Consumer Behavior: Tapping into the competitive element

Photo: Jeff Kubina (Flickr)

Unseasonal rain fell in California this weekend requiring us to put into effect the Emergency Indoors Plan to keep the kids occupied. Board games too optimistically stacked away on top shelves had to be brought back down. Wii Go Kart and computer games fired up.

Soon, my daughter (6) and I were locked in battle over Balloon Lagoon while my son (8) was off on a JumpStart adventure. Calm reigned briefly.

The power of games to motivate and shape consumer behavior is well known. Video game designers are, in fact, so good at doing this that it's easy for people to spend hours and hours lost in game play. But the consumer instincts that game designers tap into are not leveraged very often by consumer marketers. Why not? Can't some of these game mechanics be used to motivate consumer behavior in other contexts? Aren't there opportunities beyond the world of the promotional contest?

Rajat Paharia thinks so. He is the founder of Bunchball, a company that is beginning to tap into our competitive nature to reward and build loyalty. Bunchball has taken a look at some of the essential elements of games (points, levels, challenges, leaderboards etc) and started applying them to the non-gaming world. Its first application of these principles can be seen on NBC's DundlerMifflinInfinity site where Office fans can join the company and work their way up through the organization, earning Shrutebucks as they go.

As this Forbes article (written by Bunchball's CEO) describes, these applications are successful in their own right, driving big increases in desired behaviors such as time on site and ad pages consumed as well as in more traditional metrics like purchase intent and brand favorability. But I think there's potential for applications that move even further away from these gaming roots. One example used by Rajat: Couldn't Yoplait dump its old-fashioned mail-in lids promotion in favor of revamped program that would track total points in real time, use a leaderboard and build community engagement? (See pp 32 to 34 of this deck.)

Once you start looking, you can see elements of game mechanics being used successfully. Look at Twitter, Facebook and LinkedIn. They all use the points/leaderboard motivator. That's why it's tough not to get sucked into playing the followers/friends/contacts game. It's powerful stuff and I expect that, as marketers look for new ways to engage with consumers, this will be a field that will start to receive a lot more attention.

Meanwhile, back in our house, as the Battle of Balloon Lagoon neared its conclusion, my daughter demonstrated her own mastery of gaming psychology. I had well-deserved victory in sight when she fired off: "Well if you win, we have to play again. If I win, we're done." After a couple of botched frog-jumps on my part, she was soon able to declare:

"I'M THE WINNER!" and give a little dance too. I'm going to win next time around.

How did Slumdog get its Millionaire?

Photo: Shabbir Siraj (Flickr)

Great movie (see Ebert's review here) but I couldn't help but wonder afterwards how on earth the producers of "Who Wants to be a Millionaire" ever gave permission for the quiz show to be used. Without giving away the details, the movie portrays the show pretty badly, connecting it with torture, collusion and cheating. Not your typical product placement.

Luckily, I wasn't the first to wonder that and I found this article by Aaron Barnhart of the Miami Herald. He has done some digging and reports that Celador, one of the production companies behind the film, is also the company that created "Who Wants to Be a Millionaire." It sold the international rights in 2005 and used the proceeds to focus on the movie business, including this movie which (I think) undercuts the show. Nice.

But maybe it's all going to work out. Josef Adalian, writing in TV Week, says that ABC is considering bringing the show back to primetime. He thinks that the “Slumdog Millionaire” connection is a positive since it puts Millionaire "very much back in the cultural zeitgeist." It certainly does that and perhaps that's the most important thing? Contestants better be on their toes, though, if they answer too many questions correctly.

How long will the nation shoppers resolve to stop spending?

Photo: chrisphoto

We're two weeks into the New Year. Still feeling good and strong about those New Year resolutions? Sliding on anything yet? Or still confident that, this time, you're really going to make it and stop/reduce/cut out whatever long-held bad habit you've chosen to tackle?

Lee Scott, the outgoing CEO of Wal-Mart, thinks that the recession may have caused a "fundamental change" in our shopping habits. Speaking at the National Retail Federation's (NRF) convention of retailers and suppliers in New York, Scott cited a recent meeting with young shoppers. They told him they aren't eating out or going to the movies any more. "Everyone has given up something and said how good they felt about it," he said.

If over-consumption is the bad habit that Americans have been indulging in, Scott sides with those who believe that the recession will give us the resolve to change. I don't agree. I think that our resolve will fade away and we'll go back to shopping a go-go just as soon as the economy lets us. Or perhaps a couple of weeks afterwards.

As I mentioned in my weekend post, we've been here before. Back in the 70s, in a previous recession, Jimmy Carter said: "We’ve discovered that owning things and consuming things does not satisfy our longing for meaning." He was wrong. Do we really think things will be different this time after the fun of frugality wears off?

The Ponzi and the Caveman

In light of what may turn out to be the biggest Ponzi scheme in history, NPR asked the question: Why are people so prone to making irrational decisions when it comes to money?

It may be that our inner caveman is to blame. There's an old part of the brain that responds to things like food and water and other sustenance. When big rewards are within reach, this part of the brain gets all worked up and takes control.

As Camelia Kuhnen from the Kellogg School of Management describes, casinos have long figured out how to activate this: "When you enter into a casino floor, you are surrounded by cues of potential reward. Free food, free drinks, beautiful people walking around scantily clad. And those sights of potential reward will increase activation in the brain's reward area which will make you take more financial risk. You're going to gamble more at the roulette table."

Same thing for Ponzi schemes and bubbles. The possibility for enrichment taps into a deep desire not coming from the most rational part of the mind. As the report points out, no-one is immune for this. In fact, the most likely victims of financial scams are college educated, married, male, earning above the median income and financially literate.