It’s not news that salespeople don’t like to show their work. Customer relationship management (CRM) systems were designed to not only collect and mine customer data, but also let CFOs and other executives keep a closer eye on their enigmatic sellers.
But there’s a problem with CRM systems: many salespeople don’t want to take the time to use them. According to research group Forrester, roughly half of CRM implementations do not provide the value they promised because users do not input adequate data. Furthermore, analysts estimate that businesses deploying CRM systems miss out on 10% of potential revenue because of poor sales-performance management.
“The use of CRM apps is important to the whole sales process, but if salespeople aren’t using the technology, the ability to leverage the technology to generate deals is greatly diminished,” says Carter Lusher, chief analyst of enterprise applications and solutions at Ovum Consulting. “Salespeople, though, are incredibly competitive. And if you add a layer of social competitiveness to a CRM application, it gets their attention.”
Enter gamification. That, as defined by Gartner, is the use of game mechanics in nonentertainment environments to change user behavior and drive engagement. Providing salespeople with incentives to drive their performance is nothing new. But taking their natural tendency toward competitiveness and exploiting it to drive CRM engagement is. The idea is that adding a gamification layer to a company’s existing CRM system will increase productivity while also providing the higher-ups with a more accurate view of what their sales staffers are doing and how their customers are feeling.
“CFOs are highly concerned about revenues and how they affect topline growth, so they want CRM systems to be more effective, and gamification can help salespeople engage in [those systems] more effectively,” says Lusher.
Kris Duggan, CEO of gamification software provider Badgeville, says he saw the need for better employee engagement in CRMs while working for community-platform software company Socialtext. “Companies don’t always get the desired ROI out of their CRM systems because users don’t want to go in and do this extra work, or the data’s not clean, or they’re not updating it,” he says. “Management can buy the software, but if they don’t get employees to use it, it’s useless.”
Badgeville For Salesforce, the company’s CRM gamification app, was launched earlier this month. The “game” has users (salespeople) starting out as low-level squirrel hunters who, by inputting data, managing leads, and converting those leads to new business, gradually rise up the ranks, eventually becoming top-level whale hunters. In the process, they’re using the CRM the way it was meant to be used. “We’re trying to get them to do the pieces of their job we know they need to do to be successful,” says Duggan.
Using Badgeville’s app, or a similar one like Bunchball or Level 11, all of which can be found on the Salesforce AppExchange, game administrators are taken through a step-by-step process that lets them customize the game mechanics. Those include the tasks and assignments they want to attach to the game’s achievements, points, levels, and missions, and how often they want their users to be able to “level up,” or collect rewards, in the form of badges. Rewards can be refreshed on a monthly or quarterly basis.
In return, believes Ron Fior, CFO of cloud-software provider CallidusCloud, sales reps are more apt to do a better job. “It’s all ego,” he says. “The best salespeople make a lot of money, but there’s a point where they’re saying, ‘Money isn’t everything; I want some recognition.’”
Because gamification software can be used through multiple channels (mobile apps, web sites, and enterprise applications), most organizations would not have to radically change their existing technologies in order to accommodate the software. And many gamification apps have built-in analytics to determine software’s effectiveness in changing employee behavior. Employees are technically not required to participate in the game, but administrators (read: bosses) can view who is participating and who isn’t, so it’s the employee’s choice to risk not playing. Transparency: music to a CFO’s ears.
“A CFO wants visibility,” says Lusher. “It doesn’t matter if it’s a public or private company, they hate surprises. And if the sales organization is not doing an effective job of capturing data, then guess what? There is nothing but surprises.”
Fior says he considers the leader boards that are the primary behavior-driving factor in many gamification offerings to be a highlight of gamification as a visibility tool.
“I can see on the dashboard the top sales reps, bottom ones, and everything in between,” he says. “If you have a scoreboard, and there are 10 people on it, you know the one on the bottom doesn’t want to be there, and he’s going to work to get to the top or the middle. Taking those habits and the way people react, if you keep the competition going, it’s going to drive more revenue.”
CRM gamification, it seems, would be perfect for Y-generation employees who some believe may have trouble staying off Facebook and on task. Indeed, Duggan says that’s who he thought of when developing Badgeville. “If you’ve got a younger-generation workforce, you can figure they’re just going to go off and play on Facebook and Farmville, so why not get them to boost sales productivity by bringing that to them?”
But Lusher warns of thinking too narrow-mindedly about the technology. “I think more and more of us of all ages are being exposed to game mechanics, and we don’t necessarily know it,” he says. “And frankly, because salespeople are so competitive, it’s not just about younger members.” Getting older workers to adopt new technology in order to use CRM software properly is sometimes harder than doing so with younger workers who are more comfortable with technology, he says. “The key is finding specific employee behaviors that need to be changed, applying [game] mechanics, and getting everyone in the habit of using the technology.”
And what about skeptical CFOs still not convinced gamification is anything more than a gimmick? Currently between 500 and 1,000 enterprises have begun using gamification methods in some way, Lusher says. The number of companies using it specifically in their CRM systems is much smaller.
“We’re in the very early stages of early adoption,” says Lusher. “This isn’t something that’s easy to explain with words. It’s about crossing the chasm. Until somebody experiences it for [himself] or sees someone else benefit from it, [he has] trouble visualizing.”
A company may not need to invest in gamification solutions if there’s no employee-engagement problem to be solved, Lusher acknowledges. But, he contends, with little up-front cost and minimal risk to employ such products, any enterprise looking to increase the value of its CRMs should consider giving them a shot.
In May, CallidusCloud announced a partnership with Badgeville to produce MySalesGame, which digitizes the traditional incentive-driven culture of sales. Employees earn points by closing deals in MySalesGame, which are displayed on a companywide scoreboard that lets salespeople earn bragging rights while also providing executives with a clear view of each employee’s performance. As a bonus, employees can cash in the points to obtain actual rewards like, say, a gold watch. CallidusCloud began rolling out the game internally this month, so Fior couldn’t yet speak to its effectiveness.
“I look at it as another sexy tool,” he says. “Any tool that I can get that’s going to help me make predictions with more certainty, whether it’s revenue or anything, has value, and the ones that draw human actions and take advantage of human nature are going to have a higher probability of success.”