"Ad Agents" is a column written by the agency-side of the digital media community.
Alastair Cole, Head of Creative Services of Essence Digital, a global digital marketing agency based in London and New York.
Do you like to be challenged? You should: problem-solving is human nature and our brains have evolved to reward us when we succeed. And it's this challenge/reward dynamic that lies at the heart of the flourishing gamification market.
Despite its ugly name, this new wave of digital features and functions has become an established business strategy over the last twelve months, and the future looks bright.
The main reason gamification is a success today (and why it's not just another fad) is that it's been part of our everyday lives for decades.
Happy hour at your local bar can be considered an 'appointment dynamic' – get there at a particular time and you're rewarded with cheap drinks. When your tenth skinny latte is on the house, you've probably participated in a 'fixed-ratio reward schedule'.
However, uptake has accelerated in recent months and it feels like a new 'gamified' layer has been added to the web as we know it. This is now a major area of revenue-generation following similar successes in the fields of social and geo-location.
Several key factors have combined to catalyze this recent growth including a continued rise of the global gaming industry and its increasing mass appeal. Also, business operations have moved online because it's more cost-effective and that's where customers are to be found. And finally, a front end of some sort (web or app) is now available on just about every device that has a digital pulse.
What Is It?
Gamification is the process of applying the best elements of gaming to real-world, non-game situations. And it's incredibly effective at creating behavioral change.
The psychology behind it was beautifully demonstrated by VW's Fun Theory in 2009. By turning a set of subway stairs into piano keys, they were able to encourage 66% more people to use them instead of the escalator.
It's common sense that humans are motivated to return to experiences that are more enjoyable and rewarding. Gamification combines three key elements to make everyday actions more fun and engaging.
- Challenges: continually accomplishing small goals in order to reach a larger objective is a key motivation for 'players'
- Achievements: the rewards we receive when successful are at the core of what makes games addictive
- Collaboration: social teamwork and winning with others is innately appealing and easy to facilitate in today's networked world
Benefits to Consumers
Gamification isn't just about having fun - it's also genuinely helping to transform people's lives by making difficult challenges more interesting and achievable. Mint.com has made finance more fun and encouraged 70% of its 6 million customers to set an overall budget.
Health and fitness companies were among the first to adopt these principles, but productivity, health, education, citizenship and environmental causes are now coming on-board. Gartner predicts that a quarter of all daily business processes will be using some aspect of it within the next two years.
Benefits to Marketers
1. Gamification creates new advertising opportunities. It does so by providing a platform for legitimate interruptive messaging and users are happy to be surprised with rewards. Here are three ways advertising can take advantage:
- In-game ads that are aligned with gamer progress. Brands that can deliver their advertising at key moments within games will be rewarded with unprecedented levels of engagement.
- Display ads that are 'gamified.' More interactive adverts will help brands create stronger emotional connections with customers. As this practice develops, competition will drive an increase in the quality of campaigns.
- Ads worth finding and keeping. As digital adverts become more entertaining, users will want ways of collecting them. The best will be eagerly awaited and shared. This will take brand and advertising engagement to a whole new level.
2. Gamification generates new and more exciting data. Deeper consumer engagement provides a wealth of fresh and highly informative data. This data is:
- More valuable. Gamification delivers priceless new metrics including motivational triggers, engagement levels, response times and collaboration insights.
- Higher frequency. Small actions can be accomplished in shorter time frames allowing users to experience progress more often. These 'micro tasks' can all be tracked and measured.
- Greater volume. Games are being played on all manner of devices and the increased interactions they drive leave much larger (and more interesting) data footprints than page impressions or dwell times.
3. Gamification creates engagement at every stage of the customer life-cycle. Brands will always benefit from building emotional connections with consumers - irrespective of when that happens.
- Acquisition. Gamification encourages the sharing of content and recommendations, which greatly enhances social search.
- Engagement. Superior levels of interaction are possible by employing challenge/reward mechanics.
- Retention. More regular and interesting dialogue helps to retain communities through increased loyalty.
Skills and Pitfalls
User experience, interface design and robust development practices are the cornerstones of any gamification project. However, the real skill needed to make it work is a thorough understanding of game design. Without this, it is impossible to create a successfully gamified experience.
Additionally, marketers should do the following to avoid common pitfalls.
1. Ignore bolt-on solutions. The principles of gamification can't be added simply by installing a module. To be successful, the change must be engineered from the inside out.
2. Ensure motivations are 'real.' Badges and leader-boards might help attract new users, but the novelty will soon wear off. Why, when and how rewards happen needs to be considered carefully.
3. Be committed. If you want to be successful, your business goals and customer engagement strategies need to be fully aligned.
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