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Gamification and startup failure

Team Gametize
Gametize Academy
Current research indicates that 70% of American workers are not engaged, costing the US economy approximately $370 billion in lost productivity and sales.
According to various opinions and experts, startups fail mostly due to five reasons:
  1. Founder/management problems
  2. Ignoring/forgetting target customers/clients before building the product/service
  3. Running out of capital before gaining traction
  4. Market-product problems (lack of compelling value proposition to engage customers; wrong timing)
  5. Business model failures (optimism about acquiring and retaining customers)
Points 4 and 5 are usually a result of failing to engage potential customers/clients/market.
Point 3 is caused by not generating enough revenues, which means either erroneous forecasting or failing to acquire enough customers/clients or unexpected market reaction, all of which are tantamount to failing to get enough customers/clients to stay afloat or break-even.
Point 2 is about either not doing market research or getting a wrong feedback/signals from the target market/audience.
And in certain cases, point 1 ends up causing a problem for the brand (creating brand loyalty and awareness) and thus damages it.

The two pillars that will make or break a startup

A brief look at most of the points above shows that customer acquisition/ engagement/retention and brand loyalty/image/reputation are the two key pillars, which make or break a startup, especially at its early stage of development.
These two pillars, customer and brand, are also at the heart of why gamification is considered as an essential methodology for many big and small companies which look at ways of reviving/launching/increasing their customer and brand pillars.
According to one M2 Research, nearly half (47%) of client implementations focus on user engagement, while 22% revolve around brand loyalty and 15% are focused on brand awareness. Therefore, gamification seems to be especially effective in three business areas: customer engagement, brand loyalty and brand awareness.
Another M2 study points that consumer-driven gamification commanded more than 90% market-share in 2011. Vendors claim that gamification can lead to a 100% to 150% pickup in engagement metrics including unique views, page views, community activities, and time on site. A recent Saatchi and Saatchi study claimed 58% of respondents think it is important – i.e. they will engage with the brand – for brands to be playful and fun.

What does successful engagement mean?

Previously, Forrester defined successful engagement as degrees of the four I’s: involvement, interaction, intimacy and influence. Gamification utilizes these strategies to enhance communication and action, and in turn, create more compelling and memorable experiences for customers.
“Industry research shows that 27 million web sites launched in December 2011; that’s 383 million more sites than there were in 2010,” according to another report. “Clearly the audience size is growing, so competition for consumer eyeballs is becoming more intense. Gamification can help retailers differentiate their message, engage more users and provide more compelling experiences.”
To conclude, gamification, intuitively speaking, has always been a one approach that startups could have relied on in order to maximize their chance of not only surviving but also thriving. And since few years ago, there are an increasing number of gamification tools and methodologies being made available on the Internet, which can and must be adapted by startups if they want to stand a chance of launching and existing in the increasingly overcrowded Internet world!
Published on 11 May, 2014
Revised 11 March, 2020

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