The Six Contextual Types of Rewards in Gamification

Make your Gamified Experience Rewarding

Everyone wants rewards, right? But so often, companies fail to use rewards to incentivize their users or customers to take a specific action.

Here I’ll cover six different types of rewards that companies are using to build their customer base and develop engaged users and customers. We’ll focus on gamification rewards types and look at how you can implement the same rewards in your own business.

The goal of this post is to make applying gamification and Octalysis easier.

Some of you might feel the 8 Core Drives are still too abstract and want to jump straight into how to reward your users. Keep in mind, the reward context types below are not mutually exclusive. You can have one reward include multiple contextual types, but they are useful archetypes when you think about reward structures.

About the Creator of the Octalysis Framework

Yu-kai Chou created the Octalysis Framework after studying gamification since 2003, years before the term entered mainstream vocabulary. As a Human-Systems Architect & Behavioral Designer, his framework has been applied by LEGO, Microsoft, Porsche, Coca-Cola, Salesforce, and MrBeast, impacting over 1.5 Billion Users.

Chou has taught the Octalysis methodology at Harvard, Stanford, Yale, Tesla, Google, BCG, and IDEO.

His work has been cited by Harvard, Stanford, MIT, Forbes, Wall Street Journal, Wired, US Department of Energy, NIST, NSF, NCBI, US Department of Education, ClinicalTrials.gov, and 3,700+ more academic publications. Explore his books here.

Gamification Reward #1: Fixed Action Rewards (Earned Lunch)

The first type of reward within gamification is the Fixed Action Reward, or Earned Lunch (Game Technique #7). This is straightforward — the user knows exactly what she must do to get the reward.

Examples include anything that involves collecting points, frequent flyer miles, or punches on your card — loyalty programs of all flavors.

With these rewards, the company lays out exactly what the customer has to do to earn something and gives the customer a way to track how far they’ve come along in their goal.

Fixed Action Rewards engage customers by building their loyalty and rewarding frequent action.

For example, if a customer works near a deli shop that offers a free sandwich when he gets 12 punches on his loyalty card, that customer will be more motivated to grab lunch at the deli shop every day.

As the customer gets closer to completing his 12 punches, he becomes even more frequent at the deli because he wants to finish up his card and collect his reward.

This uses the three Left Brain Core Drives — Development & Accomplishment (Core Drive #2), Ownership & Possession (Core Drive #4), and Scarcity & Impatience (Core Drive #6).

Gamification Reward #2: Random Rewards (Mystery Box)

The second type of reward in gamification is the Random Reward (Game Technique #72). While fixed action rewards are great for helping companies build loyalty, they are heavily implemented and lack some right brain core drives that get customers really engaged.

In games, there is the concept of ‘loot’ or ‘drops,’ which are random rewards that appear once the player achieves a win-state or defeats an enemy. This unpredictable process is what drives players in the Endgame (Experience Phase #4).

With random rewards, the participant gets a reward based on completing a required action, but they don’t necessarily know what it is.

This doesn’t matter and can even enhance their engagement; the process of getting the reward is exciting because the participant knows they will be surprised at the end.

Using random rewards makes participants feel like they did on Christmas morning as a kid. They saw the rewards under the tree and knew they would find out what they were getting eventually. The anticipation of getting the reward, even though they have no idea what’s in the boxes, is part of what makes things exciting.

Quarterly is a subscription company that offers mystery boxes to its customers every three months. They source their themes from influencers like Timothy Ferriss, bestselling author of The 4-Hour Chef/Body/Work Week. These influencers hand-select items for their mystery box, and participants subscribe without knowing what they will receive.

Why would anyone spend $100 or more on objects they don’t even know about beforehand? Because the element of surprise is a reward within itself.

Lots of companies offer random rewards in the form of mystery boxes. Woot.com’s most coveted item is something titled ‘Bag of Crap,’ which is literally just whatever they want to send you. There are blog posts talking about the best strategies to obtain the Bag of Crap, as it is really hard to get.

In addition to the core drives mentioned in Fixed Action Rewards, Random Rewards add the core drive Unpredictability & Curiosity (Core Drive #7), which is an excellent way to surprise and delight your customers and engage them to become deeper fans of your offering.

Gamification Reward #3: Sudden Rewards (Easter Eggs)

Another way to spice up your marketing promotions is by using Sudden Rewards, also known as Easter Eggs (Game Technique #30). Sudden Rewards are rewards that are not advertised and that the customer doesn’t expect to get for taking a specific action.

In contrast, Random Rewards are unexpected rewards based on a certain expected Trigger, while Sudden Rewards are based on unexpected Triggers.

Participants love the element of surprise and the bonus feeling of excitement and luck because the reward was unexpected. Sudden rewards incentivize customers because they feel extra happy after receiving them, encouraging them to keep coming back in hopes of feeling happy again.

Sudden rewards work in two ways:

• They get great word-of-mouth because everybody loves to share something exciting that happened to them that day. They’ll tell their friends about what they got and their friends will want to participate in the hopes that they’ll get an Easter egg as well.
• They can also cause speculation if done correctly. If the sudden rewards seem random, participants will wonder how they can replicate the experience to hack the system. They will start to develop theories about why they won, and other participants will be interested in testing these theories to either prove or disprove that the Easter Egg is real.

The ‘Chase Picks up the Tab’ campaign is a great example of a Sudden Reward. When you swipe with your Chase card, there is a small chance that you will receive a text saying, ‘Chase just picked up your tab. The $5 will be credited back to your account!’

Once someone wins, they want to swipe more often because they might win again, and they tell their friends about it. Their friends might even sign up so they can play this ‘game’ too.

Sudden Rewards use the Core Drives Unpredictability & Curiosity (Core Drive #7), Epic Meaning & Calling (Core Drive #1) — the ‘calling’ part, Ownership & Possession (Core Drive #4), and could cause Empowerment of Creativity & Feedback (Core Drive #3) — guessing and testing how to replicate that experience — as well as inspire Social Influence & Relatedness (Core Drive #5).

Gamification Reward #4: Rolling Rewards (Lottery)

The next type of reward is the Rolling Reward, or Lottery (Game Technique #74). Rolling rewards are given to a select number of winners by chance after they take a specific action, like purchasing a lottery ticket or entering a contest.

The key idea of rolling rewards revolves around the rule that someone has to win each time, so the longer you ‘stay in the game,’ the higher your chances of winning.

Typically, rolling rewards have low barriers to entry, attracting a large number of participants. If a participant wins, they may become a lifelong fan, feeling chosen to win — the ‘calling’ part of Epic Meaning & Calling.

Winners are further incentivized because they are promoted in the media, and their story becomes one of success, inspiring others to participate in the next lottery or sweepstakes.

Rolling Rewards use the Core Drives Unpredictability & Curiosity (#7), Epic Meaning & Calling (#1), Development & Accomplishment (#2), Ownership & Possession (#4), Social Influence & Relatedness (#5), and Scarcity & Impatience (#6). No wonder sweepstake systems work well in marketing.

Gamification Reward #5: Social Treasure (Gifting)

Social Treasures (Game Technique #63) are rewards given to you by friends. You can’t buy them or earn them; you can only receive them if someone else gives them to you.

Social treasures help companies spread word-of-mouth because they require friends’ involvement.

A past example is the Goat everyone wanted in Farmville. They couldn’t buy the goat with time or money, but a friend could create it. A more recent example is the Candy Crush ‘life.’ Ever received those Social Treasure requests?

Companies often provide rewards through referral fees or friend discounts, like when your cable or cell phone company offers you $50 for getting a family member to sign up. They aim to spread the word about their brand through recommendations.

Social Treasures use the Core Drives Social Influence & Relatedness (#5), Ownership & Possession (#4), Scarcity & Impatience (#6), and Empowerment of Creativity & Feedback (#3) — as people figure out how to get their friends to provide the Social Treasure.

Gamification Reward #6: Prize Pacing (Collection Set)

The sixth type of reward is Prize Pacing (Game Technique #16), which are rewards given out little by little. Participants must collect all the pieces to earn their reward.

This is an excellent option for a company as it doesn’t need to give out tangible rewards to everyone while engaging participants once they collect a few pieces needed to receive a tangible reward.

In Christmas 2012, a Midwest grocery chain called Jewel-Osco created a sweepstakes that used Prize Pacing by offering game pieces in a variety of categories. These game pieces could be collected and redeemed once a participant had all the pieces for one category.

Each category had a different prize, and people received game pieces based on their purchases. Every $10 spent earned a game piece, and participants kept track of their collections on a game board.

This campaign implemented a McDonald’s Monopoly-style sweepstakes, increasing customer purchases. Instead of running to a local gas station for snacks, customers made longer trips to Jewel-Osco to grab extra game pieces.

Prize Pacing heavily uses the Core Drives Ownership & Possession (#4), Scarcity & Impatience (#6), Development & Accomplishment (#2), Loss & Avoidance (#8) — don’t want to waste collected parts, Unpredictability & Curiosity (#7), and inspires Social Influence & Relatedness (#5) when people start trading pieces.

Conclusion

Now that you know about the six types of rewards, think of ways to implement them both individually and in combination within your organization.

Rewards can enhance any experience, and the more types you consider for your marketing strategy, the better the final design will become.

Related Reading

• The Octalysis Framework for Gamification & Behavioral Design
• The Earned Lunch: Fixed Action Rewards
• Decoding the Mystery Box
• The Spinning Wheel: Boosting User Engagement
• Collection Sets: Game Design Technique
• How Rewards Kill Our Creativity

WOULD YOU LIKE YU-KAI CHOU TO WORK WITH YOUR ORGANIZATION?