What Social Commerce Can Learn From Social Gaming

What could social commerce learn from social gaming?  Quite a lot we think – especially after viewing the most excellent presentation (embedded below, with slides) from Jesse Schell, Professor of Entertainment Technology at Carnegie Mellon University at the 2010 DICE Summit (Design, Innovate, Communicate, Entertain).

Schell discusses how game psychology drives the commercial success of social games; the games are built ground-up to drive use and sales; psychology is programmed into the app – with compelling incentives, rewards and challenges. Less than two months old, there are now 7x more people living in Facebook’s CityVille from Zynga (100m monthly users) than people living in Paris than live in the world’s largest city, Shanghai, more virtual tractors are sold in FarmVille every day than real tractors are sold in the US every year, more FarmVille players than Twitter accounts, 90m Pet Society game virtual goods sold every single day, contributing to the social games-driven virtual goods market generated $7,300,000,000 in 2010 (12% of the entire video game industry).

Compare the success of social gaming to that of social commerce – sure the big social commerce platforms – Facebook, Groupon et al, and Gilt et al are making waves – but we don’t have our Cityville yet.  To find our inner-CityVille, we’ll need to move beyond simply helping people connect and buy where they connect.  Sure, social commerce is about adding a social layer to retail and a retail layer to social, but it’ll only fly when it is fun and rewarding.

So what can we learn from social gaming?  Well, the success of social gaming, according to Jesse Schell, comes down to how psychology is baked into the software, and that makes social gaming addictive.  Social gaming is about people, not software.  Ditto for social commerce, we say.  Build your social commerce strategy from a people-perspective, using psychological insights to make your solution addictive.  Critically, your social commerce solution has to be designed – like a game – rather than merely be a plugin.

The success of social gaming is due to the fact that it taps into something bigger than gaming, human psychology; humans are reward-based creatures – and games are designed to be rewarding, offering the four big ‘SAPS’ rewards.

• STATUS
• ACCESS
• POWER
• STUFF

We think social commerce could do far worse than take a leaf out the obscenely profitable social gaming book and offer SAPS rewards – as well as game mechanics such as levels, challenges, collecting, points, feedback, exchange and  customisations to guide people through the customer journey, from discovery through to loyalty and advocacy. So hire a social gaming developer, or at least have a social gamer on the project team.  Your brief – a social commerce solution that is crack-cocaine for shopping.

Specifically, from Schell’s presentation:

• How could you use the “Club Penguin” strategy – a game that is free to play, free to earn virtual money – but then you need to pay for membership to spend the money.  Subscription-based stores anyone?
• Do the “Webkins” trick – a product that spans the physical/digital divide – if your product is physical – like a soft toy, what’s the digital (magical, connected) one that lives inside and that can be accessed from a screen? If your product is digital, how can your product break through to reality. Successful games are not about escapism to an imaginary world, they are crossover games with real, authentic features – think the Wii Fit, Guitar Hero, as well as Webkins. Technology used to cut us off from the real world – now we use it to get back to reality.
• Do a “Mafia Wars” and get people to compare themselves to their friends, and allow them to pay to better their friends
• Do a “Ford Hybrid” nudge customers towards desired behaviour with a game – Ford cars have a virtual vine on the dashboard that grows as you save fuel.  Smart shopper points?
• Do a “Microsoft Kinect” – add sensors to the retail experience that rewards people for smart moves
• Set up a “Slot Machine” – set up a virtual slot machine, cash if you win, store vouchers if you don’t. Licence-To-Print-Money
• Do a “Simpsons” – Geo-caching scavenger hunt, embed clues on the customer journey
• Do a “Weight Watchers” – points for eating smart
• Use the Psychology of Sunk Costs – our tendency to overvalue what we buy, and the time we spend.  The more time people spend (invest) with you, the more valuable they will think you are
• Think Lead Generation, not Direct Payments – a  large proportion of social gaming revenue not purchases, but affiliate payments (points/virtual money for signing up for a credit card, site etc).
• Plan for the “Web of Things” – the future of social commerce will be connected devices with sensor – a web connected CPU, screen, and sensor (camera) on your soda can and cereal box.  Rewards for brushing your teeth, for playing game on cereal box, for taking the bus to work (to get you tax incentive rewards, or walking to walk to get Health Insurance rewards). Or rewards for dreaming about brands you remember from subliminal messaging on your REMtertainment system, and rewards for school performance (with good parenting rewards), rewards for displaying brands on your e-ink digital tattoos (Tattoogle Adsense), rewards for consuming brands, rewards for watching ads – with eye sensors on screens, and for reading books on your e-reader

Bottom line, how do you get social commerce to work? Start with the smile.  Make it fun by turning it into a game.  Game-based commerce + social commerce – that’s the path to fortune.

Presentation Slides