How Ethora implement gamification to increase user retention

Customer retention is a matter of survival for your app. If users don’t stay, you just can’t keep up with competitors. One of the most effective ways to keep users active is by creating an emotional connection with your app. Gamification can help you achieve this. It can be a real game-changer, boosting customer loyalty up to 48%.

If you’re wondering how to increase user retention through well-designed engagement loops, you can do it with Ethora. Read on to learn more.

What is Gamification and Why It’s Important

Gamification refers to the implementation of game elements within an app, such as scores, leaderboards, levels, and achievements. It transforms routine interactions into more fun experiences. 

One of the greatest examples of this is the language-learning app Duolingo. Because of the tedious learning process, educational apps have one of the lowest retention rates. The Duo team made the process fun, adding leagues, leaderboards, and rewards. This increased its next-day retention rate from 13% in 2012 to 55% in 2019. This demonstrates how gamification can be a real engagement booster.

Effective Gamification Strategies for Business

It may seem that gamification will work for educational or sports apps, but for finance, business apps, or many others, it won’t do much good. Truth be told, simply adding a leaderboard or rewards may not work. For it to be effective, you need to know how to use gamification strategies.

The main rule is that gaming features should feel natural. For example, with Ethora, you can embed gamification directly into actions people already perform, such as chatting, contributing, completing profiles, and participating in communities. These may be some points for completing profiles or badges for meaningful actions in communities (e.g., reporting spam, helping other members, etc.) This allows you to align game mechanics with real business goals: better onboarding, higher activity rates, stronger communities, and deeper user relationships.

Gamification is suitable for both internal and external users, so you can use it for customer communities, marketplaces, learning platforms, employee training, and enterprise applications alike. For example, Deloitte integrated gamification into their leadership training program. Their research also claims that companies using game elements in their training programs witness 50% increase in employee engagement rates.

Increasing Engagement Through Gamification

Fun interactions are more pleasant, but besides this, how does gamification increase user engagement? Let’s look closer at what really motivates us to return to our favorite apps. 

The plain truth is that we’re addicted to dopamine. Game elements in apps, whether it’s bank cashback or bonus points for booking an apartment before another travel, give us instant gratification. But that’s not it, as we people are more complicated than this. Here’s what we can add:

• The sense of progress. For instance, when we see a progress bar showing our profile is completed 80%, this creates a cognitive itch to reach 100%. Moreover, breaking a long journey into small levels makes the faraway goal less daunting and more achievable
  
• Social dynamics. One more day of learning or a completed sports marathon? We want to share our achievements with others, thus validating our efforts. Additionally, seeing the results of other people and sharing your own creates a sense of community
  
• Competition. Seeing that you need just a few extra points to move up on the leaderboard pushes us to put a little more effort
  
• Limited-time offers. We are afraid to miss out on good opportunities. “Countdowns” create a sense of urgency, making us act quickly

The benefits of gamification for keeping users are undeniable. We like to gather cashbacks or bonuses, we don’t want to lose our 100-day streaks, and we like to share our achievements with people with similar interests. All of this motivates us to stick to the app.

But there’s one thing that’s crucial to remember: gamification works best when it enhances a core value. If the underlying product isn’t useful, “slapping a leaderboard on it” will only feel like a gimmick and can lead to gamification fatigue.

Motivating Users with Rewards and Challenges

There are many ways to implement rewards and challenges into your chat app. This may be some kind of a competition, when participants receive experience points for activity, or granting tiered roles (newcomer – chatter – legend, etc), or offering “coins” for daily check-ins that can be then spent on premium features.

Mechanics like consistency streaks, unlockable “flair” (e.g., custom themes, exclusive stickers, etc), and merit-based badges, can turn routine communication into a series of rewarding milestones. And this does more than just inflating metrics.

Game-like features foster “digital stickiness” by giving users a sense of progression and identity within their social circles. When a user sees a rare badge next to their name or maintains a month-long streak, they aren’t just sending messages – they are building a digital legacy, making the cost of switching to a competitor far higher.

Maintaining Long-Term User Interest

When a game doesn’t change, you may not want to play anymore. To prevent fatigue you need to constantly develop your loyalty program, challenges, and rewards. Thus, experience won’t become boring, which can result in fewer interactions and drop-offs.

Designing Retention Programs and Mobile Gamification

To achieve the best results, you need to design gamified retention programs that align with your audience and product goals. The task here is to customize gaming elements to create purposeful experiences.

Instead of superficial points and leaderboards, implement tiered loyalty rewards, daily progression milestones, and personalized challenges. Embed these mechanics right into your customer’s journey, thus aligning games with their intrinsic goals and ensuring that interactions create a sense of accomplishment. For mobile apps, gamification helps minimize one-time downloads by creating a long-term habit.

Impact of Gamification on Loyalty and Retention Growth

The impact of gamification on customer loyalty is rooted in the transition from a transactional relationship to an emotional one. When users engage with game-like elements, they move from being passive consumers to active participants, which significantly boosts brand affinity.

To understand how to increase user retention, one must look at the “endowment effect” – the psychological phenomenon where people place a higher value on things they have worked to build.

Unlocking milestones and climbing leaderboards play a more significant role than just having fun. They develop a sense of ownership over their profile and achievements. This creates an emotional barrier, preventing users from churn. Gamification creates a unique experience for every customer, building a foundation for long-term retention. This also directly impacts your bottom line, as just 5% retention can boost your profit by 25%-95%.

If you’re ready to implement game-like elements into your chat apps, you can do it with Ethora. Our SDK is flexible and customizable, so you won’t have any difficulties aligning game features to your customer journey. Moreover, it will save you a lot of time and effort, because with Ethora Chat SDK you can build chatting apps in days, instead of months. Try it now for free.

More from Ethora: Ethora chat SDK, Ethora AI SDK.