Gamification is more than just playing games. It is the application of incentives, reward systems and engagement similar to that found in video games to anything from entertainment-based mobile applications to internal business processes.
Throughout the next few months we will be exploring the topic in further depth, and we welcome you to come share in our learnings.
Game on!
Although Gamification is quite new as a stand-along concept, the approach has been implemented a long time ago. According to the professor Kevin Werbach (Wharton, University of Pennsylvania - the first official lecturer on this subject) gamification is mainly listening to what games can teach us, learning from game design and appreciating fun. So, Gamification as a concept can be implemented in many areas:
externally (e.g. in Marketing, Sales),
internally (e.g. HR, Productivity enhancement), and
for behavioral change (Sustainability, Health and wellness, etc.).
Sweden is rich for examples of the last approach - changing the behavior in a social context. One example is 'Speed limiting'. In order to stimulate drivers to keep the speed within the limits, Stockholm's Police went beyond the fines. On one of the speed limit radars they installed a lottery sign, explaining the rules. Part of the fines, collected from those who exceed the speed limit, will be randomly given to a driver who kept the speed within the limits. The results were astonishing - the average speed was reduced from 32 km/h to 25 km/h. Which is a 22% reduction rate.
Another example is 'Piano stairs'. The objective was to stimulate people to use the stairs vs. the escalator. The Odenplan metro station, (in Stockholm) had its stairs turned into a piano. So, stepping on the stair would make a piano key sound. As a result, 66% more people chose stairs over the escalator.
So, Gamification can be used in many different cases, even in changing behavior. But also in Marketing. Coke Zero had presented this amazing marketing campaign for the new Bond movie, Skyfall . The objective of the video was to stimulate the discussion and engagement around the central campaign idea of ‘Coke Zero drives you to unlock the 007 in you’(1) . The buzz generated by the campaign has reached 7M views on Youtube and gained one of the highest sharing rates on-line as well as high coverage in off-line media. So, objective was achieved by far.
Although this last example is not 100% Gamfication in action, it illustrates great potential in applying the concept in engaging with consumers. So, be ready for more games in real life!
In order to become a promising investment, start-ups need to combine a great team, good idea and sound business plan amongst other necessary requirements. So what do venture capital firms think about the integration of gamification into start-up product concepts and business models? The Wall Street Journal took advantage of the SXSW Conference last year to interview several top tier VC firms to get their perspective on the trend:
MAHA IBRAHIM, GENERAL PARTNER AT CANAAN
PARTNERS (Bio) Is gamification an industry? We see gamification as an emerging trend that will be used by many different industries. In a similar way that data transformed advertising and entertainment, gamification has the potential to transform industries such as e-commerce, education, health care and finance. The data services industry developed along with companies such as Omniture, and there will be an industry developed around gamification. There will also be companies that tightly couple their business model with gamification to build large businesses in their respective industries as Google and Facebook have used data in the advertising industry. Is gamification as big as social media, mobile apps or the cloud? The potential for gamification is quite large. Since it can be used by many different industries, its potential is far-reaching like social, mobile and cloud. With our investment in Kabam, which designs highly immersive social games, we have seen a growing acceptance of consumers to engage with game dynamics. Social and mobile games will continue to increase consumer adoption and fuel gamification in an online world where any product or service can easily incorporate game dynamics. How big gamification ultimately will be is dependent upon innovative companies to unlock this potential, like Facebook, Apple and Amazon have.
What is gamification? Making the impersonal personal. Gamification is all about making people care. Is it a standalone industry? No. It is an approach to solving a problem. The best classic example is the “Member Since” feature on AmEx cards. The only person that knows or cares about this is the cardholder, and they care very much about it. It stops you from canceling your card, and it makes you proud. You could call that silly, but it works in a statistically significant number of cases. Gamification today is much more sophisticated and responsive, but the core principles that make it effective remain the same. Is it as big as social media, mobile apps or the cloud? No, but technology is allowing us to easily add gamification to many products and services.
What is gamification? Gamification is a simple tool to incentivize users to behave according to the rules and needs of the business through rewards and competition. Is it a standalone industry? Absolutely not. It is a tool. That’s not to say isn’t important. I think gamification is the single most important tool that has allowed the growth of online business. At its base it builds on our desire for recognition and reputation. The reason that eBay has a 2% default rate is we are incentivized to maintain our star rating/reputation. One other thing that is interesting about gamification is that not only does it incentivize users but it keeps the company honest too. Once a business establishes the rules of the game, it has to stick to them.
What is gamification? Using game theory and dynamics to encourage engagement. Is it a standalone industry? No. To us, it is a tactic that can be applied to many different industries.
JACOB MULLINS, SENIOR ASSOCIATE AT
SHASTA VENTURES(Bio)
What is gamification? “Productization” of the human spirit to compete and win. Is it a standalone industry? No. Gamification is an important component that can add tremendous value to a broad range of products from sales-focused products to social gaming products, and many more. But is the gamification space able to support many economically viable companies specifically focused on gamifying other products, create thousands of jobs and hundreds of millions of dollars in revenue? No.
JAY LEVY, CO-FOUNDER AND PARTNER AT
ZELKOVA VENTURES (Bio)
Is gamification a standalone industry? There will be and are firms (both product and service) that will grow to help other companies better integrate gamification into their products. While I think they can grow to nice businesses I’m not sure it will grow out of a niche industry. Is it as big as social media, mobile apps or the cloud? No it is not, these are tools that plug in to other products to make them better. I don’t see them being standalone products at any point–that industry already exists, gaming. Interviews from the article "With SXSW Buzzing About Gamification, Venture Investors Weigh In"
