Gamification is Serious Business

Get ready. A gamification-related startup is coming to a pitch meeting to you.

So says a trio of VCs from a panel I moderated earlier this week during the Vator Spark inaugural gamification conference in Berkeley, Calif., called Get Game. The VC panel consisted of Tim Chang from Mayfield Fund, Lars Leckie from Hummer Winblad Venture Partners and Charles Hudson from SoftTech VC.

The VCs—all of whom said they’ve played games their entire lives—discussed their interest and observations about gamification, the use of game design techniques and game mechanics to enhance non-game contexts. For instance, think about rewarding users with badges or others virtual prizes for their activity and engagement on a website.

Companies such as Kiip, which is backed by Hummer Winblad, provides a rewards platform to allow giveaways in any type of app, not just games.

While the VCs noted that some companies are providing gamification solutions, such as Badgeville (which provides gaming features for Web publishers) and Bunchball (which provides online gamification services for consumer brands and media outlets), more often these days startups are incorporating gamification features in their offerings.

“I don’t know any consumer facing enterprise that isn’t interested in adding more engagement” Hudson said during the panel.

Another example is Lithium Technologies. Although none of the VCs on the panel had invested in it, the company, which was founded by pro gamers, has raised more than $90 million in funding. The company works with consumer brands to find loyal customers and help build online communities around the brands.

During the panel, Chang said it’s important to look at usership when deciding how to gamily your business.

“Tie the game into business goals, engage users, retain them, and then convert them. Game mechanics are there to help you track reaching the goals you have, not to just give users another thing to do,” he said.

And there are exits that gamification advocates can point to. For instance, Rypple (which I wrote about for Reuters nearly two years ago) develops human resources software with gamification-like components. The Toronto-based company was bought by Salesforce in March.

“As more enterprise businesses see this community and gamification value, you will see more developers and companies snapped up just like Salesforce grabbed Rypple,” Hudson said.

The quotation of the day, however, belonged to Leckie. The panelists pointed out that a new talent pool of gamification engineers is cropping up from Zynga and Foursquare. They said just like social media has created experts in that field, gamification developers are joining businesses that wanted to retool their websites and services to engage their customers.

“Much like the porn industry [saw its engineers hired] in the early days of the Internet, gaming developers are good in a specific skill set and enterprise and other companies will go to them to change their methodology,” Leckie said.

For more thoughts about the panel and the gamification conference, you can read Vator’s writeup here.

Photo of 3D text from Shutterstock.