Ever heard the quote: “Life’s a game, all you have to do is know how to play it”? Sure you have. But who would have guessed it would become the battle cry for an increasing number of companies. At least that’s the way it seems with all the buzz about gamification. Enterprises far and wide are now hoping that adding game mechanics to interactions with employees, customers, and prospects will drive engagement and energize business results.

As a matter of fact, Gartner research predicts that 40% of Global 1000 organizations will use gamification to transform business operations by 2015. Venture capitalists have also gotten into the act pouring millions into leading gamification technology companies like Badgeville, PunchTab and BunchBall, No wonder Gartner is also forecasting that gamification will be a $2.8 billion market by 2016.

Why does gamification work?

The answer comes from how we (as humans) are motivated by incentives. Offer your cube-mate the right incentive to do something, and don’t be surprised when he actually does it. And the best incentives tap into the wide range of our emotional needs and desires. For example: our need to improve our status, be acknowledged, express ourselves, and (of course) win. Mix-in game mechanics such as rules, point systems, leader boards, badges, and things start to get interesting fast. Done right, even boring work starts to get fun!

Gartner further points out: “gamification can actually change brain chemistry, stimulating dopamine, the brain’s feel good neurotransmitter”. That means gamification can truly influence the behaviors of customers and employees by changing how they feel. Do this at scale and you can radically transform how your company performs. We’re talking game changer. That’s the idea anyway.

Technology is making gamification possible

While the notion of gamification has been around a long time, the challenge has been how to “gamify” an organization and its many customer touch-points. Not anymore. Today’s gamification technology platforms enable companies to snap on game mechanics to processes and interactions that employees and customers already leverage other technologies for. Including incorporating how people interact with your company’s website and social properties like Facebook, Twitter, and Google+.

Bingo! New employees get cool t-shirts for crushing training programs, website visitors earn points for tweeting-out content; and community members get stickers for answering buyer questions. And gamification technology tracks who does what, how often, and when. So now it’s a piece of cake to figure out who should get that awesome prize for coming up with the “idea of the day”!

Is gamification right for your company?

Well that depends. Like all new technology initiatives, gamification offers plenty of potential but can also turn into eye-rolling and career-risking frustration. No surprise then that Gartner says 80% of gamification implementations will fail by 2014. Why? Because not enough thought will be put into how to design and “tune” game mechanics for a given company’s culture, target audience, and desired objectives. Simply put, if the game aspects suck then no one will want to play.

With that in mind, here are seven questions to consider before yelling “game on!”:

  • Who is your target audience? This could be your customers, employees, website visitors, prospects, free-trial users, etc. The more specific you can be the better.
  • What are your overall goals and objectives? Looking to deepen customer loyalty? Encourage more employee participation? Foster engagement with your products? Build brand awareness about a new service? Understand the goals your trying to achieve with gamification.
  • What actions do you want to encourage? Make sure the actions you want are closely aligned with your goals. For example, if you want more customer loyalty then offering an incentive to answer prospect questions, share offers, and cough-up product feedback may all make sense.
  • How will you gauge progress? Which metrics will you use to judge and value the performance of your gamification initiative? If you want to mobilize employees, then maybe it’s the level of participation or engagement that should be measured.
  • What types of rewards are you planning to offer? Incentives and rewards must be closely aligned with who your target audience is and the actions you’re looking for. If not, then your gamification implementation will be doomed to fail (sorry!).
  • How will you promote the program? What methods will you use to get the word out about your gamification initiatives? Promote it on your website, company-wide emails, build it into your product experience? It’ll be hard to get everyone playing if no one knows about the game.
  • What’s your budget? Depending on your gamification plans, your budget may need to include: promotion expenses, reward costs, creative work, and technology platform fees.

Here’s another key piece of advice: start simply and get expert help (you’ll probably need it). Otherwise, be ready to roll-the-dice that your gamification implementation will be part of the 20% that Gartner says will succeed.

Want to learn more about gamification and how to engage digital consumers? Check out the Get More Engagement blog.

[Note: this post first appeared on Get More Engagement which covers engagement marketing trends, tips, and advice.]