be relevant to your product and target audience. It should also align with your company’s values and mission.
For example, a budgeting app should not have users earning points for spending money. That would go against the app’s purpose.
Include positive reinforcement
Make sure your elements include some form of positive reinforcement. A budgeting app can give users points for completing their monthly savings goals. Or, a task-management app can award users with a badge for completing all tasks in a project.
3 real-life SaaS gamification examples
Here are some real-life examples of SaaS gamification to inspire you.
Nike Run Club
Nike, known for its innovative marketing campaigns, was one of the first companies to gamify physical activity. The Nike Run Club app turns running into a game by tracking users’ progress and awarding them points for completing milestones. Users can also go on virtual treasure hunts to find the latest sneakers.
ProdPad
ProdPad is a product management tool that helps users develop and track product ideas. The company uses gamification in its free trial to retain customers.
For instance, users can do specific tasks, such as adding a user persona or inviting friends to extend their free trial.
Freshdesk
Freshdesk is a customer support software that uses “quests” to gamify the user experience. The quests are designed to help users learn about the product’s features.
These pop-up missions allow users to complete tasks to earn points and unlock badges. The platform also has leaderboards to show top scorers.
Work with a reliable partner for SaaS gamification
SaaS gamification strategies can be the key to success for your company. Adding game-like elements can increase engagement, loyalty, and customer retention.
Once you find inspiration from a gamification strategy example, you can turn to VeryCreatives for our expertise and skill in designing SaaS products. We assist you at every step, from ideating to development. Book a call with us today to learn more.
