How Gamification Will Help Business Growth

The term gamification has become a popular buzzword over the last few years. Nowadays, it is a hot topic for discussions among marketers, entrepreneurs and HR managers. And very often we can observe a collission between groups of people who fancy gamification practices and those who deflect them with disdain.

Despite the large number of opponents and advocates of gamification, it has been actively and successfully implemented in a variety of industries for more than a decade. Each of us even encounters it on a daily basis. Traffic lights with a sound that signals pedestrians to speed up their pace of walking before the light turns red is the simplest form of gamification. Another common and well-known example of the use of gamification is customer loyalty programs implemented by most stores and shopping centres. For each purchase, customers receive points that can be redeemed for products, discounts or special offers.

When people hear the word “gamification” for the first time, they associate the term with “games”. It is true that gamification has a lot to do with games, however, the term itself has a more profound meaning:

It implies the application of game mechanics to non-game activities, processes and experiences.

As Toby Beresford, CEO of the gamification platform Leaderboarded, describes it:

“Gamification is using game mechanics – the underlying nuts and bolts of what makes a game interesting and sticky – to drive behavior.”

Game mechanics include points, achievement badges, virtual currency, progress bars, contests, rankings, leaderboards and  levels. By incorporating game mechanics into non-game activities, we can trigger a particular behaviour that leads to achievement of the desired outcome. If we go back to customer loyalty programs for example, we will notice that stores use points to make customers purchase more items and keep them coming back again and again. Points serve as stimuli that urge customers to make repeat purchases while stores receive the desired outcome, i.e. increased profits and loyal customers.

Game mechanics have also been actively used in a variety of fitness apps. For instance, when the runner finishes running the distance of 2 km (level 1), the app switches to level 2 where the runner has to run 4 km. In this case, runners are motivated to move on in order to go up to another level. Moreover, apps include social elements that allow users to share their achievements with their friends on social media. Such approaches enable users to get public recognition for their achievements and motivate them to stay active and use the app more.

Most businesses, regardless of their size, implement gamification in key areas like HR management, marketing and innovation management. Some companies successfully apply gamification in their recruting process. Gamification simplifies it and helps employees to figure out whether they are the right fit for a certain position. By playing specially designed games in a simulated environment, potential employees are able to learn the basics about the company’s culture, job requirements and future responsibilities.

To increase the performance of their employees companies often implement employee reward programs. Since all humans possess an innate need to be recognized and appreciated, such programs are a great incentive to stimulate the desire of the employees to achieve more and perform better. Nonetheless, it is important to bear in mind that quick and small rewards or recognitions are much more effective, because they keep employees motivated and focused. Some companies also prefer to display employee performance results on leaderboards. This triggers healthy competition among team members and allows to track progress in employee performance.

Many companies gamify marketing strategies to boost customer engagement and loyalty, increase brand awareness and consequently generate greater profits. For instance, companies reward customers with points or badges for getting engaged with the community, reviewing products, creating buzz in both social media and offline spaces. The most active users receive VIP user status that enables them to get access to sneak product previews and special offers. Thus, users get stimulated to active participation and engagement with the brand.
Companies reap rewards not only in terms of increased customer loyalty. Submitted reviews can be regarded as a great source of innovative ideas. And it is not a secret, that companies that listen to their customers and leverage the power of their feedback have all chances to win. And it doesn’t matter whether reviews are positive or negative. Bill Gates says it right, “Your most unhappy customers are your greatest source of learning”. When listening to customers, companies gain deep insights into how to improve their products and services. The use of gamification makes customers more enthusiastic about submitting reviews, providing feedback and engagement with a brand or company. Moreover, happy customers are more likely to become brand ambassadors within their communities. Word of mouth is one of the most effective forms of marketing as people are more influenced by the opinion of their peers than faces from ads when it comes to choosing products or making a purchase.

Gamification turns out to be a valuable driving force of innovation. By engaging their target audience and utilizing intelligence of the crowd, businesses are able to innovate and increase growth. Furthermore, gamification breeds a collaborative spirit within a company. When people are recognized for their contribution and feel that they are part of a great culture they tend to be more open when it comes to sharing ideas and participating in brainstorming sessions together with other members of the team.

Nowadays, people crave for more reward, recognition and engagement from experiences than ever before. When gamification is implemented effectively, things turn out to be engaging enough to keep customers and employees focused on them for a long period of time. Using game mechanics correctly has proven to be successful in means to engage people, motivate them to change behavior in order to solve problems effectively and have a positive impact on business growth and profitability.

 

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