By Yasmin Razavi, Bernard Ho and Mark S. Fox
Introduction and Motivation
Customer loyalty has been an ongoing concern of retail companies and with the onset of the internet it has become even more important. The internet has led to decreasing loyalty among consumers due to price transparency and the ease of switching from one online store to another compared to typical brick and mortar stores.1 The price for retaining customers has risen and doing so has become exceedingly difficult.2
The internet has made it easier for people to connect with one another. Physical distances and boundaries have dissipated and friends and individuals are more connected with social tools such as Facebook and Twitter.3 Online forums have been fostering the development of people sharing thoughts on products they have bought, or providing advice for individuals interested in purchasing a product or service. However, these forums have yet to reach their full potential of direct integration with e-commerce platforms and explicitly driving online sales. The successful integration of the aforementioned entities hinges on incentivizing users to create and consume product-related content in a revolutionary manner. This paradigm shift can effectively be catalyzed and enforced through a new concept: gamification. This article explores how loyalty has changed in the internet era and how gamification applications in e-commerce can induce e-loyalty amongst consumers.
What is Loyalty?
There is no widely accepted definition of loyalty. The commonly understood definition would solely be based on the repeat purchases from a particular brand; however, more recently loyalty has been viewed from three varying angles: loyalty as an attitude, loyalty as a behaviour and loyalty as a function of circumstance.4
Attitudinal loyalty revolves around the customer’s belief and attitude towards a brand.5 Apple Inc.’s highly controversial ‘Mac vs. PC’ marketing campaign is an example of the effort made by Apple to instigate a sense of belonging to an elite or exclusive community in their customers.6