The new fall TV season marks a happy resurrection: The Pyramid, the most recent update of the 20th-Century classic game show The $10,000 [$25,000] [$100,000] Pyramid, this version from Who Wants To Be A Millionaire? creator Michael Davies and friends. It’s a super fun revamp that will more than likely be a nice lift for the Game Show Network, which will start airing The Pyramid on Sept. 3 at 6 p.m. EST. But successful or not, this update of a tried-and-true idea offers a sidelong lesson about a next big entry in businessspeak: “gamification.”There is nothing new under the sun, they say, and so it is with gamification. The term, which has been around for a few years, refers to any number of ways in which businesses try to engage customers and/or employees using the core principles of, well, games. These are defined, according to a recent white paper, as “fun, play, transparency, design and challenge.” As with Pyramid, this is not exactly a new idea: From World’s Finest Chocolate to S&H Green Stamps, companies and organizations have been using such principles to lure and motivate adults and kids, as any Scout worth his or her merit badges can tell you. Heck, higher education is nothing if not the gamification of learning, where the buying and selling of knowledge is made more engaging by dorm living, class ranking, badges masquerading as diplomas and status levels—a.k.a. higher degrees—you can hang on your wall or at the end of your name. Still, the most recent iteration of gamification is a strong contender for top-5 placement in next year’s list of business cliches. Or at least the next version of Business Buzzword Bingo! Here are six reasons why:
1. Consultants are on the case. Almost as important as a memorable or catchy name is—”gamification” falls somewhere between “Six Sigma” and “crowdsourcing,” if you ask us—any business concept worth its salt needs evangelizers. That’s no problem in this case. The aforementioned white paper was authored by Doug Plamer, Steve Lunceford and Aaron Patton of Deloitte, one of the larger consultancies to hop aboard the gamification bandwagon. It’s worth reading if you’re interested in the subject, but either way one line from the report stands out especially as a sign of gamification’s coming ubiquity: “It’s a trend that analysts claim will be in 25% of redesigned business processes by 2015, will grow to more than a $2.8 billion business by 2016, and will have 70% of Global 2000 businesses managing at least one gamified application or system by 2014.” No wonder so many startups (including Badgeville, Bunchball and Seriosity) have formed in recent years with the aim of helping other companies gamify their customer interfaces, employee training processes and more.
2. Gamification exploits some very basic instincts. Essentially, gamification is any kind of engagement that melds competition, reward, easy-to-track progress and an enjoyable user experience. In other words: FarmVille! Okay, maybe not FarmVille exactly. But the very qualities that have turned video and casual gaming into multi-billion-dollar businesses are the core of the movement to gamify life: All things being equal, humans like to interact with other humans, challenge themselves while they’re at it and receive some type of reward along the way. Frequent flyer programs, if you think about it, are an old-school example of business exploiting these tendencies, albeit with limits. For all the popularity of these and other reward programs, it’s not especially easy to share accomplishments or status levels with others, and not many consumers go out of their way to do so. On the other hand, before Facebook or Twitter people generally didn’t go out of their way to brag about how many friends or acolytes they had. But now most of us do just that very thing without really even trying, which leads us to …
3. Technology makes all things easier, especially competition. Whether you’re trying to engage customers or employees—especially those from demographic cohorts adapted to video and casual gaming—there are few better ways to go about that task than allowing them to compete with their peers. And that’s a lot easier to do when you can provide real-time data and awesome graphics to show consumers or workers how they’re faring relative to friends, colleagues or others. Utilities are at the forefront of this trend, using any number of platforms and games to encourage customers to conserve energy, and rewarding them with actual prizes if they do. Likewise healthcare and insurance companies, as a way to help people take better care of themselves; and restaurants, as a way to both improve customer service and increase sales.
4. Boredom! If you’ve ever spent time on Hulu watching classic detective series from the 1970s—The Rockford Files comes to mind—it’s hard not to notice the difference in pacing between those shows and their modern-day equivalents. Few people would accept such slow action in their current TV fare. Likewise, today’s consumer and employees are increasingly inured to fast-paced, competitive interactions in all aspects of their lives. It’s only natural that they would connect to UXs and UIs that offer similar feedback loops.
5. Money isn’t everything. As successful as some conventional rewards programs have become, there’s a growing body of research to suggest that people are not nearly as motivated by monetary rewards (or their equivalents) as free marketeers and uber-capitalists would have us believe. That’s especially true at work, where so many other factors determine satisfaction and success. By engaging workers through purposeful games—as a way, for example, to improve always-dreaded training modules—firms are able to kill two birds with one app: increasing employee “learnings” while making work just generally more enjoyable.
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6. Fantasy football! One would be hard-pressed to imagine a better strategy to engage serious and casual consumers than fantasy sports, which are essentially the gamification of sports fandom. (And no longer even limited to sports.) What started out as a friendly MLB-centered game among a dozen or so New York media types three decades ago has exploded into a multi-sport, multi-billion-dollar business. And why not? Fantasy sports perfectly captures the basic principles of gamification: “fun, play, transparency, design and challenge,” not to mention “competition, reward, easy-to-track progress and an enjoyable user experience.” Ironically, the sports leagues themselves were slow to understand the vast potential of fantasy, which not only generates huge revenues for media companies like Yahoo! and ESPN but also deepens fan loyalties (albeit to player and leagues, rather than teams). This lesson has not been lost on others. Especially in regards to consumers, no company wants to miss out on the chance to gamify—and monetize—wherever they can. Because when gamification works, it often works spectacularly.