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Many games allow for social encounters to progress into combat ("The bandits seem unimpressed, they draw heirtheir weapons") but not the other way around. Allow the bandit leader to negotiate their surrender after the player kicked a few asses, and give a substantial reward for capturing criminals. Give the player the same option if they end up in a tough spot. Make the difficulty of a fight something that's hard to assess at a glance, but give hints in conversations.

Many games allow for social encounters to progress into combat ("The bandits seem unimpressed, they draw heir weapons") but not the other way around. Allow the bandit leader to negotiate their surrender after the player kicked a few asses, and give a substantial reward for capturing criminals. Give the player the same option if they end up in a tough spot. Make the difficulty of a fight something that's hard to assess at a glance, but give hints in conversations.

Many games allow for social encounters to progress into combat ("The bandits seem unimpressed, they draw their weapons") but not the other way around. Allow the bandit leader to negotiate their surrender after the player kicked a few asses, and give a substantial reward for capturing criminals. Give the player the same option if they end up in a tough spot. Make the difficulty of a fight something that's hard to assess at a glance, but give hints in conversations.

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Rewards

One approach might be to make the NPCs themselves, and their support, resources worth acquiring. Design the incentives and core resources around things that only other characters in the game world can provide. Focus on mechanics that require the NPC to remain alive and friendly towards the player.

  • Perhaps the player has an agenda they need to push, a religion or philosophy they promote, or they're just looking to become famous. Every friend or follower gained increases their influence, which is tied to the main objective(s) and/or character progression.

  • If the game allows for it, let most NPCs be recruited as followers, temporarily or permanently. Balance the difficulty around the player having followers.

  • Let friendly NPCs provide resources or items that are otherwise scarce, and need to be "refilled". Depending on your settings that might be necessities like food and shelter, healing potions, ammunition etc. Make reputation a resource the player can spend on this or resrict access to a positive reputation (as opposed to "they didn't hurt me yet so I guess they're alright.")

  • Tie experience or skill upgrades to bits of information obtained (primarily) from NPCs. Maybe a lot of knowledge has been lost in the apocalypse and most people only know fragments. For example, each NPC could have 2-3 skills they could increase by one point, or a single magic spell they know. If you want to master a skill, you'll have to persuade a lot of people to teach you.

Creative interaction

Some open world RPGs allow you to invest in NPCs to improve their services or make them stronger followers, but that's usually reserved for e.g. store owners or designated party members. You could allow the player to shape most NPCs or factions by "giving back". Allow them to build or name things, give equipment to NPCs, claim areas for them. Most players will care more about a town they helped design than one they're just passing through, and later on, when the villain convinces everyone they're a criminal, they might be more inclined to persuade the guards to let them speak to the council and prove their innocence than to burn it all to the ground.

It's not necessarily either-or

Many games allow for social encounters to progress into combat ("The bandits seem unimpressed, they draw heir weapons") but not the other way around. Allow the bandit leader to negotiate their surrender after the player kicked a few asses, and give a substantial reward for capturing criminals. Give the player the same option if they end up in a tough spot. Make the difficulty of a fight something that's hard to assess at a glance, but give hints in conversations.

Tweaks for "social combat" systems

Physical combat in most games has a few aspects, for example terrain and positioning, that are easy to intuitively understand and can be used without much effort to add depth to a combat system. These aspects are lost if you just copy and "reskin" the same system for social encounters, and technology isn't yet at the level where we can randomly generate compelling dialog (while generating a tilemap is easy). Most (video) games that use this kind of mechanic handle it in a very abstract and often repetitive way.

I'd recommend looking at card games for elements that add a degree of guessing and puzzle solving to your system, or even base the system entirely on a card game (with or without actually rendering/refering to any cards).

Classical card games combine a tweakable randomness with the ability to "out-think" your opponent and can be complex enough to be engaging to play against an AI.

TCG style systems allow the player to collect "cards" (secrets, skills, information, a specific reputation) and use them in combination for synergy effects. Perhaps executing the thief, bringing her to the authorities or letting her go will each give you a different, unique card that can be played later when you encounter the thieves' guild?