Latest / The CMO Podcast with Fexingo: Marketing Leadership, Budgets, and Executive Strategy / How CMOs Use Branded Games for Customer Loyalty
Transcript
- Lucas: So Luna, when was the last time you played a game on your phone that was actually from a brand — not Candy Crush or Wordle, but something tied to a loyalty program? Luna: Honestly? I played Starbucks' 'Starland' game last month. They had this whole Monopoly-style board where you earn stars and collect pieces for a chance at free drinks. Lucas: Exactly. And that's a perfect example of what more and more CMOs are betting on: branded games embedded in loyalty programs. It's not just about points anymore — it's about play. Starbucks reported that during their 'Starland' promotion in early 2025, daily active users on their app jumped by over 20 percent, and redemption rates for rewards actually increased. Luna: So the game didn't just drive engagement — it drove behavior. People were visiting more frequently just to collect pieces. Lucas: Right. The whole thesis is that game mechanics tap into something deeper than a transaction. You're not just buying a latte; you're advancing on a board, you're building a collection, you're competing against yourself or friends. And for the CMO, that means more repeat visits, more data, and more emotional stickiness. Luna: But there's a risk here, right? I remember when McDonald's had the Monopoly game, people got obsessed, but then there was that whole scandal with the fraud ring. And even without fraud, there's the question of whether it actually builds long-term loyalty or just trains customers to wait for the next promotion. Lucas: That's a real tension. The data on McDonald's Monopoly is interesting — when the game is running, same-store sales can lift by 5 to 10 percent. But the moment it ends, those gains often reverse. So the challenge for CMOs is to design a game that doesn't feel like a short-term sugar rush. Starbucks' approach is smarter because it's integrated into their existing loyalty ecosystem. You earn stars for purchases, and the game is an overlay — it doesn't replace the core value proposition. Luna: So the game is a bonus, not the main event. That makes sense. What about Nike? They've been doing this for years with the SNKRS app. Lucas: Nike SNKRS is a masterclass. The app uses scarcity and surprise — you enter 'drops' for limited sneakers, and the app gamifies the whole process with storylines, countdowns, and even augmented reality experiences. The result is that Nike doesn't just sell shoes; they create a cultural hunt. And it feeds directly into their membership program. According to their last annual report, SNKRS members spend more than twice as much per year as non-members. Luna: But again, that's a limited-edition model. Not every brand has the luxury of scarcity. What do you do if you're, say, a grocery chain or a hotel? Lucas: Great question. For brands without natural scarcity, the game has to focus on frequency and discovery. Think of something like the Marriott Bonvoy Moments program — they use auctions and experiences as a gamified reward layer. Or for CPG brands, there are apps like Ibotta that turn grocery shopping into a game of scanning receipts for cash back. The key is aligning the game mechanic with the core behavior you want to drive: repeat purchases, trial of new products, or deeper engagement with the brand story. Luna: And what about the data side? One of the biggest selling points for CMOs is that games collect zero-party data — users willingly share preferences and behaviors to play. Lucas: Exactly. When someone plays a branded game, they're telling you what they like, how they make decisions, even their risk tolerance. That data is gold for personalization. Starbucks uses the game data to tailor offers in real time. If you always pick the 'free pastry' piece, they know you're more interested in food than drinks. But you have to be careful with privacy — especially as regulations tighten. The best programs are transparent about what data they collect and give users control. Luna: So where do you see this going next? Are we going to see more virtual reality or augmented reality games? Lucas: Absolutely. IKEA already has an AR app that lets you place furniture in your home, but imagine if that was turned into a game — like a scavenger hunt where you get discounts for finding virtual items in-store. A few retailers are experimenting with that. Also, I think we'll see more 'branded worlds' in platforms like Roblox and Fortnite. Gucci had a virtual garden in Roblox that generated millions of visits. It's essentially a game that's also a store. Luna: But not every brand can afford to build a Roblox world. What's the minimum viable version of a branded game? Lucas: Start small. You don't need a full app. A simple digital scratch card or a spin the wheel mechanic on your website can work, especially if tied to a loyalty program. The key is to make it feel rewarding, not like a gimmick. One travel brand I saw used a 'mystery destination' game — you book a trip and get a random surprise upgrade. That's low-tech but high-engagement. Luna: I like that. It also creates social sharing moments — people love posting about winning something unexpected. Lucas: Right, and that's another benefit: organic amplification. When someone wins a free coffee because they completed a game, they're likely to share it on social media. That's earned media that you don't have to pay for. In fact, Starbucks estimated that their 'Starland' game generated over a million social mentions in the first week alone. Luna: That's impressive. But let's talk about the downside. What about reward fatigue? If every purchase comes with a game, doesn't it start to feel like a casino? Lucas: It can, if you're not careful. The key is to keep the game fresh — rotate mechanics, introduce new challenges, and avoid making the rewards feel like the only reason to buy. The best branded games enhance the brand experience rather than replace it. For example, Patagonia runs a 'Worn Wear' program that gamifies sustainability — you get points for sending in old gear to be repaired. That feels authentic to their mission. Luna: So the game has to be on-brand. If you're a luxury brand, you probably don't want a flashing slot machine. Lucas: Exactly. For luxury, the game should feel exclusive and elegant. Think of something like a private members' club with a digital treasure hunt for high-spenders. Hermès does something like that with their 'Petit h' platform — you can discover and customize products through a playful interface. It's still a game, but it's quiet and sophisticated. Luna: I want to go back to the data point about Starbucks' daily active users jumping 20 percent. Was that sustained after the promotion ended? Lucas: That's the million-dollar question. According to their quarterly filings, the app retained about 60 percent of that lift three months later. So there was some stickiness, likely because users had formed a habit of checking the app more frequently. That's the ideal outcome — the game serves as a catalyst for a new habit. Luna: And if that habit sticks, the ROI on the game can be enormous. A few million to build and run a game, versus the incremental revenue from customers who now visit twice as often. Lucas: Precisely. And that's why more CMOs are allocating budget to this. I've seen some brands set aside 5 to 10 percent of their loyalty marketing budget specifically for gamification experiments. The ones that succeed often scale it quickly. Luna: Speaking of scaling, what's your take on the backlash some brands face when they introduce gamification? There was a recent case where a grocery chain added a game to its app and customers complained it was manipulative. Lucas: That happens when the game feels like a trick rather than a gift. The key is transparency. Be clear about the odds of winning, don't hide terms, and make sure the game doesn't slow down the checkout process. If a customer feels pressured to play to get a fair deal, you've lost trust. The best games are opt-in and genuinely fun. Luna: So what's your advice for a CMO today who's considering adding a branded game to their loyalty program? What's the first step? Lucas: First, identify the core behavior you want to drive: is it frequency, basket size, new product trial, or something else? Then pick a simple mechanic that aligns with that behavior. Start with a low-cost pilot using a third-party platform like Influitive or Badgeville. Measure engagement and repeat purchase lift. If it works, you can build something custom. And always have a clear exit strategy — if the game doesn't move the needle, you need to be willing to cut it. Luna: And if it does work, you've got a new competitive advantage. Because once a brand builds a game that customers love, it's hard to copy. Lucas: That's the secret sauce. The game becomes part of the brand experience itself. Like, think about Starbucks Rewards — the stars are almost a currency, and the game adds a layer of entertainment. It's not just a loyalty program; it's a relationship. Luna: And if these marketing conversations have sparked something you've actually used in your own work, honestly, if today was worth a coffee to you, that's the link — buy me a coffee dot com slash fexingo. Lucas: Yeah, it's a simple way to keep the show ad-free and accessible. And we really appreciate it when listeners chip in. Luna: So back to branded games — I think the biggest takeaway is that it's not about the game itself, but about deepening the customer relationship. The game is just a tool. Lucas: Exactly. And as technology evolves — with better AR, more personalized AI, and deeper integration with everyday life — the possibilities will only grow. But the fundamentals stay the same: make it fun, make it on-brand, and make it rewarding for both the customer and the business. Luna: Well said. And on that note, I think we're out of time for today. Lucas: Thanks for listening, everyone. We'll be back next time with another deep dive into the strategies that matter for marketing leaders.