Ian McCarthy: Understanding the principles and value of Gamification

The rapid emergence of gamification as a viable business tool has seen some astounding successes in recent years – including innovative marketing campaigns for hip-hop moguls, airline frequent flyer programs, and sticker albums for global sporting events.

But what is gamification, and what can business do to leverage its potential? This was the subject of a fascinating lecture from Professor Ian McCarthy, Associate Dean of Graduate Programs at the Beedie School of Business, at the 2015 Beedie Alumni Reunion.

The event, held at the Segal Graduate School on March 31, saw a keynote presentation from McCarthy on his new study on gamification. The research, conducted with Beedie faculty Leyland Pitt and Jan Kietzmann, Beedie PhD student Karen Robson, and former PhD student Kirk Plangger, examines the effectiveness of gamification as a method of increasing engagement among stakeholders such as employees, customers, and students.

Described as “the application of lessons from the gaming domain in order to change stakeholder behaviors and out-comes in non-game situations”, the term “gamification” emerged around 2010, though the phenomenon has been used effectively in business for some time.

“It’s not about creating games, its about learning from the world of gaming and learning from the psychology and behavior economics that go in there and why they get such fantastic levels of engagement,” said McCarthy. “It’s about gamifying non-gaming situations: processes that happen in various industries. How can we learn from that in order to understand and control the behavior of stakeholders?”

The study examined companies that had gamified certain processes such as training and recruitment in order to understand why they had done so. It also looked at the computer games industry, and identified components of a framework to help explain gamification.

McCarthy cited several examples from popular culture of gamification being used to great effect as a marketing campaign. Jay Z’s book launch campaign in conjunction with Microsoft’s search engine Bing, for example, resulted in Jay Z receiving some one million new social media followers in the space of one month. An interactive Tippex commercial, meanwhile, saw sales rise by 30 percent for what is essentially a dying product.

“In each case, the key to the success was that the level of player engagement was extremely high,” said McCarthy.

The research revealed three reasons for the rise of gamification: the quest to get a reaction; the pervasiveness of technology; and the growth of the video game industry, valued at some $30 billion.

McCarthy cited the example of popular video game Call of Duty as evidence of the level of engagement within the gaming community that businesses must strive to emulate using gamification practices. The most recent edition of the Call of Duty franchise racked up some $775 million in sales within its first five days of release – more than any Hollywood movie. Gamers have spent approximately 25 billions hours playing the franchise, or over 2.85 million years.

Such dedication is down to three intrinsic motivational factors: competency building, where the player attempts to master a task; autonomy, where the player can experiment and customize the experience; and relatedness, with the experience providing the player a sense of purpose.

The participants in gamification fall into four categories: Designers, who design, manage and maintain the gamification experience; players, who compete in the experience; spectators, who witness the gamification experience but can also influence it; and observers, whose role is solely to watch.

Further to this, McCarthy noted that the gamified experience is broken down into three principles: the mechanics, the set-up, rules and progression; the dynamics, or the player behavior; and the emotions, or the players’ state of mind. “If you get the dynamics, mechanics, and emotions right then you get powerful games where people are motivated to spend lots of time and money engaging,” said McCarthy.

To illustrate the overall gamified experience, McCarthy used the example of popular TV show American Idol, ranked the number one show in the US from 2003 to 2011. It uses gamification principles to engage customers – the viewers – and potential employees – the music artists.

Indeed, McCarthy cited the emotional experience of American Idol as one of the beacons of gamification eliciting an emotional response. “Imagine if you could engage your students, employees or customers the way the American Idol audience is engaged,” he said.

McCarthy cautioned, however, that while gamification can be a powerful business tool, businesses must approach with caution. “Rewards are not enough – it is the playing and the progress that makes the experience fun and pleasurable,” he said. “You are not designing a game, you are designing a business process.”

To view Professor McCarthy’s presentation, visit www.slideshare.net/IanMcCarthy/is-it-all-a-game-understanding-the-principles-of-gamification