I believe that this trend represents something much bigger than just explosive growth in the gaming industry. For years, many of the world's smartest people, from psychologists to behavioral economist to marketers, have been studied what motivates people to perform specific actions. In marketing terms, the most important of these is the purchase impulse. Today, the research on buying behavior is beginning to be reframed in terms of gaming mechanics.
Game mechanics are the rules and rewards that make a particular game fun and gratifying. I eat a ghost in Pacman and get 200 points. I pull a lever on a slot machine, 3 cherries line up and bells ring while money pours into my hands. Farmville and other social games have mastered these mechanics to combine highly addictive positive feedback loops with viral social play. Users compete with each other for status, measured in "levels" while paying real money for virtual items that enhance their gameplay.
Marketers need to pay attention to this for a few key reasons. Most obviously, there is a large consumer audience attached to these games. Farmville just launched a massive in-store 5 year partnership with 7-Eleven that includes broad in-store co-branding while rewarding cash purchases of hot dogs and Slurpees with Farmville currency. More important however, is applying the lessons being successfully demonstrated by these games to promotional and branding efforts.
Rewards and loyalty programs have been doing this for years in the form of points and frequent flier miles. These strategies have proven extremely effective, but can now be applied to digital and other marketing efforts to even higher levels of engagement and brand loyalty. A good example of this Bunchball ( www.bunchball.com ), a San Jose-based startup whose technology allows brands to integrate challenges, leaderboards and virtual rewards into their website. Their customers, which range from NBC to Victoria's Secret, are delighted to be able to map any desired activity to a reward. For example, a user might be given 500 points to visit a particular page on the site or 1000 points for joining the brand's Facebook group.
Gamification is a trend still in its infancy, but one with great promise. If you want to dig deeper, I recommend watching this stunning 30 minute presentation by Jesse Schell at DICE or Jane McGonigal's speech on How Games Can Save the World. Can you think of other ways this might be applied in the future?