Gamification: Beyond The Hype

The author speaks to the "treasure box" many people keep - which contain mementos from their life, going back to their early childhood. Most of the contents are items of very little cash value, but significant sentimental value.

He looks into his own treasure box and speaks of a pin he earned working at a ski resort. The resort offered pins for skilling a certain number of vertical feet in a day - bronze, silver, gold, and platinum (not real precious metals, just tinted aluminum),. The platinum pin was for skiing 50,000 vertical feet in a single day, which was such an arduous task that less than fifty had ever been awarded. On a day off, he and a few others challenged each other, and re recounts how arduous it was. The badge, which he keeps to this day, represents his memory of that event.

He knows this is not particularly unique or unusual: most people have such a treasure box filled with badges, pins, ribbons, trophies, and other tokens of achievement. There's nothing new about motivating people with such things. Boy and Girl Scouts have been handing out badges for over a century, and military organizations have been awarding medals for thousands of years.

Such emblems are common to everyone: they remind a person of their accomplishments, bolster their self-esteem, and reassure them of their capabilities. These "trinkets and trash" are among our most prized possessions not because of what they are worth, but what they represent.

(EN: A significant observation here is that the "treasure box" most people keep is something private. Some awards are placed on the mantle for public display, but many are kept in a box in the closet or a trunk in the attic. I expect the author will eventually meditate on that, but it's worth noting that, right from the start, achievement is a personal matter in many instances - which is contrary to the desires or expectations of those who seek to use gamification as a stimulus for peer-to-peer marketing.)

Gamification is much more than trinkets for leisure activities, and is being used to motivate human behavior in many walks of life. It has become of great interest to commercial organizations, which wish to motivate purchasing and loyalty behavior. But it is very often gotten wrong. In this book, the author intends to explore the topic of gamification, and help guide the reader to getting it right.

Digitization Drives Scale

The tokens of achievement are a recognition of that which has been achieved. In the days before computers, that meant assigning a human being to observe and record activities. For his skiing pin, two employees were engaged all day long in sitting at the top and bottom of the run, checking off each time a contestant visited their station, and the paper records were reconciled to validate qualification for the awards.

In the present day, the task of observation and recording are automated by computer technology, making it easy to recognize and grant achievements for activities. Unfortunately, it makes it too easy. "Virtual" badges and awards are popping up everywhere, granting people "recognition" for activities that are quite ordinary, and handing them out by the thousands.

Remember: what made that skiing pin valuable to the author was that it required him to perform a significant feat to earn it (skiing over 50,000 vertical feet in a day was arduous) and the recognition was rare (less than 50 were ever awarded). Do you think he would be motivated to earn a pin for strapping on his skis? Do you think he would cherish it if everyone who visited the resort got a pin just for turning up?

And this is a common problem for commercial organizations that wish to leverage gamification: they want everyone to purchase more and be loyal, and hand our tokens of recognition for actions that require little effort and are so common that they are not distinctive. Instead of using the power of gamification, these practices are robbing gamification of its power.

(EN: This is an excellent point - but should be extended to consider the tragedy of the commons. Not only does each firm who handles gamification badly damage its own rewards system, but their collective action damages all reward systems and robs "badges" on any esteem. The general reaction to "I earned a badge" used to be admiration by default - and has now become "so what?" because badges are too common and represent nothing of importance.)

Same Contents, Different Label

The author mentions that he is an analyst in information technology - not a gamer, a marketer, a psychologist, or a game designer. His work involves looking at transactions to identify trends in behavior and group people into categories for marketing purposes, largely as a means to predict future sales and estimate the potential impact of changes.

"Gamification" falls into his domain, and it has done so for years. The simple act of selling a product offers a customer a reward (the benefit of ownership) in exchange for a behavior (the effort and expense of purchasing it). Companies augmenting their sales by offering their customers a little something extra for purchasing is also nothing new. Frequent flier programs, credit card points, special treatment for big spenders, and the like have all been in practice for decades or centuries.

As such, "gamification" is a fresh label on an old product. The same stuff is inside, but the sexiness of a new label gives rise to consultants who are selling it as something new, pretending they possess knowledge that others don't, and swindling a great many clients. Worse still, the new label enables them to ignore good practices and substitute ones that have failed miserably in the past. There are a great many terrible things being done under the banner of "gamification."

With this in mind, another major focus of this book is in defusing the hype and wild claims and to preserve the knowledge and experience of centuries that is being too hastily cast aside. There is a great deal of good in gamification, but the charlatans and snake-oil salesmen are working diligently to poison the well. But on the bright side, the new label does give us an excuse to gather together these existing practices, and to learn from the past as we look to the future.

Early Gamification

The author speaks a bit about history: engagement tactics such as rewarding customers for frequent purchases is nothing new. The S&H "green stamps" program that rewarded customers for shopping at different merchants began in 1896 - but well before that any merchant would recognize their best customers, whether by frequency of visit or purchase sizes, and would give them special treatment.

The difference today is that computers give retailers the ability to track and reward behavior with greater ease and accuracy. Reward card programs, for example, provide the customer with a card that is swiped at the register to record their purchases and give them immediate discounts and other special treatment. This leverages the power of databases and computerized point-of-sale systems. It could have been done with ink and paper, but the process of collecting and checking the data with each purchase would have been laborious and tedious.

Mobile technology goes a step further. Burke considers Foursquare, which enables customers to use their own smart phones to "check in" at locations - while this does not track purchasing information, it tracks visits, and this can be powerful information for vendors.

People who use Foursquare also earn rewards and badges - a "mayorship" for being the most frequent visitor to a place, or the "gym rat" badge for checking into a gym ten times in thirty days. These digital rewards are typically worth nothing at all, but people compete with others to be the Foursquare Mayor of their favorite hang-out, and will visit the gym more often to maintain and upgrade their badge.

Naturally, too much is made of such things - Foursquare is dreadfully overhyped and has not delivered the specific benefits that enthusiasts have claimed it would. Businesses wasted millions on Foursquare programs that were abandoned because they failed to deliver results (EN: though in some instances it was a badly designed or poorly executed program that was to blame, it is likely most often just a bad idea in the first place.)

Burke reiterates the need to stand aloof from the hype, and the need to "inject a little reality into the conversation" so that the genuine value of gamification can be leveraged, expectations can be realistic, and strategies can be based on sound theory that will bear out in practice.

Gamification Defined

The term "gamification" was actually coned in 2002 by Nick Pelling, who used it to describe a practice in software development. Observing that many computer users played online games, Pelling reckoned that borrowing upon the convention of gaming would make software easier to learn and use.

Unfortunately, this was completely missed and misunderstood, and others took the word to imply that game-like conventions could be leveraged not only to make things usable, but to make dreary tasks fun. Aside of being a complete misunderstanding of gamification, it muddied the term completely, and it has become a buzzword with little meaning.

Burke attempts to brush off some of the buck, with a definition his firm is using: Gamification is the use of game mechanics and experience design to engage and motivate people to achieve their goals in digital media.

Compare any plan of action to those five core qualities, and you can quickly sort out whether it is gamification or gimmickry.

Beyond the Hype

Burke believes gamification to have "tremendous potential" but that most companies that have experimented with it are not getting it right. Many of them have been completely bamboozled by the hype into having unrealistic expectations and engaging in poorly considered programs under the banner of "gamification." Many of them "have mistaken people for puppets" and their contempt for their customers is completely evident in their efforts. They are doomed to fail.

He mentions that Gartner Research examined many gamification efforts and, in 2014, pronounced that 80% of them will fail to meet business objectives due to poor design, and even stand to alienate existing loyal customers. Clearly, the efforts of these bleeding-edge practitioners are desperate and misguided in their greed to cash in on a trend they do not understand.

He also mentions Gartner's "Hype Cycle" which has tracked over 1900 new technologies and trends in various efforts, and has identified a predictable pattern which begins with a "peak of inflated expectations" and heads sharply into a "trough of disillusionment." This is based on the behavior of companies, which is often stirred up by the industry press.

He mentions some of the ideas expressed by clients who have hired his firm to help them with their failing gamification efforts:

The problem in such instances is not that the gamification program is not being executed well - but that the goals for which the program was designed are inherently flawed and that gamification is not the right solution to achieve them (if they are achievable at all).

In a broad sense, gamification is "on a collision course with reality" and in some instances the damage has already been done. So yet another goal of this book is to educate those who are attracted to the fad so that they are right-minded about the practice of gamification - and perhaps even to prevent the failure of bad gamification efforts from putting a stink on the practice altogether.

Achieving Gamification Success

An important point: when gamification succeeds, it is because it has motivated people to achieve their goals. It is not about having fun or winning prizes, but about encouraging people in the right direction to achieve the goals they already have.

Additional emphasis should be placed on whose goals gamification is meant to serve: the goals of the player, not the game designer. That is to say, the goals of the customer, not the vendor.

Companies wish to make money, and make as much of it as they can. But their profits are only earned when the product or service they provide to a customer is worth the money the customer gives in exchange for it. No game or gimmick will distract customers for long: they will eventually recognize if they have been hoodwinked into purchasing something inferior or useless to them - and will be all the more irate at the deception.

However, it can be noted that most companies are not swindlers, and have something of genuine value to offer their customers. Most are satisfied with the profits they make, which can be quite substantial, in selling their products and services to customers who genuinely need them. For such firms, gamification is not a trick, but an enhancement that makes the buying process less arduous.

Early Adopters

In most organizations, gamification started in the marketing department and spread from there. Currently, the fastest-growing area of the gamification market is in employee-facing solutions. It is also noted that most firms are attempting to utilize private stand-alone solutions rather than leveraging the ones that already exist and are in public use.

The departments/functions that are most attracted to gamification are marketing, customer loyalty, human resources, sales, product development, customer services, and innovation management. All are attempting to use something akin to gamification to engage people to help achieve business objectives.

Within information technology departments, gamification has been embraced for a few basic reasons. Primarily, gamification creates demand for the services they provide the organization - so the IT department gets large allocations of budget and exercises great power in these initiatives. Secondly, it gives them the opportunity to do what they do well: deal with data. Gamification efforts require the collection, storage, and analysis of huge amounts of information, which is the traditional role of IT organizations. Third, gamification elements are often built into solutions. When the IT department purchases a point-of-sale system, it often contains features that would conveniently support a rewards program, and all they need to do to implement one is to set the right switches in the installation process.

The problem with putting IT in the driver's seat is, as usual, that it is the tail wagging the dog. Technology workers with little knowledge of business are determining the metrics by which business will be operated, managed, and directed. Technology workers tend to be fascinated with the sophistication of solutions and blind to their purposes. Technology workers aren't the most well-socialized individuals and are often well out of touch with what really motivates consumer and employee behavior. Simply stated, they are good at building systems, but very poor at deciding what the goals of the system ought to be and often obsess with the technology to the detriment of the business objectives of the organization.

With this in mind, it is especially important to be well-armed against bad ideas. A program manager who is approached by a consultant, even an internal consultant from his own IT department, should know what to look for and what questions to ask to identify whether a proposed "gamification" solution will benefit or harm their business. Again, this book will help.

How The Book Is Organized

The purpose of this book is to get beyond the hype and explore the realistic potential for leveraging gamification. When applied effectively, gamification presents a tremendous opportunity and can drive business results. When applied poorly, it represents a tremendous opportunity to lose business and damage your brand.

The first five chapters to this book introduce the concepts of gamification, describe how it can be used, and identifies where it is inappropriate and harmful.

The last five chapters are about designing and launching a gamification solution, which follows a seven-step process:

  1. Business outcomes and success metrics
  2. Target audience
  3. Player goals
  4. Engagement model
  5. Play space and journey
  6. Game economy
  7. Test and Iterate

The intended audience of this book are people who are interested in leveraging gamification, particularly those who are studying the topic prior to launching an initiative, but also those whose initiatives seem to be foundering - that they might rectify their programs or, in a worst-case scenario, scrap them and start over.

Getting gamification wrong can be costly, and it is important to get a firm handle on what it is before making serious mistakes. And that is the purpose and value of this book.