Shane Snow is a regular contributor to Mashable and tweets at @shanesnow. This post was co-authored by Phin Barnes, a principal at First Round Capital, SneakerheadVC and creator of the Xbox game, Yourself!Fitness. He has also served as a consultant to MTV games.  Before Foursquare managed to storm social media, GPS friend finders and city guides did in fact exist. But, Foursquare quickly became a star, engaging hundreds of thousands of users in just a few months and turning them into evangelists for its product. It did this by taking the existing geo-social concept and turning it into a game. Video game-esque elements like “badges” and “mayorships” hook you long enough so that you discover the true utility of the app, and stick with it long-term.  Common game elements like points, badges, leaderboards, and levels are proven (and increasingly popular) ways to engage customers and encourage profit-driving consumer behavior. Foursquare is a great example of why these work. However, many proponents of this type of “funware” in product development and marketing miss the larger point: “How” you incorporate game mechanics is just as important as “Why” you should. A leaderboard alone does not make for a worthwhile or engaging game.  Trip Hawkins, founder of game companies Electronic Arts and Digital Chocolate, says that compelling games need to be “simple, hot, and deep.” They should be easy to pick up, instantly engaging, and offer you somewhere to go once you are engaged. Creating these kinds of games takes work.  Legions of online businesses are following this trend right now as they attempt to integrate game mechanics into their products. Investors used to hear customer acquisition plans that included, “and we’re going to make it social” or “and we’re going to make it viral.” But lately, these pitches have changed to include, “and we’re going to use game mechanics” to address customer acquisition and engagement.  Many of the “games” being built in this flurry, however, are certainly not going to be fun. Many will distract the user from the core value proposition of the application or service. At worst, copycat “game mechanics” will quickly become annoying and trite — destroying value for users and creators alike.  “One of the greatest risks is being unoriginal,” says Gabe Zichermann, author of the 2010 book Game-Based Marketing. In the short term, he says, adding soon-to-be-cliche elements like badges is OK, because any amount of additional enjoyment is good for a product. “But a good design takes into consideration the long-term scalability. If you think you can end with badges, that’s where you’re [expletive].”  Poor or late planning gives rise to boring (too easy) or frustrating (too hard) games. Since the goal of game mechanics is to keep customers coming back and doing what you want them to do, you want to stay far away from those two zones.  So how can you use game mechanics the right way and supercharge your business? We’ve distilled the process down to four steps.  Effective games cannot be bolted onto a service after the fact. They must be integrated into the product from the start. To work, they need to be designed with your vision in mind, or they’ll be largely meaningless.  The first thing you need to do is define your end goal. What is it you want to accomplish? What’s the big vision?  Now that you have defined the vision, you need to figure out what specific user actions will be required to realize it. What behavior patterns would they need to adopt in order to sustain your business model?  Think in verbs, not nouns. What do you need people to do?  Once you have this list, rank the items from most critical to least and also score them from most plausible/natural to least. Now you know where to focus your game-based psychology experiment.  Games can be used to drive almost any user behavior. As Marc Metis, President of Digital Chocolate puts it, “Games have the potential to tap into the full range of human emotions and motivate a wide range of behaviors.” That’s the beauty and value proposition of game mechanics. Take the specific behaviors you’ve defined and plan some games that will make people do what you want. No matter what type of game you are designing, a few key principles will help:  As with any lean startup process, you’ll only succeed if you’re willing to evaluate and adapt both the game mechanic layer and the behaviors that are critical to motivate. Both will change as you learn about your consumer, and as they learn how to play your game.  “Running a social game is a bit like being a head of a country’s Central Bank, so you are always adjusting,” says Metis. “You really have to pay attention to the finest details of user experience and merchandising.”  Re-rank and reevaluate often. Take honest looks at what users do and why. Remember, make it fun for them, not for you. Zichermann reminds us most entrepreneurs think their users’ primary motivation is to achieve. But, he says, most people — especially on the web — just want to socialize. “They’re not in it to win it, they just want to make friends.”  Make sure you understand your audience, and design your mechanics accordingly.  Ultimately, game mechanics are not about simply having fun. They’re about helping users discover the utility in your product. Like Wile E. Coyote from the old cartoons, you want to get your users to run through the air without noticing the ground’s not there, until they reach the other side. Games can help get them to cross that ugly gap of “Why should I learn about and adopt this product?” And once they’ve crossed, you’ll have them, because they’ll feel the utility of your service and understand why your product is great.  To finish with our initial example, Foursquare’s game mechanics alone aren’t that fun. But they’re fun enough to get you to stick with the service while you figure out how useful it can really be. That’s how Foursquare nailed it.  Right now, too many companies are building a bridge to nowhere with their games simply because games are trendy. Design an experience that will delight your users and use game mechanics to show them something useful that will add value and make their lives better.  - Top 5 Ways to Make Your Site More Fun - 5 Social Media Trends to Watch Right Now - Beyond the Checkin: Where Location-Based Social Networks Should Go Next - What the Future Holds for the Checkin - Are Location-Based Services All Hype?  Image courtesy of iStockphoto, Lobsterclaws
Gaming incentives are a great way to make your business model "sticky," but implementing them effectively can be a challenge. These four tips can help.