Fun Shopping : A Randomized Field Experiment on Gamification

Gamification utilizes game-like features to engage participants, widely implemented in a variety of contexts. Such an IT-enabled engagement strategy can serve as an effective marketing tool to boost sales and customer loyalty in business domains. Contrasted with traditional couponing pushing extrinsic monetary motivation to consumers, gamification pulls consumers' intrinsic motivation or promotes the importance of social image. This study attempts to characterize the distinct natures of the three mechanisms and empirically quantifies the significances. We specifically study two of the most significant gamification features, namely, badge and leaderboard, that leverage intrinsic motivation and social image, respectively. To quantify the effects of the two, we conduct a randomized field experiment in one of the largest shopping malls in Asia. In the experiment, we study how gamification, benchmarked against couponing, affects shopping behaviors. Our two-period experiment design consisting of the treatment and post-treatment periods helps identify the long-term effects of gamification and couponing after the treatment removals. The main results suggest that badging and leaderboarding promote sales by 21.7% and 22.8% in the treatment period, respectively, while couponing delivers a stronger promotion effect of 32.0%. When we consider the time horizon, the impacts of gamification remain significant in the post-treatment period, but the influence of coupons immediately evaporates right after they expire. Besides, the additional analyses document the significant heterogeneous treatment effects across demographic factors. We also discover the substantial difference in the within-group heterogeneity between the two games, suggesting that consumers respond to a leaderboard more differently than badges. The robust results provide useful managerial implications to utilize gamification proactively