‘Gamification’: A Growing Business to Invigorate Stale Websites
It’s a neat trick—if it lasts. “People move in herd mentality,” says Tim Chang, partner at venture capital firm Norwest Ventures. “The backlash is going to come from people who try to slap [game features on a site] without any understanding of how to bake it into the full experience.”
A new breed of consultants, working for the likes of NBC and Playboy, promises to boost business by adding game elements to humdrum sites
Rajat Paharia is a new breed of business consultant. For a monthly fee he promises to invigorate stale websites by turning them into video games. Visitors become players. If they perform certain tasks, such as commenting on articles or e-mailing links to friends, they earn points or badges. Paharia’s company, San Jose-based startup Bunchball, has performed more than 50 online makeovers for NBC (GE), Playboy, and other large websites. “Our customers don’t want to be game designers,” says Paharia, 40. “They just want more page views.”
The business of engendering online loyalty through gaming techniques is fast becoming as significant as the real-world loyalty industry, which builds rewards programs for airlines, hotels, and credit cards. The difference is that real rewards, like free hotel rooms and airfare, cost businesses real money. Badges and leader boards, excluding fees to consultants like Paharia, cost next to nothing.
The techniques behind gamification are known in the business as “game mechanics,” and they’re everywhere. Countdown clocks on Gilt Groupe, a discount luxury goods site, impel shoppers to nab deals before time runs out. Colorful virtual badges, such as those on Foursquare, a smartphone app that lets people “check in” to venues, reward frequent use of a site or service. When LinkedIn members log in they’re shown a progress bar, subtly urging them to add more details to their profiles.
The practice of gamification is rubbing off on the real-world loyalty industry, too. Barry Kirk, director of strategic consulting for Maritz, manages loyalty programs for Bank of America (BAC), Capital One (COF), and other brands. One of his clients, Hilton’s Embassy Suites brand, has been piloting an online game designed to encourage existing customers to try out new hotels. “Game designers have created these amazingly compelling strategies,” says Kirk. “Why wouldn’t we adopt those approaches?”
The bottom line: “Gamification,” a trendy technique for building addictive Web destinations, has raised the number of return visitors at some sites by 20 percent.