Gamifying Referral Programs: Exploring The Tier Unlocking System Applied To Tidal

The impact of referrals to the growth of startups can not be downplayed. Whether structured or not, referral have shown to be effective in driving user acquisition, and ultimately business growth. The fact remains that as startups push towards their north star growth metrics, it is inevitable to explore all weapons in the marketing armoury - an important one being referrals. In fact, this is one strategy that has always been around, simply evolving in form, however the function remains the same. Having said this, I must also emphasize the forms vary and are very much tied to the industry, product/service in case, and executing team amongst other factors. Another fact I must also mention is that acquiring users to a product or service require finesse, adaptation and creativity - You are by no means confined to traditional approaches to these things.

So why is any of these even necessary? My answer to this is simple, and it is this; the users you seek are also being sought by others - you need to give them a reason to choose your product or service. User acquisition is now so much a game of tact, but while wooing, engaging with, and providing value to the identified end users and customers.

Now having made this much clearer, let's attempt to explore something exciting - Gamifying referrals and creating engagements as tools for user acquisition. I must also state that referrals as a facilitating approach for user acquisition is and has always been efficient whether pre, during, or post launch.

Let's get to the crux of the matter - gamifying referrals. This strategy has gained significant traction in recent years. What it does in essence is it transforms the traditional refer-a-friend model into an engaging, game-like experience that taps into people's innate competitive nature and desire for exclusivity. At the heart of this strategy lies a multi-tiered unlocking system, where each tier offers increasingly valuable rewards and exclusive perks.

The fundamental idea behind a gamified tier unlocking system is Incremental Incentivization - the idea that something is obtained by the referring member for the act of referral; and/or a new level is attained in the ecosystem for doing certain tasks that bring in others to the system. This also inherently ties into creating a structured progression path for users. In this approach, participants start at a base level and can advance through various tiers by completing specific actions that benefit the product or service. These actions primarily revolve around referring friends but can also include other valuable behaviours such as sharing content, providing feedback, or engaging with the product in meaningful ways. In this system, as users progress through the tiers, they unlock increasingly attractive rewards and exclusive benefits.

This creates a powerful incentive for continued engagement and referrals, as participants are always striving to reach the next level and thus reap its associated perks. At the crux of this whole narrative is the fact that instead of implementing a simple program that allows users draws in x number of other users, the gamified tier unlocking system somewhat creates an environment where a user ultimately draws in (x by n) number of users - resulting in massive growth of the product or services’ user base. The catch of course in this case being that it has been gamified.

Gamification has revolutionized the way referral programs engage and motivate users, driving impressive success when executed effectively. The core strength of this approach lies in its ability to tap into human psychology, leveraging intrinsic motivations such as competition, status, and achievement. When one transforms the referral process into a game-like experience, what inherently happens is that a dynamic and engaging environment where users feel a sense of accomplishment as they progress through different levels is created - with long term benefits for the hosting brand. This tiered system, complete with visible progress and rewards, keeps users motivated and eager to reach the next level, unlocking new perks along the way.

One of the most compelling aspects of gamified referral programs is the provision of clear, tangible benefits at each tier. Unlike traditional referral systems that often rely on a one-time reward, gamification introduces a series of concrete rewards that users can look forward to as they advance. This clarity in the value proposition enhances the appeal of participating in the referral program, making it much more attractive to users. In addition to this, the structured nature of the rewards also adds an element of predictability and reliability, ensuring that users know exactly what they stand to gain from their efforts.

As users progress through the various tiers, they then develop a deeper sense of investment in the program and, by extension, in the product or service being offered. This sense of progression fosters a stronger emotional connection to the brand, as users become increasingly committed to achieving higher levels of success within the referral system. The gamified approach thus creates a virtuous cycle where the more users engage with the program, the more invested they become, leading to even greater levels of participation and loyalty.

In far contrast to this, traditional referral programs, which often result in one-off actions; gamification encourages ongoing engagement. Users are not merely incentivized to refer a friend and then move on; instead, they are motivated to continue referring and interacting with the product to maintain or improve their tier status. This continuous engagement ensures that the referral program remains top of mind for users, driving sustained participation and long-term success.

The success or otherwise of a gamified referral campaign is very much dependent on how the system is conceived, implemented, and rewards allocated. However, because these users being sought certainly are living entities with feelings, preferences, taste and many other self defining factors, any startup seeking to explore referrals must be ready to go all out. This in itself comes with this one key benefit amongst the many others - Engagement. You score a good point at building a very engaged community of users, and except I am missing something, this is certainly what every startup wants.

Now, to implement this strategy effectively, several key components would have to be incorporated or attended to;

Progress Tracking (I dare say it must be visually appealing in its implementation).

A crucial element of any gamified system is providing clear visual feedback on progress. This would usually require the design of some kind of engaging interface that clearly shows users how close they are to the next tier, what actions they need to take to advance, and what rewards await them at each level. This constant visual reminder serves as a powerful motivator for continued engagement.

Consider using progress bars, animated graphics, or even virtual landscapes that evolve as users advance. The more intuitive and visually striking the progress tracker is, the more likely users are to remain engaged with the program.

Clearly Defined Tiers with Exciting Rewards

Tiers would need to be structure in a way that creates a sense of achievement and exclusivity. Standard practise says each tier should have a distinct name and identity, with rewards that become progressively more valuable and desirable. To provide clearer insights to this, here is an example of how a SaaS company launching a new product, let's say it could be a productivity tool, might structure their tiers:

1. Tier 1 (Novice): Access to basic features, maybe a 10% discount at launch (This could also be something else).

2. Tier 2 (Pro): Early access to the platform, 25% discount, exclusive webinar with productivity experts (inclusive of top management).

3. Tier 3 (Expert): Beta testing opportunity for new features, 40% discount, personalized 1-on-1 onboarding session.

4. Tier 4 (Master): Lifetime discount, co-creation session with founders, name featured in product credits.

Now, the key here is to ensure that each tier offers tangible benefits that align with your users' interests and needs (whatever those might be). This could include product discounts, exclusive features, early access to new releases, or even physical rewards for top-tier participants.

Time-Limited "Power-Up" Periods

To add an extra layer of excitement and urgency, implement time-limited "power-up" periods where certain actions yield greater rewards. For example, during these special events, referrals might count double towards tier progression, or users might have the chance to unlock special bonuses not available at other times. These limited-time events based on practice creates a sense of urgency and encourages users to act quickly. They also provide natural opportunities for re-engaging users who may have become less active in the program. You may want to consider aligning these power-up periods with relevant dates or milestones for your business to maximise their impact. An interesting case to this exploration would be Telegram based tap games - they practically use this amongst many other growth configurations.

Social Sharing of Achievements

An important component to referrals, wherever they are being used as growth strategy, is the leveraging of the power of social proof. This you do by enabling and encouraging users to share their achievements on social media platforms. Practically speaking, you will need to create visually appealing, shareable graphics for each tier upgrade or significant milestone. When users share these accomplishments, they not only feel a sense of pride, but also indirectly promote your product to their network. Another advice would be to make the sharing process as seamless as possible, with pre-written messages that users can easily customise. You might even offer small bonuses or accelerated progress for users who consistently share their achievements, further incentivizing this behaviour.

Leaderboards and Competitions

To drive up some kind of artificial competition, you may want to tap into users' competitive spirit by implementing leaderboards that showcase top referrers. In doing this, you can create overall leaderboards for all-time top performers, as well as time-based rankings (e.g., weekly or monthly champions) to give more users a chance to shine. You may also want to consider segmenting leaderboards by region, user type, or other relevant categories to create more opportunities for recognition. Periodically, you might also want to organise competitions or challenges with special rewards for the winners, adding another layer of excitement to the program.

So I have decided to build a hypothetical referral structure for Tidal - The Music Streaming Service. We would assess its existing referral program and then benchmark it against one we would create. But before we do this, here is a brief about Tidal.

Tidal is a Norwegian-American music streaming service that was launched in 2014. It distinguishes itself in the competitive music streaming market by focusing on high-fidelity audio quality and exclusive content. Here are some key points about Tidal:

1. Audio Quality: Tidal is known for offering lossless audio quality, with its HiFi tier providing CD-quality sound (16-bit/44.1kHz) and its HiFi Plus tier offering even higher resolution audio (up to 24-bit/192kHz).

2. Ownership: Initially launched by Norwegian company Aspiro, Tidal was acquired in 2015 by a group led by rapper Jay-Z. In 2021, Square (now Block), led by Jack Dorsey, acquired a majority stake in Tidal.

3. Artist Focus: Tidal emphasizes fair compensation for artists and has positioned itself as an artist-friendly platform. It claims to pay the highest percentage of royalties to music creators in the streaming industry.

4. Exclusive Content: The service often features exclusive releases, music videos, and live streams from major artists, particularly those associated with its ownership.

5. Curated Playlists: Tidal offers expertly curated playlists and personalized recommendations based on users' listening habits.

6. Global Reach: While not as large as some competitors, Tidal is available in over 60 countries worldwide.

7. Integration: Tidal has partnered with various audio equipment manufacturers to integrate its service directly into high-end audio systems.

8. Tidal X: This feature offers subscribers access to unique experiences like concerts, meet-and-greets, and other music-related events.

9. Video Content: In addition to music, Tidal also offers a selection of music videos, live performances, and original video content.

10. Subscription Model: Tidal operates on a paid subscription model, without a free, ad-supported tier like some of its competitors.

Now that we know a bit about Tidal, let's look out how it could benefit from a tiered referral program.

Tidal's Current Referral Program

Existing users can invite friends to try Tidal.

If the invited friend signs up for a Tidal HiFi Plus plan, both the referrer and the new user gets 30 days of free service.

This offer is limited to 5 successful referrals per account.

The fact is that while this program provides some incentive for users to refer friends, it lacks the engaging and dynamic elements that could drive more significant growth. So let's reimagine this program using a gamified tier unlocking system.

Proposed Gamified Tiered Referral Program for Tidal

Tier 1

1. 30 days free Tidal HiFi for each successful referral (up to 5).

2. Access to exclusive Tidal X playlists.

Tier 2

1. 45 days free Tidal HiFi for each successful referral (up to 5).

2. Early access to select album releases.

3. 10% discount on Tidal merchandise.

Tier 3

1. 60 days free Tidal HiFi for each successful referral (up to 5).

2. Exclusive artist meet-and-greet opportunities (virtual).

3. 20% discount on Tidal merchandise.

4. Priority customer support.

Tier 4

1. 90 days free Tidal HiFi for each successful referral (up to 5).

2. Backstage pass to Tidal X concerts (when available).

3. 30% discount on Tidal merchandise.

4. Beta testing for new Tidal features.

Tier 5

1. 6 months free Tidal HiFi for each successful referral (unlimited).

2. VIP access to Tidal events and concerts.

3. Custom playlist curated by a Tidal-affiliated artist.

4. Opportunity to be featured in Tidal's "Fan Spotlight" series.

5. Limited edition Tidal-branded high-fidelity headphones.

Progress Tracking

Implement a visually appealing interface within the Tidal app that shows users their current tier, progress towards the next tier, and available rewards. This could be designed as a musical journey. It would be so lovely to see each tier represented by a different musical instrument or genre icon.

Clearly Defined Tiers with Exciting Rewards

Drawing from the tiers outlined above, each tier should offer progressively more valuable rewards that align with music lovers' interests: from extended free trials and merchandise discounts to exclusive experiences with artists and VIP event access.

Time-Limited "Power-Up" Periods

Tidal may want to introduce "Amplify Weeks" where referrals count double towards tier progression. These could coincide with major music events like the Grammys, Coachella, etc, creating a sense of urgency and excitement.

Social Sharing of Achievements

Enable users to share their tier achievements on social media with custom Tidal-branded cartoonized graphics (maybe). For example, reaching "Harmony Hero" status could generate a shareable graphic featuring the user's top played artists.

Leaderboards and Competitions

Implement monthly "Top Curator" leaderboards, showcasing users who've made the most successful referrals. Winners could receive special recognition, like having their playlists featured on Tidal's homepage.

The insights shared above as to this gamified approach certainly (as I see it) transforms Tidal's basic referral program into an engaging, multi-faceted experience that appeals to music enthusiasts' passion for discovery and exclusive experiences. As a standard, tiered structures provide clear goals for users to strive towards, with each level offering increasingly valuable rewards. The thinking here is that when a mix of tangible benefits (free months of service, merchandise discounts) and exclusive experiences (artist meet-and-greets, VIP event access) are put together, the program transforms even further and caters to a wide range of user motivations.

Now imagine that this program is built-in with fancy aesthetics and all - you can be sure the age bracket 15-30 will be sold outright. Now I do believe that this gamified approach not only has the potential to significantly increase Tidal's user acquisition through referrals but also to enhance user engagement and brand loyalty. The referral program now turned into a rewarding journey filled with music-related perks and experiences, no doubt sets the platform unto another league in its community growth journey.