How to Have Fun in Banking: Gamification

Gamification. The very word is cringe-inducing, the epitome of a vaguely defined concept that consultants hype for a while but never actually has an impact. In fact, the term has to do with gaming mechanics (albeit in non-game contexts) which makes it even more fad-like. It’s also fair to ask what this has to do with banking anyway. We’re not here to play games and have fun, are we?

First, let’s establish some parameters.

Gamification is not about playing games—it’s about using a more creative and empathetic approach to engaging a particular audience in specified activities. Gamification has been around long enough to prove its success in fields as disparate as fitness, brand marketing and education, and even scholarly studies confirm its effectiveness. It’s not at all a stretch to see it bringing value to our discipline.

There’s also nothing wrong with incorporating fun into serious tasks, as long as they serve the ultimate purpose. If fun tools on a mobile app can motivate users to, say, go for a jog or do more homework, then why can’t it be used to keep a closer eye on the monthly balance?

This is exactly why research house Gartner has been quite bullish about the field—two years ago, it predicted the size of the overall market will approach $3 billion in 2016—and the concept is getting more attention these days. A recent article in The Financial Brand delves deep into the topic and explores just some of the areas that could benefit from gamification-like features.  For example, imagine getting younger consumers to better understand banking principles, or recognizing retiring loans and rewarding particular milestones, or extracting better data, or enhancing brand loyalty.

These are no longer abstract concepts: Forward-thinking institutions in many regions are actively pursuing initiatives in exactly these areas.  Two years ago, it was reported that much of the activity in this field was happening overseas, and that’s still happening. For example, Hana Bank in South Korea has won awards for gamifying some aspects of its online and mobile statements. Similarly, DSK Bank in Bulgaria has added gamification layers to numerous functions.

As with many innovations, it’s important to focus on the fundamentals rather than the fad.

In essence, what effect is the gamification-influenced features designed to have? Will they better educate customers about the bank’s offerings, particularly those available via online and mobile platforms? Are they for prospects considering a change of institution? Could they enhance brand loyalty? Could they turn up better research on customer habits? Or could they be kept internal, boosting productivity and employee dedication?

The answer can’t really be ‘all of the above’—there needs to be a specific set of goals, with outcomes measured and tactics adjusted on a regular basis.

Similarly, the tools used for the purpose need to be designed by specialists in the field. Gaming and banking are two inherently different disciplines, and for these initiatives to work they will have to be propelled by technology developers who know more about gamification itself than about financial services. Doing it in-house, at least at the beginning, might not be the best way to go.

Ultimately, gamification will only go from trend to table-stakes when it’s fully enmeshed in each company’s strategic operating philosophy. It won’t replace ongoing initiatives related to online, mobile, retail, etc.; it’ll be another weapon in the arsenal, a fundamental component used to engage users, partners and customers alike and therefore bolster the bottom line.

This is widely predicted to be the year in which gamification truly takes off. Of course, the same thing was said about last year, and perhaps even the year before. Watch this space.

Written by Jack Dougal

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