Psychology at play: SmallWorlds' Mitch Olson on the role of gamification in marketing

  • Digital
  • May 24, 2012
  • StopPress Team
Psychology at play: SmallWorlds' Mitch Olson on the role of gamification in marketing

Mitch Olson is founder of game design studio, Gamedojo, which, in partnership with NZ Marketing and our sister title Idealog, is hosting the Gamification Lab in Auckland next month. He is also co-founder of the hugely successful social game world SmallWorlds and knows how to go beyond buzzwords and hype to create a business case for gamification for your brand.

Mitch OlsonMitch, how would you define gamification?

Gamification is where you take game mechanics, the tools that we use to make video games so entertaining and addictive, and apply them to something that is not a game. Marketing, customer loyalty, online brand communities are all common applications.

It’s human nature to gravitate toward activities that are fun and personally rewarding. Bottom line? Gamification makes interacting with your brand fun, engaging and rewarding; providing you with greater participation, sharing and ultimately increased revenue.

Where did the buzzword come from?

Basically, it arose out of seeing the success that the entertainment games industry had in reaching new audiences. Facebook games like Farmville regularly pull in 20 to 30 million players each month, and successfully attract older and female audiences. The games industry is now bigger than the music recording industry and Hollywood box office combined. The high profile success of smartphone and social media games has led smart marketers to ask how they could get some of that action.

We have had over seven million people in SmallWorlds playing our game since we launched, who voluntarily choose to spend hours with our game every week. When was the last time you could say that of an ad campaign?

One key insight of gamification is that customers do respond to fun and rewarding experiences. What may surprise you is exactly what people consider ‘rewarding’ – it could be self-expression, collecting, creating order as much as competing for points.

There’s no doubt that gamification is an established buzzword internationally – has it taken off in NZ?

There’s certainly lots of interest in it locally. Many brands have told us that they’ve conducted what they view as nice experiments, but feel unsure about how to take the next steps. An often seen yet simplistic implementation of gamification tends to be to just adding points and badges to an app or online community. FourSquare has a lot to answer for!

Things like loyalty programmes are basic gamification systems and have been around for a long time. However, they only appeal to one or two human motivations – getting a good deal or bonus goods. Not everyone is into that. If you could add further emotional appeals, you can increase participation even further.

There’s also been some nice ‘advergames’… playing a game in order to win prizes in a competition is a fun motivator. There are some world-class game designers in New Zealand who could make professional quality games for advertisers.

Unfortunately the stock standard tactic is a ‘bigger banner ad’, which might be interactive, but only create 30 seconds of engagement. If someone doesn’t engage in a game for at least 3-5 minutes then I consider that a failure.

But more is possible than just an advergame. You can use gamification lessons to improve an online community or drive consumer engagement with a brand in the bigger sense.

What are barriers to its adoption?

Gamification got its name from the success of video games but ironically as soon as you say “game” in a board meeting, people get nervous. What we’re really talking about here is behavioural psychology and customer engagement. The result is measurable increases in conversion rates all along the ‘customer funnel’.

The advantage of gamification is that it’s not necessarily about investing in a stand-alone game. It’s key question might be “how could we improve this app, website, sales campaign, online or brand community?”

These are all projects you already have underway – gamification is a fundamental process based on human psychology and motivators to deliver exciting answers to this question.

Is measurement an important part of it?

Oh, absolutely. Metrics are a huge part of gaming’s success, and in fact it’s how we’ve been able to learn what works. For instance, SmallWorlds has over seven million user accounts. With that level of data you can see what kind of challenge different people respond to, or how improving the user interface affects repeat visits.

You’d be amazed at the level of detail we can go to. Even the placement of a particular button on the UI is rigorously A/B tested to see the outcome; not just on immediate engagement or revenue, but also on customer retention at three days, seven days, 21 days later. You get some pretty amazing insights into people’s motivators when you look at them this closely.

What’s next for gamification in this country?

We’re pretty excited about the upcoming Gamification Lab next month; it’s the first in New Zealand.

It’s intended to be a hands-on deep dive into gamification for marketers. We’ll bring together some of the world’s finest examples, together with some incredible insight and learning about the principles involved. You can bring your own campaign or brand along and we’ll workshop it during the Lab.

It’s split over two Tuesday mornings, so you have time to digest the principles and return the following week to get into specifics. At the end you’ll walk out with a business case you can take back to management, as well as a broad understanding of how to engage your customers using these incredibly powerful methods.

We’ll share lessons from game designers and from other gamification projects as well as some of the secrets that have led us to the success we’re enjoying in the gaming world.

Who should be coming to the lab?

If you’re a senior brand manager, marketing director or an agency that is serious about driving meaningful engagement with your brand, you need to know how gamification can deliver.

Why this approach?

One challenge is that people often talk about gamification in very abstract terms. Most people agree it makes sense, but don’t know where to start. But there is another group of people right under our noses – video game designers – who actually have lots of experience in this area, and have large online audiences that they measure the results on. That’s what we plan to share in the Lab. Splitting it over two Tuesdays gives you time to assimilate, and we hope you’ll come back the next week with your hard questions – which will serve to increase the value for everyone attending.

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