3 May 2023
Gamification of financial services: current trends and future possibilities
A game-changing approach to Financial Services
Gamification is about customer-centricity: it helps customers achieve their goals in a way that emotionally engages them. Regulatory hurdles, high switching costs and customer inertia always guaranteed Financial Services firms’ structural customer captivity, but the reality is changing fast. Demanding customers and enabling technology are encouraging disruptive models whilst regulators are supporting increased competition. The opportunity for customer-centric alternative financial firms is thus created.
Amongst the global population of over 7 billion, 95% of the people in the world today are connected to the Internet. There are currently over 1.5 billion smartphones and their penetration is growing at over 30% year on year. This opens up possibilities to engage with consumers that were unthinkable only a decade ago.
The rise of Millennials
Millennials, the first generation to grow up surrounded by the modern “instant gratification” technology of digital media. They are the new consumers and they demand highly engaging solutions.
Mass popularity of gaming
The online gamer community counts over 800 million people around the world, with the average gamer playing 13 hours a week. Worldwide, this is a $37 billion industry. What can businesses learn from this trend to provide immersive engagement to their consumers?
Gamification can be used extensively to educate consumers, to market their services, to make mundane tasks fun and more importantly to map functional benefits to consumer benefits. In other words, the key is to understand game mechanics that engage people and map them to desired business or functional outcomes.
Enhanced customer feedback and loyalty
By using gamification, enhanced customer relationship marketing data, financial institutions can target customers according to their specific needs. This may build a bridge over the gap between “product-focused” Financial Services and the growing need to understand the utility of these products in consumer’s lives.
Gamification may very well be a core part of financial institutions retail strategy, improving competitive positioning and building customer loyalty. It is thus expected to significantly increase the scope and scale of Financial Services in the future. Firms that successfully employ gamification will strengthen their competitive positioning and improve economics.