Gamification & What it Means for Product Development

By Luke Hymers — Product Manager at Mentally Friendly

I recently read ex-IDEO experience lead and now Bunchball CEO, Rajat Paharia’s ‘Loyalty 3.0’. His book aims to explain how he’s helping his clients use gamification to generate loyalty to their brands, products and services.

Paharia argues many companies are building meaningless loyalty programs, generating nothing but mercenary loyalty based on promises of freebies ‘earned’ from frequent transactions. These programs are easily forgotten and replaced by equal or lesser competitor equivalents with similar benefits. Paharaia has built his business on the basis that considered implementation of gamification can help garner more meaningful relationships between brands and their customers.

Gamification has been somewhat of a buzzword in the business world and having always worked in customer-focused roles, I’ve been among a heap of discussions about it, but haven’t come across many sound understandings, let alone successful adoptions of it. In my experience, a lot of people’s natural thought progression when considering gamification as a way to differentiate is to jump to thinking about how to turn their idea, service or product into a game or game-like experience. It’s an understandable jump, but a common misconception. In reality it’s more often to do with carefully considering how game mechanics can be used to make an experience more engaging and seamlessly weaving them into said experience.

I was compelled to learn how someone had built a highly successful company and career out of something seemingly very few people have a firm grasp on and, as it turns out, games, their mechanics and how we’re able to leverage them in modern products, experiences and services are grounded in behavioural science and have been adopted in more ways than you’d imagine.

Paharia’s approach explains the key links between human motivation and game theories and how they can be used utilised to foster loyalty and engagement.

Let’s get a few key things out of the way:

  • Gamifcation is not always about making games, it’s about understanding the value of your product, your customer’s needs and motivations and using game mechanics to spur repeated, meaningful engagement with your product, service and/or brand.
  • Humans are not motivated by things which are irrelevant to them and lack significance or reason. They are motivated by things that connect with their personal values, goals and aspirations.
  • Loyalty is not fostered through mercenary offerings of free stuff to coax further acquisition of not-free stuff, so one may frivolously obtain more ‘free’ stuff. People catch on. Loyalty is built through meeting needs and helping people reach purposeful goals which can be logically associated with those needs.

Human Motivation

Paharia points out 5 key intrinsic motivators for his ‘Loyalty 3.0’ programs:

  1. Autonomy — Urge to direct our own lives (“I want to control”)
  2. Mastery — Desire to get better (“I want to improve”)
  3. Purpose — Yearning to be a part of something larger than ourselves (“I want meaning/ to make a difference”)
  4. Progress — Desire to see results associated with mastery and purpose (“I want to achieve”)
  5. Social Interaction — Need to belong, be connected to and interact with others (“I want to connect with others”)

The first three form the foundation of Deci and Ryan’s self-determination theory (SDT). The last two have surfaced in more recent behavioural studies as notably powerful additions to broader human motivational theory and are largely supportive to SDT motivators; Progress informs results towards mastery, while purpose and social interaction gives reason to pursue mastery and autonomy.

To put the above into context, just imagine becoming the best in the world at something because you figured out your own unique way to do it and NOBODY knew about it. AHHHH!!!


Those five intrinsic motivators are at the core of gamification mechanics. We are hardwired to be satiated by the fulfillment of these motivators and each mechanic is designed to drive desire for repeated engagement through methods designed to inform and incentivise achievement.

To put it all into context, below I’ve summarised the gamification mechanics, their descriptions and the intrinsic motivators they’re linked to.

Fast Feedback

-Immediate feedback or response to my actions

-Progress, mastery


-See where I and others stand quickly and easily

-Progress, social interaction


-Clear short and long term goals to achieve

-Purpose, progress


-Earn and display evidence of my accomplishments which others can see

-Mastery, progress, purpose, social interaction


-Progress through ranks and achieve status in my community

-Mastery, progress, purpose, social interaction


-Learn quickly and easily in an engaging, compelling way

-Mastery, progress


-See how I’m doing against others and challenge them (directly or indirectly)

-Mastery, social interaction


-Others can help me accomplish my goals

-Purpose, social interaction


-See and engage with others, who can see and engage with me

-Social interaction


-Tangible evidence of accomplishments

-Progress, social interaction

Importantly, throughout the book, Paharia isn’t just talking about loyalty ‘programs’ which I originally thought the book was all about. He’s trying to express how these elements are fundamentally solid foundations to consider for successful product/solution design and development, in turn generating an engaged, loyal user base.

Take eBay as a prime example. Buyers and sellers rate each other (community, transparency). The more they buy, sell and accumulate good ratings on the platform, the higher they rank in the community (levelling up, points, social interaction, community). Their ranking is represented with ‘status flair’, i.e. ‘Power Seller’, ‘Trusted Seller’ etc., on their profiles and listings to build marketplace prominence and buyer and seller confidence (progress, mastery, badges). All previous buyer and seller profiles and ratings history can be viewed (transparency). When bidding on an item, you can see current highest bid (competition) and are notified when your bid is entered, beaten, time is running out etc. (fast feedback, progress, transparency). It’s brilliant.

I will, for example, cross-check sellers on eBay based on the elements mentioned above and they give me confidence I’m safely buying legitimate products. eBay is but one example and the way these elements have been carefully considered and weaved into it are part of what makes it one of the world’s most powerful online marketplaces.

In product design and development, we focus on user needs and goals to deliver meaningful experiences people value. Every goal has a motivation and the key is to develop ways to help motivate people to reach their goals. What better way to motivate people than in a way that’s engaging, rewarding, grounded in behavioural science and even, dare I say it, a little bit fun for them to learn, explore and use? All the while continuously giving them reasons to engage with your product.

It’s also important to note how impactful gamification could be in an increasingly connected future. Imagine the potential of putting more control of preventative healthcare in people’s hands. Using their historical medical data to motivate them to engage in personalised programs based on their individual records and current level of health and fitness.

Throughout the product lifecycle there are opportunities to consider the role gamification mechanics can play in improving how engaging and rewarding products can be for users. And if the result is fostering a more loyal customer base who actually want to use your products and services, not just thoughtlessly leverage them for the promise of an occasional freebie until a competitor seduces them with an equivalently thoughtless, but more timely ‘reward’, then everyone should be considering how they can benefit from effectively utilising gamification.