Taking advantage of gamification in financial services
Jennifer Fuller, US Financial Services Lead at PA Consulting, authored an article for The Banker explaining how financial services firms can effectively use gamification to achieve success.
This article was first published in The Banker
If you feel like gamification is everywhere, you aren’t wrong. Recent data indicates that investments skyrocketed from $4.91bn in 2016 to $11.94bn in 2021. From leading global financial institutions to small start-ups, fintechs everywhere are getting in on this booming trend.
Recently, companies like Cake and AML entered the scene and grabbed the attention of users for their use of gamification to solve challenges such as helping banks glean valuable market insights through rewarding customers, and preventing money laundering.
Gamification is making an indelible mark in the worlds of personal finance, investing and more. It’s undeniably a powerful premise: capitalising on humans’ innate desire to be rewarded. However, it can be an expensive miscalculation if not executed thoughtfully.
Before jumping in, executives need to make sure they have a game plan for success.
To gamify or not?
Just because you can develop a gamification program doesn’t mean that you should. In fact, like any rash business decision, moving too fast can do more to hurt your bottom line or reputation than help it. Honestly assessing your goals for the program is perhaps the most important step in the process. Ask yourself the following questions:
Will this gamification program become more about the game and less about the business objective?
Do you have the capital – human and financial – to sustain a long-term program without causing burnout or boredom among users?
Are there any ethical concerns that the program design could potentially trigger addictive behaviour?
Over-gamification can also risk making products look less credible and therefore create reputational risks. For example, if you are looking to roll out a gamification program that seeks to engage and reward users for making smart investments in the stock market – think eToro – and your program is cartoonish or childish, you are likely detracting from the serious business of investing and may turn your audience off.
There is also no way around the fact that successful gamification programs require significant investment to build, bring to market and sustain over a long period of time. If you do not have the resources to continue to invest in tracking feedback and translating findings into program evolutions, your audience base will likely experience fatigue and cease engaging with the program.
Ground rules for success
If, after an honest assessment, your organisation is ready to jump into gamification, the next step is putting in place an infrastructure to ensure success. While there is no rulebook to which every start-up should adhere, there are several tenets that should compose the core of any successful gamification program:
Define the desired behaviours that will be influenced through gamification and put in place parameters for what success looks like for each defined behaviour.
Understand your customers and their needs and how to reach them in the market. Consider bringing your target users directly to the table during the design and iteration process. Or, use agile methods to incrementally release and test the product early and often to know what works with your audience. Seek product testers from relevant industry networks, forums and accelerator hubs and offer free versions for feedback. Use social media platforms like YouTube as a way to demo the product and gather feedback.
Incentivise early adoption and use early uptake data to better understand customer engagement timeframes. Incentives can include a fee structure that allows free early bird usage vs a fee for usage later (as employed by Investor Scout).
Create a community so that users can find purpose or a sense of togetherness. Consider a social network element where users can connect. Kazio, which established an operational support program that uses points boards and discussion forums to balance competition with knowledge sharing, is a good example of building community to influence behaviour.
Simplify; don’t create extra work by building games into existing processes. Users will resent the additional work or view it as a chore. Consider: how does this program save time rather than inconvenience the audience? Further, taking a ‘built to evolve’ approach with the design from the onset of program development should allow for easy adaptation if needed.
Identify and build strategic partnerships before, during and at the close of product launch. Look at these partnerships through a marketing lens: how can any potential partner help create a strong, credible brand and build your customer base.
Measure success with a structured tracking system to identify wins at several predetermined touch points throughout the program roll-out to determine if and how targeted behaviours have changed.
Find partners for success
Just as you should look for partners to market the uptake of your gamification program, organisations should also consider looking for partners who are experts in not only financial services but in gaming to support the development of the program.
It’s important that the product feels like a game, and this capability is often not inherent in financial services organisations.
Gamification is here to stay; it’s a proven tool that demands attention now and in the future. For some competitive and crowded industries, including financial services, keeping up to speed on both gamification capabilities and how your competitors are employing them could be a matter of sinking or swimming.
Whether or not you decide a gamification program is right for you, executives need to pay attention to these evolutions if they expect to compete in fast-changing tech environments.