If you're looking for a quick explanation of what "gamification" is, consider it the crack cocaine of social media – in a good and bad way.
In recent years, gamification has popped up everywhere, becoming a vital tool for everyone from FourSquare to Barack Obama. The term refers to a strategy whereby interactions with a brand are made more appealing and addictive to consumers by incorporating tricks from the gaming world, such as high-score tables and achievement badges. Are such "achievements" almost completely worthless in the real world? Yes. Do consumers become mindlessly addicted to them anyway? Yes.
Gamification began, not surprisingly, with video games. Even in the days of Pac-Man, players kept coming back to try to get on the high-score list. More recently, video game developers found that some hard-core users wanted to do more than just play; they wanted to do everything humanly possible within the game. So the developers started handing out virtual badges for all manner of task completions, ranging from the mundane (insert game disc in machine, unlock a badge) to the infuriatingly difficult (bludgeon 100 pedestrians with a baseball bat, unlock a badge).
The trick worked – instead of ditching a game after a single run-through, players were suddenly spending hundreds of hours unlocking various achievements. In terms of brand stickiness, gamification was a home run.
It wasn't long before a host of brands started using the same strategy. During President Obama's election campaign, his team set up a virtual high-score list for those "players" who had raised the most money, pushing volunteers to compete harder for dollars. FourSquare, the location-based social network, has seen a surge in usage since it began rewarding its users with achievement badges for just about everything they do. Gamification has been so successful that everyone from carmakers to clothing retailers is looking at building their own game-like features, or even mini-games. Thinking about buying a sports car? Why not race a virtual one on the carmaker's website first?
But when gamification goes wrong, it can go horribly wrong. No consumer wants to end up on the "Big Spender" high-score list at their local car repair shop, or unlock the "Frequent Clogger" badge on their plumber's website. Even wildly successful companies such as Zynga, creator of the extremely popular Farmville, have experienced a sort of mini-backlash, as some users come to realize just how much time they're wasting collecting digital achievements of dubious real-world value. So, the No. 1 tip for businesses looking to gamify their brands is this: If your business isn't something consumers turn to for fun, don't force it on them.
Gabe Zichermann, chair of the gamification summit in New York and the author of Gamification by Design, offers three simple tips for businesses looking to integrate concepts of gamification into what they do:
1. Understand that gamification is about taking concepts from gaming and using them to better engage your customers; it's not about building games. "It doesn't mean you stop running your company and make Angry Birds," says Zichermann.
2. Think of gamification as a way of creating an Aeroplan-like loyalty program at a tiny fraction of the cost. Many businesses implement loyalty programs such as "get the 10th coffee free" cards. But Zichermann says free stuff is actually at the bottom of the list of what customers want. He uses the acronym SAPS: status, access, power, stuff. Those are the things loyal customers want, in that order. As such, lunch with the owner or a 15-minute head start on a sale for your best customers might be far more effective than a free coffee.
3. Figure out where your product fits into your customers' lives and help make that experience more meaningful. A good example is Nike Plus, an online community for people looking to meet their fitness goals. When a Nike Plus user reaches a certain goal, the voice of Lance Armstrong comes through on their iPod headphones, letting them know they've done a good job. It's a cheap thing to implement, but users love it.
This article originally appeared in the October issue of Report on Small Business magazine.