Benefits Of Branded Gamification — Is Losing A Problem?

We’re quite familiar with all the reasons brands choose to introduce gaming elements to the customer experience. But do they outweigh the cons?

Starting with a clear definition: Gamification is not the invention of games in order to solve a business or customer need. It is the integration of game playing elements into existing processes — whether a website, an app or even an online community — to “pull” customers through encouraging greater participation, engagement and ultimately loyalty.

Examples of gaming elements could be:

Leaderboards (Swarm: checking in to locations more regularly places you higher on a leaderboard, Nike: personal best running times shared within community to compete on a leaderboard)

Badges (Booking.com: contributing more regularly to their Partner Forum results in unlocking accomplishment badges, BlaBlaCar: Gaining greater ‘experience’ levels with greater use and positive reviews from other users)

Accumulative rewards (Starbucks: collecting stamps for a free coffee, Techniker Krankenkasse Insurance: collect points through staying active and healthy to exchange for treatments, discounts of services such as gym membership etc.)

Gamification differs from simple reward programs as it comes with reward and risk. There’s always a risk of not getting the reward you want, not getting any reward, dropping down the leaderboard, losing points or breaking winning streaks etc. For simplicity, we’ll refer to these and any other negative outcomes of playing a game as “losing”.

This can be off-putting to some brands, especially those looking to offer a top-notch customer experience.

We will explore whether the benefits gained from a brand experience with gamified elements is worth the risk of losing, and if it affects how the customer views the brand.

How does brand gamification benefit customers?

When it comes to gamifying touch-points in the customer journey, there’s a number of benefits brands can offer their customers as a result. These include:

Giving back in the form of rewards

This is simply displaying appreciation, and everyone likes to receive something for nothing.

Adding a new dimension to processes

Through supplementing (NOT replacing) processes with game elements, brands can enhance the value of an action by adding excitement and fun to existing touch points. This gives customers a more positive brand experience.

Give customers control

The core of gamification is to bring a customer from one point to another. Exactly the aim of the customer journey. Customers don’t like to feel forced to click, to buy or to engage in any way with brands. Gamification can give customers a greater feeling of control of their own destiny, of being in the driver’s seat whilst still moving towards the next step in the journey. When people feel they’re in control, they also feel more motivated. This motivation also comes from working on something they value (the prospect of reward also adds value to an activity).

Enable customers to set goals and compete with themselves

Being competitive is in our nature, and are almost always keen to try and beat our own score.

Offer a sense of achievement

This is an incredibly powerful driver of human behavior. Even looking at the basic offerings of your brand, if you customer feels they achieved something with you, they’ll very likely come back. If you can create a sense of achievement in a new way, and give repeated possibilities to continue achieving — why wouldn’t you?

Bear in mind — achievement looks different for different people. This could differ depending on who your audience is, so do some digging, and get to know what motivates them.

Offer exclusivity, or at least the feeling of exclusivity.

Think beyond gamification, and you see the powerful effect of exclusivity everywhere. From waiting lists, queues outside clubs, every iPhone release, limited editions, time limited offers among others. There might always be a logistical reason behind these “barriers” to immediately access something, but you can bet they’re almost always strategic. They give the impression the items or experiences are more desirable.

Translating this to gamification — most likely used as a loyalty program feature or for customer relationship building — the fact that the customer needs to first ‘play’ and ‘win’ to reach the reward automatically makes that reward more desirable. It’s an incentive, not a detractor.

Essentially, games play into our basic needs as humans. A desire to achieve and to feel good through validation and entertainment.

These customer benefits also bring the brands themselves a number of business benefits. Utilizing gamification along their customer journey can:

• Drive engagement
• Encourage users to give feedback
• Reinforce good behavior — something the brand can define as either visiting their website or app, updating their accounts or trying new features or products
• Increase loyalty of customers and so increases the retention rate of the brand
• Enables brands to collect more data on customers to draw insights and shape experiences

Does losing detract from these benefits or bring other drawbacks for brands?

Losing is an accepted part of any game. Though there are some misconceptions about gamification.

Gamification is not a magic wand

Games don’t always make the boring things fun — instead they make the fun things more fun. A great quote that sums up the reality of gamification misuse comes from Jay Hanlon, VP of community growth for Stack Overflow:

“the crazy secret about gamification: In the history of the world, gamification has never gotten a single person [to] do anything they didn’t already basically like to do.”

An example. If a bank is having a problem with its customers not keeping on top of the fairly tedious task of logging into their account to check in on their finances everyday, the wrong approach would be to make a game of it with superficial game elements. Meaning, if they were to reward points or badges for each log in, they’re very unlikely to see much of a change in log-in rates.

Now if the customer already exhibits the behavior of visiting the app or website because they like it, gamification could be applied to encourage other behaviors while they’re there. This could be encouragement to try a new feature such as making their first peer-to-peer payment, and encouraging more frequent use through gamified elements. In this situation gamification could dramatically boost engagement.

Consumers want instant gratification, but this doesn’t always mean the prize

When creating a game, brands should make the game itself instantly available. We’ve all experienced waiting time, even a slow loading screen and a little-too-long tutorial when all we want to do is play the game and find out if we won or lost.

Short attention spans and the need for instant gratification can lead brands to believe they must always give customers something for simply giving their time to the game. This is not true. The game is something the customer has already chosen to engage with in order to receive the previous mentioned benefits (fun, excitement, control, achievement etc.).

As long as the game is simple, fun and quick to inform them of results and progress, brands should not feel obliged to reward engagement each and every time. We — consumers — know the rules of games.

Losing can have negative effects, but community engagement moderates this

Naturally, while losing is an accepted risk when entering into any game, no-one likes to lose. Instead of aiming to reward players each time, brands should instead aim to build up and nurture the community surrounding the game.

Research (Leclercq, Hammedi, and Poncin, 2018) highlighted that the negative effects felt in terms of customer engagement as a result of losing a game was moderated if the player has a high level of engagement with the related community. Meaning incorporating and encouraging social elements to any gamification by a brand can only enhance the experience for customers.

Gamification with only extrinsic motivation can have a greater negative effect when players lose

Gamification should combine intrinsic and extrinsic motivations (Hammedi, Thomas & Poncin, 2018).

Extrinsic motivations might include items offered as rewards, whether this is money, items related to the brand or product/service extensions and add ons.

Intrinsic motivations include many of the customer benefits we already touched on, and include the internalized motivators, for example competitiveness, excitement or the sense of achievement.

Purely extrinsic rewards often results in the player’s engagement relying very heavily on the continued provision of these rewards, and in the absence of this engagement levels fall away quickly. So any behavior change brought about by the gamification is short-lived.

Combining extrinsic with intrinsic has been proven to better sustain engagement, even when rewards are less frequent. The player who is also intrinsically motivated experiences the benefits of gamification for longer (Chandler and Chen 2015).

In summary, gamification definitely brings a number of rewards beyond enjoyment for customers, and brings brands business benefits beyond happier customers.

While losing at a gamified brand touch point can negatively impact the customer’s experience, there are measures brands can take to minimize this impact. Losing is part of the game, and if a game is well thought out with the customer’s motivations in mind, brands have nothing to fear.