How gamification creates engaging and durable interactions with customers
Insurance firms can apply the elements that make games enjoyable and motivating to engage with customers more frequently and effectively. Known as gamification, this approach can also help to cut costs.
In recent years, gamification has emerged as a dynamic marketing tactic used by consumer brands. New interactive technologies enable brands to build game-play elements that fuse the digital and real worlds into their promotional campaigns. This stimulates consumer engagement with a product or service through task-based challenges, which promise different discounts, rewards and incentives based on performance and achievement.
Gamification is becoming a hot topic among insurers: “Gamification has not yet taken off for insurance, but it is an issue under discussion,” says Maria Pelkonen-Hall, Digital Innovation Manager, L&H Digital Business Accelerator, Hannover Re UK Life Branch. “Insurers are looking closely at how gamified interactions can enhance engagement with customers, and how to make the best use of the metaverse for the future.”
Life and health are areas where gamification can best deliver benefits for insurers and customers. “In life and health, engagement usually occurs only when customers apply or when they claim – but during the period in-between there aren’t enough touchpoints,” she adds.
Gamification: powered by wearable devices
As more people use wearable devices to track their fitness and wellbeing, this creates gamified opportunities for insurers to build long-term customer relationships. “Customers are increasingly interested in lifestyle and health issues, but there needs to be a direct connection for them to insurance. Developing gamified activities to keep people engaged with their health tracking over a longer period of time will provide new opportunities related to physical and mental health in insurance,” says Maria Pelkonen-Hall.
“Exploring personal data, and understanding at a deeper level the value and benefits of that data, can make a positive difference to people’s lives,” says Oliver MacCarthy, Head of Design at Tictrac. A UK-based health-tech platform and content service, Tictrac enables people to achieve positive outcomes in their physical and mental wellbeing.
The key to developing effective gamification is to focus on human behavioural science: “Gamification applies the elements that make games engaging, enjoyable and motivating to experiences that are not games,” says Oliver MacCarthy. “We are building a digital service that helps people to make healthier choices every day. If we take what we know from games, we can make the process of making healthy choices more enjoyable and more beneficial.”
Making healthy choices more fun
Designing gamified experiences that motivate people to take potentially life-changing actions in the real world is harder to achieve than in the digital world, where people often play games simply to escape the realities of everyday life.
The secret is to make healthy choices enjoyable for their own reasons and encourage personal ownership. “What makes a game enjoyable and engaging is that you embark on a journey with an overarching mission, even if it will take a long time to get there. Along the way, you learn skills, achieve certain goals and feel achievement. It’s about owning your journey, creating your own path through the available options and generating value,” says Oliver MacCarthy.
Rewards are used to help customers to transition from extrinsic to intrinsic motivation. This means enticing people to adopt enough of the healthy behaviours to see that they are progressing towards their big-picture health goal. Over time, the need for rewards is reduced as intrinsic motivation kicks in and customers feel they own the path to improving their personal health.
“With Hannover Re, we are taking the preventative health proposition and layering on top a special type of reward that is aligned with the end-user’s health and wellbeing,” says Oliver MacCarthy. “If you are behaving more healthily, you can earn a discounted life insurance premium. That means you understand that what you are doing is having a positive impact on your future health, which is good for motivation. In addition, you are getting monetary value, which strengthens both sides of the intrinsic and extrinsic equation.”
Benefits: more engagement, lower costs, loyal customers
The benefits for insurers include more health-aware and engaged customers. “If you are helping your customers to take better preventative care of their health, they are less likely to make a claim – or if they do submit a claim, it is likely to involve lower cost than it would otherwise do,” says Oliver MacCarthy. “And if they are enjoying the experience with you because you are helping them to achieve positive outcomes in their own lives, customers are more likely to stay loyal.”