The Business Value of Gamification

Rajat Paharia runs the gamification company Bunchball. Download their “Gamification 101” if you want to learn more about gamification.

If you’re running a website, an online business, or a mobile application, you have three legs of a stool that are driving business value for you.

The first leg is Traffic Optimization. This is everything from SEO to SEM to Facebook Ads to traditional media buys. It’s about how you’re attracting users.

The second leg is Content Optimization. This is your content mix, the community on your site, A/B testing, etc. It’s about how you satisfy and retain users.

The third leg of the stool, the one that a majority of business owners have been missing to date, is User Optimization. Directly influencing user behavior, and incenting and motivating them to do the things that bring you business value.

You’re spending a lot of time and money to get people to your business, and then on generating the content that you hope they will consume in the way that you want them to, but you’re not directly influencing them to do the things that make you money. And because of that, you’re leaving money on the table. But therein lays the opportunity – to influence your users’ behavior, in real-time, and the best way to do that is with gamification.

Money to make

We’re all human, and we all want and need things like reward, status, achievement, competition, self-expression, and even altruism. Yet you look at most sites and applications today, and how are they addressing these fundamental human needs? They’re not – they’re completely ignoring them. But game designers have known for years how to incent and motivate user behavior, and they do it through the use of game mechanics – things like points, levels, high score tables, virtual goods, and badges. The reason these game mechanics work is because they satisfy our human needs.

Companies like NBC, Hasbro, MySpace, Comcast, LiveOps, USA Network, Warner Bros. have realized this. They are using Gamification on consumer-facing websites, to motivate employees, sales people and partners, and are seeing dramatic results around page views, time on site, repeat visits, brand affinity, advertising revenue, subscriptions, sponsorships, e-commerce, and more. Our customers have seen page views double, pages per visit increase 60%, unique visitors increase 30%, time on site increase 100% and a doubling in repeat monthly visits, leading to an ROI of 400% and up, with a payback time of as little as 3 months.

Can your site or application be gamified? Anywhere there are people to be motivated, you can use gamification to motivate them. If you’re not, you’re leaving money on the table.