Successfully creating customer engagement strategies depends on your ability to build two-way communication with your customers and earn their trust and loyalty. Gamification is playing an increasingly important role in creating this communication, trust and loyalty. A whole range of clients from Foursquare and Groupon to Nike agree that the most powerful way to create and engage a vibrant community is with game mechanics.
By leveraging points, levels, badges, challenges, rewards and leader boards these companies are dramatically lowering their customer acquisition costs, increasing engagement and building sustainable, viral communities.
Gabe Zichermann, author and Summit Chair/CEO of Gamification Co, characterises gamification as “the process of using game thinking and game mechanics to engage audiences and solve problems. It’s about taking the best ideas from games, loyalty programs and behavioural economics and using them in new, exciting ways”.
Gamification is not about turning your organisation into a games company or re-directing your marketing activity to ‘gamers’ or the youth market. It is instead about using the mechanics of gaming to help you achieve positive outcomes.
For example, the Swedish National Society for Road Safety and Volkswagen implemented a Speed Camera Lottery in Stockholm. While speed tickets were, as usual, sent to drivers exceeding the speed limit, the ones who obeyed the limit were pooled into a lottery funded by the fines, and a random winner was chosen to receive a cheque containing the lottery winnings. The pilot scheme resulted in a 22% reduction in speed and a survey carried out found that drivers also liked the idea i.e. driving legally can earn you money.
Foldit, a multiplayer game released by the University of Washington, turns scientific problems into games. By folding digital molecules on their computer screens, gamers cracked an Aids related puzzle that had been baffling scientists for over 15 years in just 10 days. Fodit has now built up an active community of over 236,000 members.
The US military has been recruiting candidates through America’s Army, a video-game recruitment tool. Gamers are ranked among friends and can earn ‘distinguished status, badges, medals and ribbons. A 2008 MIT study that found 30 % of all Americans age 16 to 24 had a more positive impression of the Army because of the game and the game had more impact on recruits than all other forms of Army advertising combined.
Gamification is also gaining momentum in the retail industry. The gamification market is currently worth approximately $100 million and is expected to reach nearly $2.8 billion by 2016 according to M2 Research.
A recent Forrester Research report on gamification defined successful engagement as degrees of involvement, interaction, intimacy and influence. Gamification utilises these strategies to enhance communication and action, and in turn, create more compelling and memorable experiences for customers.
According to Forrester, gamification encourages customer engagement in the following ways:
- Involvement: Gamification allows brands to increase participation among customers, leading to increased site returns, new visitors and registrations.
- Interaction: Content becomes more meaningful to customers when they are connected to brands and retailers. Gamification incentivises players to interact with products, leading to the increased likelihood of purchase.
- Intimacy: By tapping gaming strategies, retailers can spark a real-time, intimate connection with customers through fun and rewards, leading to long-lasting and trusted relationships.
- Influence: Incentives such as tokens, badges and offers encourage customers to share games with their peers.
Organisations that embrace the trend have the opportunity to gain loyal customers and find a competitive edge in recruiting, retention, talent development, and business performance. In a business setting, gamification means applying gaming principles to everything from back-office tasks and training, to sales management and career counselling. Gamification can also enhance transparency and compliance. According to Deloitte Insights for CIOs, when aligned with desired behaviours, gamification can help guide awareness and adoption of standard policies and processes, often operating in the background without the user’s conscious effort.
For example, FedEx is using gamification to promote information sharing amongst its 300,000 employees in 220 countries. FedEx is trying to unlock the knowledge of individual employees by creating a social network that motivates them to share rather than keep knowledge close to their chests. Through its adoption of gamification, FedEx is hoping to create a fundamental shift in employee outlook: from equating knowledge-hoarding with power to believing that knowledge sharing is power.
Research by business consulting firm Protiviti has found that customer loyalty is the top non-financial business challenge facing companies in 2012. Many companies could begin to meet this challenge by harnessing the power of gamification and incorporating game mechanics incentives into their engagement programmes for 2012 and beyond.
One company doing this really well is Expedia which has just launched probably the largest gamification project ever achieved in New Zealand and Australia with an online interactive game called, ‘Tag Me If You Can‘.
In the game, Nathan Jolliffe (from the The Amazing Race & Celebrity Apprentice in Australia) travels to 15 secret destinations around the world. Every day he gives short video clues about where he is. Participants are then welcome to sign up and geo-tag his location, to within ten metres, for a chance to win a share of $150,000.
A new game launches every week day and players have 24 hours to tag Joliffe. Each player can drop three tags per day, but can earn more credits by sharing the game with friends on Twitter or Facebook. Each time a tag is dropped the game will tell the user if they are Red Hot, Hot, Warm or Cold to indicate how close they are to the destination. Players can also use Facebook and Twitter to get extra clues.
The campaign aims to increase awareness and interactivity of Expedia’s social media presence and reinforce the brand’s positioning as a travel expert. It is supported by television and online advertising as well as social media, in addition to promotion across Expedia’s Australian and New Zealand sites. ‘Tag Me If You Can’ is a great example of how brands can use gamification to drive business performance and growth.
A version of this article was published on www.sitecore.net