Gamification 2.0: We Don’t Need No Stinking Badges

I learned at a young age that being good in grade school to earn a gold star wasn’t really worth it. Given the fun I had cracking jokes, passing notes, and in general being disruptive, earning a shiny sticker on a chart was not much of a positive incentive.

I took the same attitude toward consumer gamification as software vendors began to add whimsical ‘game’ features to encourage engagement. Most were nebulous systems to earn points that didn’t seem to add up to much more than some acknowledgement. Play the next level to get a badge with a cute name. In other words, a virtual gold star.

It basically comes down to ROI – is it worth investing my time and effort to do this? Until recently, the answer has been a resounding no. I’m not motivated by a goofy badge and a notch up on the leaderboard. But discount a product I want, and I just might play the game. And come back. Walgreens and Scotts Miracle-Gro Company, for instance, have successfully boosted loyalty with gamification programs that offer real rewards. Coca-Cola offers mobile activation at events through gamification.

In fact, the gamification programs that put some skin in the game and offer real rewards are the most effective. If the goal is to engage new users and build loyalty beyond the hardcore fan base, badges and gold stars won’t do.

Advocacy marketing, for example, has emerged as a hot new area that has been bullish on gamification as a means to spur social activity. Customers that post and tweet can earn badges and in some cases points. If they are lucky, they might even get enough to redeem a give-away T-shirt or coffee mug. You know, the left overs from the last trade show.

But all this does is encourage your most enthusiastic customers to be even more active. You already have them and there is little value in increasing their loyalty. In fact, gamification programs can make loyal fan(atics) seem overly enthusiastic and less genuine. Which can damage your brand.

Gamification’s real promise is to engage customers and prospects beyond core devotees. Understanding what they want and how best to incent them will bring the best results. It’s all about customer engagement which leads to richer data about the customer.

And once companies start to successfully engage customers with gamification, their CRM system needs to be ready to capture that engagement data and analyze it to develop a deep, timely understanding of customers’ likes, dislikes, and motivations. Forget virtual badges or gold stars. The true ROI from gamification comes when real incentives get customers to open up about what’s most valuable to them.