Gamification: fun becomes cash flow

Today's companies are not to be envied compared to their predecessors from the last century: Henry Ford could still (successfully) take the position that you could have your Model T in any color you wanted, as long as it was black. He could afford to do this because at the beginning of the last century, capacity and therefore company productivity was the key bottleneck in the markets.

This is also made clear by the criteria used by historians to classify the phases of industrialization: A new level is always initiated by a new key technology in production (steam engine, assembly line, computer and currently the Internet of Things). The history of the economy over the last 150 years is therefore still told entirely from the perspective of the supply side of markets. And indeed, this industrialization is a success story that has brought us an unprecedented increase in available goods and services.

The fact that customer experience management is an issue for companies today is due to a decisive side effect of this very success. In the beginning, the explosion in output was met with eager demand. If the alternative to a Model T, which is affordable thanks to modern technology, is "no car", then the color really is a minor matter. But since the middle of the last century at the latest, progress in optimizing the supply side has itself ensured that the bottleneck for companies has increasingly shifted from production to sales. The customer came into play as a criterion for success.

What exactly is "the business of business"?

According to an infamous (and false) saying by Milton Friedman: "The business of business is business." It is true that companies - at least in a market economy - can only be successful if they create value for customers and if they can simultaneously skim off a portion of this value - in the form of sales. The way in which a company organizes these two tasks is called a business model.

The question of the value that a company's own output has for a customer has therefore always been central. But what customers experience as valuable has shifted significantly over time. B. Joseph Pine and James H. Gilmore have made a very good suggestion for a description of this shift in their book "The Experience Economy" (see graphic).

This development explains both the topicality of the topic of "experience" and, above all, its strategic importance. If you want to remain competitive as a provider, you have to stand out from the increasingly less differentiated field of providers of goods and services and create "experiences". Today's customers no longer order a car, they buy the "joy of driving".

The radical consequence for companies: Value creation as an experience no longer takes place in the company, but in the head, stomach or heart of the consumer. However, the customer's psychological interior is beyond direct access and cannot be controlled and optimized with production resources. This is why companies need new skills in order to systematically process the perceptions, emotions, attitudes and feelings of their target groups: The role of customer experience management is born.

Customer Experience Manager - Mission Impossible?

Customer experience managers are therefore supposed to manage something to which they have no direct access. In addition, if you want to create an experience, you first have to be noticed, i.e. attract the customer's attention. Digitalization on the consumer side, keyword social media, has escalated this task into a battle on the battlefield of channels and touchpoints.

After all, there is no such thing as THE customer: How an experience turns out depends, among other things, on the context of the action, individual history, personality traits, preferences and situational factors. And many of these factors are not even known to the customers themselves.

Game-based design as a role model

Game designers face even greater difficulties in the battle for the attention and resources of their target group, because they also have an even more serious problem: the activities that games encourage are, by definition, pointless.

Against this backdrop, it is all the more astonishing that game designers still manage to systematically and regularly create top experiences. And on a huge scale. Today, the games industry generates more revenue than the film and music industries combined. You can now guess that there must be something that game designers do particularly well and that CX managers could also take a leaf out of their book.

Under the buzzword "gamification" as "the application of game design principles in contexts other than games", they therefore became the focus of research a good ten years ago. Researchers began to investigate how the know-how and methods of game designers could be put to good use for companies.

If game design strategies are to be transferred to the corporate world, then the purposelessness of action in games proves to be an important starting point. It can be assumed that the CONTENT of the action is irrelevant for the enthusiasm of the players. This leaves the CONTEXT of the action as the cause. This is created by cleverly combining game design elements in such a way that the desired experience is generated in the interaction between player and game.

In recent years, we have learned a lot about what works - and what doesn't. Here are the two most important insights and take-aways for customer experience managers:

Design for motivation, not for reward

Nobody plays because they are paid to do so. Or because they want to get points or medals. Strictly speaking, you don't play because you want to win. What drives people to play - and what gets them into the flow - are universal intrinsic motives and needs that we as humans have always had. The three most powerful are social relationships and the experience of one's own competence and autonomy.

Accordingly, games invite us (-> autonomy) to accept challenges (-> competence) and to master them together with others (-> social relationships) and often in different ways (-> autonomy) (-> competence). Victory is the sign that you have made it.

Companies rarely rely on these intrinsic sources of commitment from their customers. The positioning on the market is usually aimed at usefulness and is primarily transactional - performance in return for payment. Exceptions and expressions of successful motivation design are, for example, communities of customers or employees. Their members are often motivated by affiliation and mutual assistance or by the achievement of a common purpose or the accomplishment of a common task.

Why don't you try asking yourself the question: Which relationship could your customers build or which challenge could they master with your help? And what experiences could be created in the process?

Thinking in journeys, not funnels

Successful games are designed for the long-term engagement of their players and invite them on a journey. The same applies to companies and their customers. And if you want loyal players (customers), you have to structure this journey over time. The most important game design element for this is storytelling. But beware: in this story, you are not the hero, your customer is. Your role is that of the guide.

The temporal segmentation makes it possible to take into account the different levels of maturity, skills and interests of the players. It is known from psychology that flow sets in where skills and challenges are in an optimal relationship with each other. Used correctly, this offers interesting opportunities for companies by challenging their customers.

Just for fun, think about what such a dramaturgy could look like for your customers: What would the typical phases of a game from onboarding to discovery, habit building to mastery mean in their customer journey? What skills could your customers build up with your help? And what could you expect them to do? What experiences could be created in the process?

Now it's your turn

Game designers are the undisputed masters in the art of creating great virtual experiences. As a customer experience manager, you can learn from them how to create an intrinsically motivating journey for your customers. Your big advantage here is that your customers' journey is more than just a game, it takes place in reality. This opens up all the possibilities in the world for you to get your customers into the flow in their everyday lives. So what are you waiting for: put on the game designer's glasses and make the first move!

Author

Wolfgang Rathert, lic.oec. HSG, heads the CAS Digital Customer Experience (hslu.ch/dcx) and is a lecturer in Game-Based Design and Community Building at Lucerne University of Applied Sciences and Arts (HSLU). If you would like to find out more about the possibilities of gamification in (digital) marketing (or in leadership): Wolfgang Rathert is looking forward to your challenge, with a guaranteed answer: Linkedin.com/in/rathert/

Would you like to find out more about gamification?

In a 40-minute "Online Briefing" on December 18, 2023, the author will answer the question "What customer experience does gamification bring?". As a reader of ORGANISATOR, you are cordially invited to attend and can also submit your own questions in advance. You can register for the online briefing, which will be held as a video conference via Zoom, here: https://smart-up.work/organisator-hslu.

In March 2024, the Lucerne University of Applied Sciences and Arts will also be holding another Executive Bootcamp. Learn more about the successful development and operation of communities and develop your own community design. Further information: https://tinyurl.com/ywduhld3.