Gamification and the Future of Mobile Payments

February 26, 2013

Michael HaganGeo-gaming platform SCVNGR launched LevelUp in 2010 in response to a dual opportunity to change the payment landscape for retail brands. For retail customers, LevelUp means unlocking discounts or freebies at cafes, restaurants, workout studios around the country — similar to how Groupon, Lifebooker, Scoutmob and other online deals companies work. However, it is LevelUp’s value-add for the merchant – i.e., small business owners – that sets them apart from the pack.

Chief Operating Officer (or “Chief Rockstar” in the company’s terminology) Michael Hagan explains the concept of LevelUp as “the check-in, the challenge and the reward…in one bite” and underlines two major benefits of their app. One, LevelUp provides an option to avoid costly credit card processing fees that can end up taking a hefty percentage of small business owners’ profits daily. On top of that, LevelUp helps merchants build and strengthen their brand relationships by facilitating mini marketing campaigns which impact each patron individually. Driven by game features which customers play to unlock deals, these campaigns provide merchants a greater opportunity to capture new customers and actively change habit via incrementally better bargains upon each visit.

In a recent op-ed for Fast Company, LevelUp CEO (a.k.a. “Chief Ninja”) Seth Priebatsch attributes the growth of innovative mobile services not to forward-looking companies, but to tech-savvy consumers who place great value on efficiency – whether they realize it or not. These consumers, according to Priebatsch, are the ones dictating market disruption through casual demands, such as more convenient payment methods, security, accessibility to higher education and the ability to personalize online content. Given that viewpoint, it will be interesting to see how LevelUp and SCVNGR continue to respond to this “revolution of consumer choice.”

See Michael Hagan speak about gamification and its effects on the future of mobile payments at our BRITE ’13 Conference (March 4-5, NYC).

BY NANDITA RAY

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