An Experimental Analysis of Gamification’s Impact on Customer Engagement and Retention in Subscription-Based Business Models

Abstract

This study investigates the impact of gamification on customer engagement and retention in subscription-based business models through a six-week quasi-experimental field study. Using a streak-based gamification mechanism, we compared user behaviour between a gamified experimental group (n = 1,994) and a non-gamified control group (n = 2,107) within a live iOS subscription application. As group assignment followed onboarding status rather than randomisation, the design is quasi-experimental, and the results are interpreted as gamification-associated effects under real-world conditions rather than as strict causal estimates. Results show that gamification was associated with significantly higher engagement frequency, more stable retention, greater time investment per session, and higher conversion to paid subscriptions. At the level of daily aggregates, the experimental group exhibited 3.7 times higher daily goal completion, 4.5 times greater time investment per activity, and a 6.9-fold higher trial-to-paid conversion rate than the control group; complementary user-level analyses confirmed that these effects were broad-based rather than driven by a small number of highly active users. These findings provide ecologically valid evidence for the association between gamification and improved customer loyalty and business performance in digital subscription services. This study contributes to the literature by providing quasi-experimental field evidence linking gamification, engagement, and retention within subscription-based digital services and by demonstrating how engagement functions as a behavioural mechanism through which gamified experiences relate to conversion and long-term user value. Managerially, the results suggest that strategically integrated gamification features can serve as effective tools for improving customer lifecycle outcomes in digital subscription environments.