Fun Shopping: A Randomized Field Experiment on Gamification

Spotlight

Gamification is an emerging digital strategy to engage users across different business domains. Gamification, defined as using game-design elements in nongaming contexts, shows great potential across domains such as education, business, and health. The significance of gamification is highlighted by a $7.17 billion global market in 2019 and is projected to reach more than $40 billion by 2024. This study examines two popular badges and leaderboards that utilize self-determination and social-comparison mechanisms to promote user engagement. We conduct a randomized field experiment (A/B testing) to quantify these effects in one of the largest shopping malls in Asia and further contrast the two games against coupons regarding various shopping outcomes. Quantitatively, badging and leaderboarding promote sales by 21.5% and 22.5% in the treatment period, respectively, whereas couponing delivers a more potent effect of 31.7%. In the posttreatment period, the gamification impacts remain significant, whereas the influence of couponing fades out. Besides, the additional analyses document the salient heterogeneous treatment effects across gender, age, and income. We also zoom in on the contrast between badges and leaderboards, showing that badging is a balanced tool for attracting the general public and leaderboarding is a double-edged sword that could encourage self-reinforcing or self-banishing. Finally, gamification encourages consumers to do more exploration, leading to significant increases in sales.