Clever Geek Handbook
3 September 2025

Mastering Organizational Knowledge Flow

Recommendation

The market offers numerous books on knowledge management, but this manual provides a refreshing change. Far too many of its competitors share the conceptual weaknesses author Frank Leistner warns against: They treat knowledge as if it were the same as information, and they take refuge in abstraction, rather than addressing the complex human challenges inherent to knowledge transfer. Leistner draws on his own experience with ToolPool, a knowledge-sharing initiative at SAS, and uses it to provide concrete examples. He proves pragmatic and realistic about the challenges involved, and he offers specific suggestions. BooksInShort recommends his book to anyone interested in innovation or corporate culture, as well as to managers who are developing learning organizations or guiding knowledge management initiatives.

Take-Aways

  • Knowledge and information are different: Knowledge involves human engagement.
  • Knowledge is internal to one person and must be converted to information to be shared.
  • You can’t manage knowledge, but you can facilitate knowledge transfer.
  • Culture and people comprise 70% of knowledge flow management; process is 20% and technology, 10%.
  • Knowledge flow management needs organizational champions.
  • It also requires the support of all relevant departments, notably information technology, human resources, communications, marketing and finance.
  • When initiating knowledge flow management, take one step at a time, and make sure each step is part of a larger strategy.
  • Measure your efforts conservatively and share the results widely.
  • Knowledge flows more readily if you remove the impeding barriers, like a lack of awareness or institutional support.
  • To facilitate knowledge flow, build a culture of trust.

Summary

Knowledge Flow, Not Knowledge Management

Many organizations deal with knowledge badly. They duplicate efforts and miss opportunities due to ignorance or, even more destructively, because someone in the organization had a valuable idea that never got shared. Why does this happen, not once in a while, but all the time? First, many people confuse the key concept of “knowledge,” using the term interchangeably with “information.” Information can be recorded and transferred. Knowledge cannot. Knowledge depends on the presence of an active mind. Knowledge exists when you connect information to past experiences. Knowledge “cannot be managed.” Therefore, the common term “knowledge management” contains a built-in misconception. That encourages people to make up definitions of the term to include whatever they want or need to address. Thus, they approach knowledge in dysfunctional ways.

“Knowledge is connected to all prior experiences and exists only in the context of the mind. It cannot be managed.”

Because knowledge exists only “in the context of the mind,” it “is actually tacit (implicit) by nature.” This means that knowledge cannot be externalized. Instead, spreading it requires multiple conversion processes. Knowledge must be converted to information, which can be shared. That is, a person who has knowledge changes it to information to share it. Another person then converts that information back to knowledge in his or her head. The human element is the conduit of this complex process.

“You must fully understand that knowledge is in people’s heads and that you cannot succeed by trying to get it out of their heads and store it in some database.”

The term “Knowledge Management,” or KM, is so widely used that getting rid of it is probably impossible; “Knowledge Flow” would be more accurate. Knowledge management often is inaccurately defined as “people plus technology.” To complete the equation, add “process” along with “culture,” and redistribution of effort and energies. People and culture “account for about 70%” of good knowledge flow. Process makes up another 20%, and technology, 10%. Those who discuss knowledge only in terms of technological systems or databases usually reveal that they don’t understand its true nature.

How to Start Your “Knowledge Flow Initiative”

Successful “knowledge flow management” can take radically different forms, from Toyota’s production system, which gives workers autonomy and responsibility, to Wikipedia, with its ever-evolving online mass collaboration. Managing knowledge flow requires “a holistic approach.” People – not technological issues – are your greatest challenge when you change your knowledge flow, because you are creating an ongoing shift in your firm’s culture. You’ll need to change how people act, which is more difficult than implementing new technology. Start your knowledge flow management undertaking by making a distinction: This is a knowledge flow “initiative,” not a “knowledge management project.” Projects have a definite finish; initiatives are open-ended.

“Knowledge flow management is largely about driving human behavior, which takes considerably more time than a pure information technology project.”

Decide who will lead the initiative, whether to start slowly or quickly, and how to structure your teams. External experts can help you begin, but you should have in-house experts in place by the time you expect the initiative to be self-sustaining. Grant teams within your firm the capacity to reach beyond the company’s borders to access any needed expertise. Starting in smaller, “modular” steps works well because that lets you produce small successes early. Make sure those modules later can become part of larger, “intelligently networked systems.”

“A knowledge flow lives and dies with participation.”

Knowledge flow management affects several different areas of a business. Enlist the heads of human resources (to support learning), information technology (to support the technology), finance (to recognize knowledge’s role in innovation), and “internal communications” and marketing (to publicize your initiative). Promote knowledge flow by increasing interaction with customers and seeking out “knowledge intermediaries” within your company. These intermediaries might be “knowledge brokers,” who help individuals connect; “knowledge stewards,” who help organize and store knowledge; or “knowledge researchers,” who unearth new knowledge. Good knowledge intermediaries love sharing knowledge, have an intuitive grasp of who and what to connect, and can integrate information from multiple sources. Support them by linking their tasks to formal job descriptions and by rewarding them.

What Do You Need to Succeed?

To establish a successful knowledge flow initiative, you need “passionate” executive supporters to champion your cause. These “drivers” should want to be involved, communicate well, have experience in multiple cultures and fields, know how to inspire and be committed to knowledge flow management. Some must be leaders who can inform your organization about its progress, “celebrate milestones,” tell stories that transmit complex messages about knowledge flow management and, finally, demonstrate how to share knowledge. Such leaders help your corporate culture become more conducive to knowledge flow. They need to understand that knowledge resides in people. These leaders must endorse your initiative directly and integrate knowledge flow management into communication from the organization’s top levels.

“Giving your initiative a clear brand is important.”

Your business model is part of your culture, along with how your organization responds to questions and what level of trust you’ve developed. People need to feel safe to ask questions and share knowledge. They need to know that they’ll gain “reciprocal value.” Help build trust around knowledge sharing by increasing the level of “personal interaction.” An anonymous email asking someone to contribute will garner little trust. But if you call an individual – especially if you call while looking at his or her picture in the company’s phone book – that builds considerable trust. Direct personal interaction is always best.

“Like any repository, [knowledge bases] usually are only as good as the content that they contain.”

Too often, companies devoting resources to persuasive messages for the outside world fail to spend money and attention on internal messages. Don’t make that mistake. Brand your initiative, and find ways to mark your employees’ involvement. SAS, for example, gave small pins to ToolPool contributors. Publicize your initiative. Share milestones, such as birthdays, and set symbolic success markers, such as the thousandth download. Use “existing channels” to reach out, but add “new channels” for fresh audiences. Keep your initiative as simple as possible. Don’t anchor it to any specific “business process” or technology. Invest heavily in support of new technology: Allocate “at least 50 cents” of support for every dollar of your initial investment, and a bit more for training.

“Even with Web 2.0, the technology is only the enabler. The power is with the people, decentralized, direct, and often ending in a person-to-person exchange.”

Improve knowledge flow by thinking of your databases as “repository of pointers”: Your staffers can access the database to learn and to find people who know more about the topic. “Communities of practice” enable strong knowledge flow, and technological tools enable them. “Open Space Technology” and more formal “knowledge transfer sessions” can support such communities by providing opportunities for discussions.

Barriers to Knowledge Flow

Individuals may resist your knowledge flow management initiative. Some of this resistance derives from employees thinking no one cares about their in-process problems, or they don’t want to share the tools they’re honing because they don’t think those tools are ready for scrutiny. Avoid letting developers add substandard work to an initiative just so they can say they’ve contributed, and realize that too much polishing can result in perfect tools that are developed too late for the problem they were created to solve, or in tools so elaborate that they’re hard to learn. People resist taking part in knowledge transfer for several common reasons. Eliminate these barriers to help knowledge flow more freely in your organization:

  • No time/low priority – Employees will say they don’t have time to take part in your knowledge initiative. That really means they don’t understand why it should be a priority. Make sure staffers know why this matters and have time to contribute.
  • Lack of awareness – Sometimes workers don’t know that sharing knowledge is part of their job. Eventually, your workers will reach a stage where they share knowledge habitually, but early on, they will need education.
  • No sense of value – People take things they know for granted. They devalue what they do, and the solutions they’ve generated, and don’t think anyone else would benefit. To help people value their knowledge, “create transparency.” Building knowledge flow into job descriptions and performance reviews also helps.
  • “Knowledge is power” – The belief that knowledge is power, that it must be held tightly or even kept secret, is common and has sound historical justification. But today knowledge becomes outdated so quickly that clinging to it means holding onto the past. You learn and advance by sharing knowledge.
  • Knowledge sharing is hard – Some managers tell employees to share knowledge, but the supervisors then fail to allocate resources to support the process. That won’t work. Sharing knowledge takes time and effort, so provide both. Some participants want to share only “the highest-quality knowledge,” but that leads to perfectionism and delay.
  • Lack of institutional support – Knowledge flow will suffer if you divide your organization into rigid units. Success requires the right technology, sponsored knowledge sharing sessions, and a culture that fosters trust and information sharing.

Measuring Your Efforts

Given the complexity of knowledge flow, and the fact that knowledge always involves individual internal thinking, you may believe it cannot be measured. However, measurement is central to management, and some metrics are useful. Take all measures as “approximate,” and use them conservatively. You can’t directly measure knowledge creation or flow, but you can measure two broad, indicative categories: “contribution numbers” and “usage numbers.” A team’s contribution to the volume of your knowledge base is only a positive factor if the entries are of high quality. Know the source of your contributions. A department or team that submits fewer contributions than other teams is either underperforming or encountering barriers to knowledge flow.

“The one key success factor for a knowledge flow management initiative that is above all others is passionate support.”

Keep usage measurements simple and cheap. You can’t completely track how someone uses a knowledge entry or what that use means over time. However, you can track related factors, such as the number of times users download specific items. Share average contribution numbers and usage tallies with your organization. These statistics let people know their contributions are utilized and produce a sense of value and belonging.

“Many organizations still struggle to make best use of the knowledge that exists in them.”

Conduct surveys to estimate how many people use a tool after they download it. Combine that with conservative estimates of the time they saved by using that tool to produce quantitative estimates of savings. Build evaluations of “knowledge-sharing behavior” into performance evaluations. Track how much individual units participate in your initiative and how involved your “institutional experts” are in knowledge-sharing activities. Develop organizationally specific metrics for participation, contribution quality, time or money saved, and cultural openness to knowledge sharing. Don’t overwhelm your firm with surveys, but, after a major change (such as move or reorganization), try a questionnaire to see how the change affected components of your knowledge-sharing outreach (such as frequency of peer contact). Share the results with your company.

Looking Forward

Using Web 2.0 and even Web 3.0 innovations – and any other technological upgrades – won’t change these core principles. Knowledge flow depends on active participation, so these new tools’ emphasis on user involvement enables further knowledge sharing. Some, such as community blogs and wikis, are already well known. Others, such as new search technologies, offer great potential in promoting knowledge flow.

“Never forget the human element of knowledge flow management.”

You may find social media useful within your organization (rather than just outside of it). Your organization has a much smaller population than the Web at large, so you’ll need to exercise active leadership to get a higher percentage of your company’s population involved. Expect the nature of that involvement to shift somewhat; younger workers are more at ease with online interaction and they take it for granted. Their increased involvement may reduce the need for face-to-face interaction to facilitate knowledge sharing. As people grow more aware of how crucial knowledge flow is to their organizations, specialized positions will emerge to support it.

About the Author

Frank Leistner is Chief Knowledge Officer at SAS Institute. He originally developed computer operating systems, then moved to developing end-user software in 1993. Since 1997 he has been leading knowledge management initiatives at SAS.

Read summary...
Mastering Organizational Knowledge Flow

Book Mastering Organizational Knowledge Flow

How to Make Knowledge Sharing Work (Wiley and SAS Business Series)

Wiley,
 


3 September 2025

Build a Brand in 30 Days

Recommendation

Self-proclaimed “brand guru” Simon Middleton explains in clear, easy-to-understand terms what branding is, and then he tells you how to do it in this systematic guide to do-it-yourself branding. Even though he writes for small-business owners and entrepreneurs, Middleton’s process applies to large businesses and corporations as well. He makes his subject so enjoyable and even inspiring that reading his guide is like having a conversation with a witty, knowledgeable and helpful friend. However, Middleton ambitiously proposes that you undertake a different branding activity each day for a month. But even if you decide to stretch the 30 days to three months or more, he does explain how to get the job done. And it costs a lot less than hiring an agency or consultant. BooksInShort recommends Middleton’s advice, if not the exact timing of his process.

Take-Aways

  • Your brand is the image your product or service has in the minds of your customers.
  • Strong brands are “compelling, authentic and relevant.”
  • Your business must be profitable, but money is not your only motivation. Connect your deeper purpose to your brand.
  • People buy a brand when it aligns and connects with their needs and feelings. Branding is an emotional process. Your values humanize your business.
  • The “Morphological Analysis” – a grid you can set up to clarify your brand’s traits – can help you formulate your branding strategy.
  • Identify your target market and learn about your audience.
  • To differentiate your firm in the customer’s mind, you need to know your competition’s strengths and weaknesses as well as your own.
  • Positioning determines how people think of your brands relative to other similar brands.
  • Position your brand against the weaknesses of your competitors’ brands.
  • Your staff will become brand ambassadors if you talk to them, listen to them, and “empower and respect” them.

Summary

Basic Branding

To develop and implement a branding strategy, you must understand what branding is and is not. Branding is often confused with marketing, advertising or even logos. But branding isn’t part of a marketing strategy, and it isn’t just your slogan. Your brand is the image of your product or service in the minds of your customers. It is “all the meanings that all your possible audiences carry around about you in their heads and in their hearts.”

“If starting a business is challenging, then creating a brand is more so.”

John Lewis is a British department store. When they hear its name, people who are familiar with the brand associate it with “quality, service, value, partnership” and the “middle class.” Even though its customers come from a variety of backgrounds, they all distill the same meanings from the brand. The Nike swoosh also evokes a shared set of associations, including “achievement, sport...fashion, quality...high-profile sponsorships.” Nike’s brand creates an aura and personality Nike cannot achieve through its products alone.

Why Brand?

Consumers don’t base all their purchasing decisions on analyzing features and benefits. Often they rely on their emotional connection with a brand. Whether they are purchasing a car or a cup of coffee, a brand association with a set of meanings streamlines their buying decisions and turns them into repeat customers. Without a brand, your product is merely a commodity. People patronize your brand because it aligns somehow with their needs and feelings.

“We buy not with our rationality and our intellect, but with our eyes, noses, hands and hearts.”

Connect the concept of branding with a deeper meaning by considering two brands you like. Write down five ways you find their meaning significant. Then compose a list of the meanings of your firm’s brand. Strong brands share certain traits. For instance, they are “compelling, authentic and relevant.” The members of your target market, be it a neighborhood group or a national constituency, know the brand and associate it with similar connotations. They recall its name, logo and slogan. A well-branded business doesn’t have to constantly explain itself.

“Brand is a kind of shorthand.”

Strength is not the only characteristic that determines a brand’s image. The public may widely recognize and understand your brand, but it could still evoke negative associations. Consider North Korea and South Korea. You may have similar perceptions of both, but your image of South Korea is likely more positive. People may talk about brands with negative images, but those brands enjoy little repeat business and their advertising rings false. But when a brand has a positive image, the public gives it generous free buzz, peer-to-peer recommendations, repeat business and upbeat feedback.

Purpose and Strategy

Money may have motivated you to build a business, but it doesn’t wield the same power as purpose. Discern the inner meaning that fuels your business and make it the basis of your branding. People respond to brands that speak to a facet of their humanity. Connecting with your emotions and understanding your goals will help you develop your brand. Branding is an emotional process, but running a business is not about emotion alone. Strategy also plays an important role. A well-defined strategy acts as a compass when things are moving forward and when you hit roadblocks. Strategy identifies your ultimate goal. Don’t confuse strategy with tactics, which are the methods you employ to achieve the results you want.

“Building a brand is absolutely as much an act of the imagination as it is a rational process.”

Your strategy should call upon the skills you have or can develop, and what jobs you need to delegate or assign to outside resources. While you may enjoy balancing the books, for example, perhaps you lack the design skills required to set up an appealing window display. In this case, you could function as your own bookkeeper but hire an employee with creative talent.

“We respond to the best brands because they capture some aspect of our humanity and reflect it back to us.”

“Morphological Analysis” A Morphological Analysis (MA) can help you create the basics of a brand strategy and understand the qualities of your business that you can brand. Create a grid with four columns and eight rows. Say, for example, that you want to open a coffee house. Head each of the four columns with one aspect of that task, such as “location, style, customer type and business emphasis.” In each of the eight rows, write possible options for each heading. For instance, under location, you could include “mall, city precinct, business district, sidestreet, mobile van, college campus, village” and “seaside.” Once you complete your grid, consider all the various permutations. Determine which ones resonate with your original idea, offer new possibilities or connect to you emotionally. Decide which combination of options you want to explore further.

“Brands, like people, are unique: or at least they should be if they want to succeed.”

Your values humanize your business. However, labeling yourself as honest or reliable doesn’t mean much because such values are too broad and all businesses claim them. To define meaningful values for your brand, create a new MA grid of any size and write one value that matters to you in each box. Analyze each value’s applicability to your brand to see if it is “genuine,” “compelling internally,” meaningful to consumers, unique to your business and easy to communicate. Ask yourself if you “would fight to preserve this value.”

Understand Your Competition

Any product or service will have competitors. Don’t be intimidated; be knowledgeable. Assess your competition locally, nationally and globally. Pinpoint its strengths, and think about how you might deliver a better brand experience. Look for elements that consumers associate with the competing brand, and consider how your brand is different.

Know Your Market

Identify your target market. Remember that you can’t be all things to all people. Trying to please everyone only brings a loss of brand specificity and focus. Define the customer you don’t want to target. For example, if you run a bed and breakfast inn, you may not want customers who demand 24-hour room service, insist on having pets in their rooms or expect cable television.

Analyze Your Brand

The exercise nicknamed “the six-leg spider” will help you better analyze your brand. Draw a circle in the middle of a large piece of paper, with six lines radiating from the center. Label and complete each line by answering these questions:

  • “Product/benefit” – What is your product or service? How does it benefit customers?
  • “Desired positioning” – How do customers perceive your brand relative to your competition’s brand?
  • “Style” – How does your brand interact and connect with your customers?
  • “Mission” – What is the purpose behind your product or service?
  • “Vision of the future” – Where do you want to be in the long term?
  • “Values” – What are your company’s values? Which values did your MA isolate?

Positioning

Positioning refers to “the space your brand occupies in the hearts and minds of your audience relative to comparable brands.” Imagine you own a bike shop that sells high-end cycles. Down the street is a sports store that sells bikes and other sports equipment. Instead of thinking of that store as a competitor that is siphoning off your business, position your store in relation to it. You have high-end merchandise while it sells knockoffs. Your staff is knowledgeable; the other store’s employees are generalists. Your customers are passionate cyclists, not weekenders.

“Bland values are as worthless as no values at all.”

Create a concise positioning statement for internal use that defines your brand’s strengths and goals. Outline the methods you can use to achieve those goals and what your brand means to your customers. Include a positioning line in your ads to crystallize your brand image, such as your product’s slogan, like Nike’s “Just do it” or Budweiser’s “King of Beers.” Keep your slogan short, simple and authentic. Avoid puns and foreign languages. Write several possible taglines, check for spelling and grammar, and test them on a sample audience before making a decision.

Advertising Basics

Marketing and advertising are not interchangeable. Marketing includes the activities that bring your product or service to market. Advertising is paid space in the media. When you create a print ad, radio spot or television commercial, you control the message. Media relations is a broad term that often includes public relations efforts. You might not pay for PR, but you also don’t control its message. However, a story in the press carries more credibility than paid advertising.

“Running a business and building a brand are not activities for the easily hurt.”

Publications, broadcasts and websites rely on press releases and media packages for content. A typical media package, which you send via email, includes:

  • A cover letter introducing your product.
  • A description of your product or its recent newsworthy aspect or activity.
  • Background details, including several high-quality photographs.
  • Your full contact information.
“Entrepreneurship is a kind of spirit, a state of mind, perhaps even a personality type.”

For press releases, sum up your main point in a three- or four-word headline, write a short first paragraph with the gist of your message and then add any other pertinent material. Almost no one reads press releases all the way through, so put the essential information at the top.

Ad Creation

Creating effective ads is a skill many small-business owners lack. Knowing what pitfalls to avoid will help you spend your budget efficiently. To determine the main objective of your advertising, decide whether you want to build awareness, generate sales or clarify your positioning. Be clear about your target audience. Identify the geographic area where they live, as well as their priorities for products and services. Find out which media they use most often, and purchase advertising that aligns with their whereabouts and interests. You may want to contract with advertising professionals to write and design your ads or make your media buys.

“It takes courage, not money, to use the power of imagination in your brand.”

A web presence is mandatory. Your brand’s website should be visually engaging, accessible, informative, compelling, current, interactive and better than your competitor’s. Consider displaying your brand on other sites and online marketplaces, such as eBay. Study search engine optimization so that you know how to manipulate your website to try to earn a higher rank in online search results. Establish a social media presence through networking sites such as Facebook, Twitter and YouTube.

Image, Inside and Out

Everything you do either reinforces or negates your brand image. You interact with customers through a variety of vehicles called “touch-points,” which make people feel as if they’re having either a positive experience – thus enhancing how they react to your brand – or a negative experience, which accomplishes the reverse. Rate how well your brand performs in “general communication, online experience, packaging, branch experience, follow-up experience” and in handling complaints.

“The brutal truth is that nobody (honestly, nobody) cares about your brand as much as you do.”

Your want your employees to become fervent supporters of your brand since they represent it, so communicating effectively with them is as important as communicating with your customers. Follow four general guidelines to encourage your team to support your firm's brand strategy:

  1. “Talk” – Reach out to employees in good faith and with enthusiasm.
  2. “Listen” – Seek out and pay attention to what your employees think and feel.
  3. “Empower” – Make your employees understand what your brand means to you.
  4. “Respect” – Always honor your employees’ ideas and emotions.

About the Author

Simon Middleton founded The Brand Strategy Guru. He hosts The Brand Effect on British television.

Read summary...
Build a Brand in 30 Days

Book Build a Brand in 30 Days

Capstone,
 


3 September 2025

Game-Based Marketing

Recommendation

People play games – online, on phones, on game consoles – everywhere. Industry expert Gabe Zichermann, in collaboration with pop culture writer Joselin Linder, tells you how to engage your customers through interactive game play and take advantage of this growing trend. While Zichermann’s book gives readers a head start on exploring game-related marketing, the author refers to Frequent Flyer Programs, World of Warcraft and even Webkinz, but unfortunately doesn’t explain how they work. Zichermann details the growth of gaming and explores the use of “Funware” – the word he coined for using games in a business context. BooksInShort finds that this invitation to the playground is an appropriate opening move for those interested in adding gaming elements to their marketing mix.

Take-Aways

  • Games are a proven, effective and ever-more pervasive marketing tool.
  • Adding games to your marketing mix will garner loyalty, boost sales and differentiate your brand.
  • People engage in competition daily, even if they don’t view such behavior as game play.
  • “Funware” is the use of games to influence customer behavior and achieve business objectives.
  • Game designers employ “game mechanics” to initiate and facilitate play.
  • Gaming elements include “status and levels, points, rules and demonstrability.”
  • Frequent Flyer Programs (FFPs) have become a successful marriage between gaming and marketing.
  • Airlines are experts at offering “status on display.”
  • “Generation G,” the 20 million Americans born between 1998 and 2000, are growing up with mobile and social technologies.
  • Use games and gaming techniques to motivate and reward employees.

Summary

Why Play?

Traditional advertising is losing effectiveness as competition for consumer attention grows by leaps and bounds. Today’s consumers decide what to listen to and watch by making full use of mute buttons, social networks and pretaping systems. While once-effective advertising methods do not work as well as they used to, game playing is on the rise and vying for your customers’ attention. “To compete with games, marketing must become a game.” By adding gaming elements to your marketing mix, you can harness the power of play to boost your sales.

“The future of marketing is games, and it starts today.”

Since the 1920s, NBC News has amassed an extensive video library. Rather than let those news clips gather dust, TV producer Chris Tiné created a software application called iCue that high schools use to teach history. NBC followed up with What’s Your iCue?, a Facebook trivia game. What’s Your iCue? quickly became a hit, garnering more than 100,000 users each month and becoming a revenue builder for the network. The successful game achieved several objectives for NBC: It created a positive brand image, engendered long-term loyalty and generated revenue.

“People are intrinsically competitive.”

NBC’s trivia game also produced a “sticky” user experience. Stickiness is an Internet metric of loyalty that measures the relationship between the span of time a person spends on a site and the number of his or her annual visits. Social networking sites and multiplayer games enjoy the highest levels of stickiness. With sophisticated application of game play, you can ratchet up your customer engagement and enjoy the benefits NBC experienced with What’s Your iCue?

“All the world’s a game, and savvy marketers can – and do – leverage this fact to create lasting engagement and positive brand connections.”

Frequent Flyer Programs (FFPs) and other loyalty systems prove that gaming and marketing create a happy marriage. Modern FFPs use a number of gaming elements to engender loyalty, including point accumulation, level climbing, rewards and challenges.

People engage in competition on a daily basis, even if they don’t view it as game play. Consider how passengers jockey for position when a train pulls into the station or how some people cut in to grab their order at Starbucks. Marketers use these indicators of human behavior to construct effective games. Some components are essential to all types of play:

  • “Status and levels” – A way to demonstrate success or climb to new challenges.
  • “Points” – A method of keeping track of who is leading.
  • “Rules” – The game structure.
  • “Demonstrability” – The social aspect of indicating who is winning.

“Game Mechanics”

Interactive marketing is on the rise with social media at the forefront. Combining game tactics with social media creates a powerful amalgamation. “Funware,” a marketing term that author Gabe Zichermann coined, is the art of using games and gaming devices to influence customer behavior and achieve expressed business objectives. People enjoy competing, playing games and winning. They also revel in watching other people compete, as demonstrated by the popularity of television game shows. People relish the process of participating in a game, even if the prizes are small, symbolic or virtual. They like to compete against themselves when they’re when not vying against others.

“As products become commoditized, it is loyalty…that keeps people buying.”

Game mechanics are the elements of games that designers use to initiate and facilitate play, such as a scratch card. A “leaderboard” is a game mechanic that posts the names of players and their position within a game, or that tracks the progress of a game. It can spark the desire to participate in or follow a game in a cost-effective way. The “friend count” on an individual’s Facebook profile is an example of a leaderboard, although Facebook doesn’t offer a competitive gaming element to the acquisition of friends.

“The future of Funware and game design in business is breathtaking.”

An example of a simple leaderboard is a sign at a construction site that boasts, “190 Days Since Our Last Accident.” An example of a leaderboard that encourages positive behavior is a gym that posts the names of participants in a weight-loss program and awards points for pounds or percentage of weight loss reduced.

“Social networking…is both marketing’s sickness – and its cure.”

S&H Green Stamps was one of the first and longest-lasting loyalty programs in the United States and a great example of a “point system” in operation. People received stamps when making a purchase, and the stamps were redeemable for merchandise available at Green Stamp stores or by catalog.

“Funware has the power to change employee motivation.”

The points in loyalty programs go by different names such as “coins” or “gold,” but they serve an identical purpose. All point systems have an “earning component” and a “redemption component.” However, you don’t have to offer real-world, physical prizes to make the programs effective. “Virtual currency” can be just as powerful as a motivator. People trade the virtual gold offered by World of Warcraft. Virtual rewards make any point redemption system more cost effective.

“A well-designed game can produce substantial psychological rewards.”

Badges, such as the merit badges that Boy Scouts earn, are a visual display of game achievement. Online, people enjoy competing for and displaying badges on social networking sites such as Facebook. Marketers can influence consumer behavior by using badges to engage players and reward their participation. Marketers also can use the game mechanics of levels and status to influence consumers’ actions. Big, impressive prizes garner media attention, while smaller or virtual prizes engender long-term customer loyalty.

“Games are competing with advertising for consumer attention, and simply placing ads inside popular titles won’t regain your customers’ lost affections.”

Some games require skill to win, while others, like lotteries, rely on chance and luck. Most games of chance require participants to complete a simple act, such as buying a ticket or filling out a form, to qualify for a draw or some similar event at which the organizers choose the winner at random. Slot machines do not require skill and offer payouts at arbitrary cycles. Psychologists call players’ addiction to these types of games “operant conditioning.” People like to win prizes, and marketers can use this premise to reward certain behavior. Game designers have to combat people trying to get around the system.

Frequent Flyer Programs

American Airlines launched the first FFP in 1981, and its overwhelming success inspired other airlines to follow suit quickly. FFPs award points per mile flown, which participants can redeem for airplane tickets or vacations. Users who reach certain travel milestones also receive rewards in the form of travel perquisites such as priority boarding, seat upgrades, discounted hotel rooms and car rentals, and mileage bonuses. Some participants are so enamored with the program and so committed to reaching its milestones that they fly solely to accumulate points. FFPs are a successful tool marketers can use to increase loyalty, influence behavior and differentiate a brand from its competition.

“It’s clear in the world around us that status is a powerful motivator.”

United Airlines offers 1,500 points for first class, business class and full-fare economy class tickets, while discount economy class fares earn only 1,000 points. United thusly structures its reward system because the overwhelming majority of people fly discount economy. By encouraging passengers to pay for just one additional level of points, the airline receives a large revenue increase.

“People have always been obsessed with winning.”

Participants invested in FFPs will exchange their points for the opportunity to earn additional points rather than trading them in for prizes. Many people never get around to cashing in their points. In 2007, close to 10 trillion miles sat unredeemed in FFP accounts. Some participants value status more than actual rewards. Airlines have become experts in offering “status on display.” A look at United’s San Francisco operation bears this out. It features:

  • “A Premier lobby for Elite customers.”
  • “Priority check-in desks and automated kiosks.”
  • “Priority security checkpoints.”
  • “Extra-priority security line ‘jump’ for Global Services Members.”
  • “Red carpet boarding lane for Elite members.”
  • “Boarding announcements made by status order.”
“Only games can cut through the clutter of a crowded brand marketplace and socially networked environment to attract, retain and monetize consumers.”

One concern for marketers was what to do when participants reached the highest level of the FFP, such as becoming a 100,000-mile member. Airlines resolved this by offering new levels, such as “million mile” status, that come with lifetime rewards and benefits.

Types of Players

Richard Bartle, a professor and behaviorist, researched and identified four types of game players:

  1. “Achievers” – These players like to acquire points and earn status. They enjoy the process of playing and want to play well. They like working with others and sharing the joys and defeats of the game.
  2. “Socializers” – These players enjoy the social component of playing games, such as interacting, forming alliances and collaborating.
  3. “Explorers” – These players take pleasure in game playing activities and elements, such as accumulating points or badges, uncovering shortcuts or figuring out puzzles.
  4. “Killers” – These players thrive on competition and have a win-at-all-costs mentality.
“The power of games is growing.”

In addition to Bartle’s four player types, the gaming field also includes the “naïve” players, players who participate unintentionally. They earn frequent flyers points but don’t use them, or accumulate bank rewards that they never redeem. Such players slow game play down unless marketers can capture their attention and convert them into active participants.

“Generation G”

Forget baby boomers and Gen Xers; make way for the 20 million children born between 1998 and 2000; that is, Generation G, the “greatest game playing demographic in history.” This generation is growing up with technology and social networks that previous generations never experienced. Its members interact on social networks and use mobile phones to communicate and play games. Many love Webkinz, a hybrid toy and online game. More than half of these children play video games every day, and some engage for more than 16 hours per week. Girls account for 40% of Gen G game players. “Not since the time of the Vietnam War has such a profound generation gap existed in contemporary society.”

Generation G will not be as open to or susceptible to traditional advertising messages as its predecessors. Its members will demand more interaction and more fun. The brands that use the power of games will make the biggest impression on this tech-savvy generation. Two emerging advertising techniques will grab Gen G’s attention: “advergames,” which promote a specific product, and “in-game advertising,” which is product placement within a game.

Game Incentives

Use games to motivate and reward employees. For example, the highest sellers of Mary Kay products earn the direct marketing firm’s ultimate prize, the pink Cadillac. Mary Kay rewards salespeople using many game-based techniques, such as levels and badges. Companies also can use games to encourage other desired behaviors. For example, a city bus driver may strive to earn and display a “safe driver” badge. Florida’s Medicaid Reform Program uses a credit system to encourage clients to get flu vaccines. People earn points by getting a shot or visiting a doctor, and they redeem their points for health care items. Some districts have achieved 80% participation with these game-based incentive programs.

About the Authors

Gabe Zichermann is CEO of beamME. Joselin Linder wrote The Purity Test and Fake a Death in the Library.

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Game-Based Marketing

Book Game-Based Marketing

Inspire Customer Loyalty Through Rewards, Challenges, and Contests

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