Playing for profit
'Gamification' is starting to enter the corporate lingo, as companies look for novel ways to engage both employees and consumers.
While many of us tend to think that gaming - whether online or off - is reserved for teenagers and adult 'geeks', this is clearly no longer the case. With the growing popularly of games such as Facebook's FarmVille and the mightily addictive Angry Birds, gaming has gone mainstream.
Whether they are played on smartphones or in the comfort of living rooms, there is no doubt that people of all ages - and of both genders - are falling prey to the addictive nature of today's games. Having recognised this trend, some entrepreneurial businesspeople and software developers have begun to harness the tremendous power of games to make their products and services more appealing to consumers. Internally, gaming principles are also being used to educate and engage staff members and other stakeholders. Indeed, elements of gaming are already being used to such an extent in business that it has even been given its own name: gamification.
Broadly speaking, gamification is the application of game mechanics and game processes in non-gaming environments - primarily to improve the user experience and stimulate engagement (both internally and externally).
Foursquare, the location-based social networking service, is often regarded as the first company to successfully incorporate gamification into its offering. When Foursquare's founders were disappointed by the slow initial take-up of the service, they began to partner with select businesses and offer 'awards' - such as special discounts and virtual 'mayorships' - when users 'checked in' to certain locations. Users quickly began competing for deals and tongue-in-cheek titles, helping the company become a multimillion-dollar success. (It must be noted, however, that in recent months, the company has seen its user base decline, leading it to change fundamental elements of the application's design and concept.)
Nike is a classic example of a big corporate cottoning on to gamification, with its Nike Plus concept miraculously turning jogging (horrors!) into a game of sorts. By connecting runners with a community, Nike Plus motivates people to get off the couch and hit the road to achieve shared goals and get extra kilometres under their belts.
Despite many companies having enjoyed success (and a bolstered bottom line) with gamification, many business leaders are still sceptical of the idea. The concept of creating an award system and doling out virtual badges can appear to be childish at best, and condescending at worst. In addition, many sceptics argue that gaming principles have already been used at work and in business for ages - without us even realising it. Loyalty programmes, for example, incorporate gaming psychology. There is truth in this argument, but we have not seen the concept of gamification being 'commercialised' and adopted for business use to the extent that it is now. Research firm Gartner estimates that. by 2015, 70% of the Forbes Global 2000 will be using gamified apps, and M2 Research forecasts that US companies alone will spend $1.6 billion on gamification products and services by that same year.
So how does one take advantage of this trend and make sure that gamification doesn't only entertain, but engenders plumper profits?
Another important aspect for businesses to consider is that games need to be tested and adaptable. Human behaviour is rarely predictable, which means it's tough to assume how people will respond and behave.
According to the digital strategists, if you have a clear idea of both the business objectives and the audiences being targeted, you can develop a strategy that incorporates select elements of gaming to serve your needs.
"Gamification can be used in any situation where you want to modify the behaviour of people who run or interact with your business," explains Antonio Petra, head of strategy and insight at Native, a local digital agency. "So it can be used to motivate a sales team, embed a methodology or process among staff, or to control the way customers engage with your company."
Other uses include motivating groups of people to help you design solutions or processes for your business, and scenario preparation (in the same way armies use war games to prepare soldiers, or pilots trained in flight simulators).
"Games have been used to identify crowdsourced solutions to problems," adds Petra. "Examples of this include generating solutions around environmental issues, and experimentation into human behaviour."
Local businesses are beginning to follow international counterparts by experimenting with the concept. For example, the personal financial management platform 22seven, led by entrepreneur Christo Davel, incorporates elements of gamification to make money management more enjoyable and attract visitors to the company's Web site. Taxtim, an online tax assistant - although still in the early stages of development - uses characteristics of gaming to make the usually dull task of filling out tax forms more user-friendly and endurable.
"Our interface provides feedback, is responsive, provides encouragement and tracks progress, but we stopped there because completing your taxes is not a process that needs to be made 'fun' - it just needs to be intuitive and bearable," explains Evan Robinson, director and CTO of Taxtim.
"Most businesses stand to benefit from responsive, engaging interfaces that are simple to use," he adds. "But any concept that requires user-generated content to stay afloat should make use of game psychology."
The key to using gamification successfully, says Craig Rodney, MD of Cerebra Communications, is to accurately identify the behavioural outcomes you wish to encourage, and the necessary incentives that will promote that behaviour.
"If it's a positive behaviour and strong incentives, then the game should work," he explains. "There's naturally a lot more to it because game design can be complex and involves psychology, behaviour, economics, decision process, etc. There are a lot of forces at work at the same time. You can't just apply a game layer on top of something.
"Another important aspect for businesses to consider is that games need to be tested and adaptable. Human behaviour is rarely predictable, which means it's tough to assume how people will respond and behave."
Indeed, human behaviour and the psychology of gaming - not necessarily the design of the games themselves - are what make gamification such a potentially powerful tool for businesses. When something is turned into a game (or at least appears on the surface as such), humans are much more likely to be responsive and pay attention. So how much of it is technology, and how much psychology?
Renowned 'gamification guru' Gabe Zichermann has pointed out on his blog that: "...it's probably more like 75% to 25% psychology to technology". That said, it is still critical for the applications themselves to be well designed, relevant and compelling.
"Clutter in media, an overexposure of the wrong information, and just generally busy lives mean people increasingly need more of a reason to actually take action," warns Rodney. "The learned human behaviour through our childhood means that we all intrinsically 'understand' gamification and are naturally drawn to it."
This is good news for businesses that are, admittedly, not interested in fun and games, but in financial gain.
First published in the December/January 2013 issue of ITWeb Brainstorm magazine.