The Boundaries of Gamification for Engaging Customers ... · gamification mechanics operate on CE, which is a widely targetedvariablefor marketingmanagers.SupportedbytheCE-defining

⁎ Corresponding author.E-mail address: [email protected]. (T. Leclercq).

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The Boundaries of Gamification for Engaging Customers:Effects of Losing a Contest in Online Co-creation Communities

Thomas Leclercq a,⁎& Wafa Hammedi b& Ingrid Poncin a

a Université Catholique de Louvain – Louvain School of Management (LSM), CERMA-CCMS, Belgiumb Université de Namur - Faculté des Sciences Économiques, Sociales et de Gestion, CeRCLE-CCMS, Belgium

Abstract

Despite the increasing use of gamification mechanics to engage customers in firms' activities, the risks related to such use remain unclear. Toaddress this knowledge gap, this research examines the impacts of losing a challenge, which is a phenomenon experienced by the majority ofcustomers involved in gamified settings but underexplored in literature. We investigate the context of co-creation communities by combining twowidely used gamification mechanics, competition and cooperation. Results from three laboratory experiments and one field experiment show thatwin/lose decisions weaken the benefits of gamification and, in the case of losing a competition, have negative impacts on customer experience andengagement. They also demonstrate that customers' levels of prior engagement with the community moderate the negative impacts of losing acompetition. Supported by equity theory, this research questions the effectiveness of gamification mechanics, identifies their limits, and providesguidelines on how to properly implement them.© 2018 Direct Marketing Educational Foundation, Inc., dba Marketing EDGE.

Keywords: Gamification; Engagement; Co-creation; Online community

Introduction

In the past two decades, managers and researchers haveincreasingly emphasized that the integration of customers intothe development and promotion of products and services isrelevant to firms' market orientations and relationship manage-ment practices (Hoyer et al. 2010; Norton, Mochon, and Ariely2012; Piller andWalcher 2006; Roberts and Candi 2014; Russo-Spena and Mele 2012; Schreier, Fuchs, and Dahl 2012). Theintegration of customers into company activities enablesmanagers to develop communities around customer interests(Healy and McDonagh 2013), strengthen customer commitmentto new offerings, and stimulate positive customer perceptionsand attitudes (Nishikawa, Schreier, and Ogawa 2013). Suchcustomer involvement boosts adoption rates, ensures continuedproduct usage, and reduces the risk of innovation failure (Hamariand Koivisto 2015; Nambisan and Baron 2007).

The emergence of online platforms, communities, and socialnetworks provides both firms and customers with powerful tools

to support interactions and foster resource exchanges. However,technology itself is not sufficient to engage customers effec-tively, though such engagement is a key predictor of successfulco-creation experiences (Jaakkola and Alexander 2014;Storbacka et al. 2016). Customer engagement (CE) refers tothe level and intensity of the connections that customers developwith focal objects such as brands, communities, activities,platforms, and processes (Brodie et al. 2011). Engagedcustomers are more willing to promote, advocate, collaborate,and share their knowledge. They also tend to develop long-termrelationships with companies (Kumar et al. 2010). Therefore, thegeneration of CE is a key challenge for practitioners that wish toco-create value with their customers (Breidbach, Brodie, andHollebeek 2014; Brodie et al. 2011; Storbacka et al. 2016).Previous research has extensively indicated that firms canfacilitate CE by providing effective interactive platforms.However, more investigation is needed to determine how theseplatforms should be designed to create, manage, and maintainengagement (Breidbach, Kolb, and Srinivasan 2013; Djelassiand Decoopman 2013; Nambisan and Baron 2007; Ostrom et al.2015). This important research gap has been recognized by the

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Marketing Science Institute, which declared CE one of the toptier research priorities for 2014–2016 and again for 2016–2018.

Among the multiple mechanisms that can be implemented todesign interactive platforms, managers and researchers havecalled for the use of gamification (Gartner 2011; Harwood andGarry 2015; Robson et al. 2014). Gamification is “theapplication of lessons from the gaming domain in order tochange stakeholder behavior and outcomes in non-gamesituations” (Robson et al. 2014, p. 352). The practice hasrecently gained attention from practitioners, largely because ithas been emphasized as a promising means to provideenjoyment and thereby generates CE (Robson et al. 2014;Zichermann and Cunningham 2011). Gamification has beenapplied in multiple domains, such as e-commerce (Insley andNunan 2014), healthcare (Drell 2014; Hamari and Koivisto2015), mobile marketing (Hofacker et al. 2016) and intra-organizational management (Farzan and Brusilovsky 2011).

However, recent research has questioned the efficiency ofgamification mechanics. In that respect, potential risks related tothe inappropriate use of gamification mechanics has beenhighlighted such as demotivation, conflicts among participantsor opportunistic behaviors (Hammedi, Leclercq, and Van Riel2017; Leclercq, Poncin, and Hammedi 2017). Consequently,although it is projected to become a widely adopted practice(Gartner 2011), it is still unclear how gamification mechanicsshould be implemented to create, maintain, and manage CE overtime (Harwood and Garry 2015; Lucassen and Jansen 2014).More research is needed to develop best gamification practicesand properly manage gamification tools (Hamari, Koivisto, andSarsa 2014; Lucassen and Jansen 2014; Werbach and Hunter2012). To address these important gaps, we examine the impactof losing a contest. Contest loss is a phenomenon that has beenexperienced by most customers involved in gamified settings,but to date, it has not been well explored by literature.Specifically, we seek to answer the following questions:

• How does losing a contest affect customers' levels ofengagement, according to the gamification mechanics used?

• How do customers' prior levels of engagement moderate theimpacts of losing a contest?

We develop and test a series of hypotheses in three laboratoryexperiments and one field experiment. We conduct the studies inthe context of co-creation communities that combine two widelyused gamification mechanics, that is, competition and cooper-ation. Competition mechanics consist of one participant orgroup winning and the other(s) losing, whereas cooperationmechanics rely on participants collaborating to achieve acommon goal. With cooperation mechanics, all participants arerewarded when one succeeds. Both types of mechanics can beimplemented simultaneously in coopetition settings— a contextwhere competitors cooperate with each other to reach a highervalue creation if compared to the value created withoutcollaboration. In three laboratory experiments, we manipulateboth the gamification mechanics (competition mechanics vs.cooperation mechanics vs. coopetition mechanics vs. controlgroup) and the informing of participants (informed or not

informed that they won or lost the contest). We also distinguishthe impacts of losing from the impacts of winning a contest interms of CE with the co-creation activity. Subsequently, weconduct a field experiment in a co-creation community togeneralize our findings to real settings, test the impact of losing acontest on CE in a co-creation community, and investigate themoderating effect of customers' prior levels of engagement.

The contributions of this research are twofold. First, byresponding to the call of Breidbach, Kolb, and Srinivasan (2013)and Ostrom et al. (2015), we offer a better understanding of howgamification mechanics operate on CE, which is a widelytargeted variable for marketing managers. Supported by the CE-defining premises of Brodie et al. (2011), we empiricallydemonstrate the key role performed by customer experience inthe engagement process. We show that the impact ofgamification mechanics on customers' levels of engagement isfully mediated by their experiences and moderated by their priorlevels of engagement. We distinguish the impacts on engage-ment with the co-creation activity from engagement with thecommunity as suggested by Brodie et al. (2013). Given that thedynamics and iterative nature of CE (Brodie et al. 2011;Storbacka et al. 2016) have been captured by assessing theimpact of gamification over time, we emphasize that the negativeeffects on CE that are induced by losing a competitionmechanicscontest persist, even three months after the experiment.

Second, responding to a recent call from Harwood andGarry (2015), we question the effectiveness of gamification,identify its limits, and provide guidelines on how to implementgamification mechanics properly and deal with cases in whichcustomers lose contests (Hamari et al. 2014; Lucassen andJansen 2014; Werbach and Hunter 2012). We demonstrate thatwin/lose decisions weaken the benefits of gamification.Moreover, based on equity theory (Adams and Freedman1976), we distinguish the impacts of losing a contest accordingto the mechanics used, that is, competition, cooperation, orcoopetition. In cases of lost competitions, the impacts on bothcustomer experience and engagement with a co-creationactivity and the related community are negative. Our resultsalso show that customers who are already highly engaged witha co-creation community are less influenced than newcomersby the loss of a challenge. In this respect, we challengemanagerial practices and call on practitioners to vary thegamification mechanics they apply, according to their cus-tomers' levels of engagement with the community.

In the following section, we survey relevant literaturestreams. Next, in four studies reported in separate sections,we develop and test a series of hypotheses. Finally, we discussour results and outline both managerial implications and futureresearch opportunities.

Theoretical Background

Customer Engagement (CE)

In line with the increasing influence of customers on firms'activities, the concept of CE is receiving considerable attentionfrom scholars as a source of competitive advantages for

84 T. Leclercq et al. / Journal of Interactive Marketing 44 (2018) 82–101

companies (Kumar and Pansari 2016). Specifically, CE refersto the connections customers develop with focal objects such asactivities, communities, brands, or even processes (Brodie et al.2011). It has been identified as a fruitful strategy for growingcompanies' sales and levels of profitability (Bijmolt et al. 2010;Kumar and Pansari 2016). Engaged customers show greaterbrand trust, loyalty, and satisfaction (Jaakkola and Alexander2014; van Doorn et al. 2010). They are more willing tocontribute to firms' activities by taking part in the developmentof new products and services, generating positive word ofmouth, and helping other customers (Chandler and Lusch 2014;Haumann et al. 2015; Hoyer et al. 2010). They also tend toinitiate long-term relationships with the objects with which theyare engaged (Kumar et al. 2010).

Recent works seek to define CE and understand itsassociations with theoretical entities, such as the concept ofvalue co-creation. With their extensive literature analysis,Brodie et al. (2011) define CE as a psychological state thatoccurs through interactive experiences with focal objects. Theauthors describe CE as a dynamic, iterative process ofinteractions that encompass cognitive, emotional, and behav-ioral manifestations (Brodie et al. 2011, 2013). The iterativenature of the process implies that relational concepts such ascommitment, trust, self-brand connection, and loyalty act asantecedents and consequences of CE (Brodie et al. 2011). Withreference to the service-dominant logic, Hollebeek, Srivastava,and Chen (2016) expand this definition of CE to includemotivationally driven investments of operant and operandresources in favor of focal objects. They identify three keyprocesses that occur as a result of the interaction of customerswith focal objects that lead to CE: customer integration ofoperant and operand resources, knowledge sharing, andlearning. Customer resource integration is essential to thedevelopment of CE, whereas customer knowledge sharing andlearning are regarded as antecedents. Combining theseprocesses results in individual and interpersonal operantresource developments and value co-creation (Hollebeek,Srivastava, and Chen 2016; Storbacka et al. 2016). Value co-creation refers to the increase of customer value throughcustomers' interactions and collaborations with other stake-holders (Ranjan and Read 2014; Vargo and Lusch 2016).Without CE, there is no resource integration or sharing and novalue co-creation. Consequently, the concepts of value co-creation and engagement are strongly interrelated (Brodie et al.2011). However, whereas value co-creation is difficult toobserve empirically, CE is observable and thus moredesignable and manageable (Storbacka et al. 2016).

In the digital context, CE offers a fruitful framework forunderstanding how customers and companies interact andexchange resources to co-create value through new technologies(Breidbach, Brodie, and Hollebeek 2014; Breidbach, Kolb, andSrinivasan 2013). Among the online platforms that can be usedto engage customers and co-create value, online co-creationcommunities offer a particularly interesting context; they enablemembers to share information, learn new skills, and co-developsolutions through social interactions (Bullinger et al. 2010;Hollebeek 2011). Within this context, Brodie et al. (2013)

distinguish engagement with a co-creation activity fromengagement with a related community; CE with a co-creationactivity refers to customers' investments of operant and operandresources in projects jointly developed with companies andpeers. Conversely, CE with a co-creation community refers tothe investments in social bonds that customers develop withother community members. Authors have emphasized the role ofinteractive platforms in promoting CE (Bell and Loane 2010;Kaplan and Haenlein 2010; Sawhney, Verona, and Prandelli2005; Sharma and Sheth 2004). Ramaswamy and Gouillart(2010) and Storbacka et al. (2016) even use the term engagementplatform to characterize online interfaces that allow actors tointeract and exchange resources to co-create value. Theseplatforms enable firms to provide beneficiaries with a compel-ling co-creation experience and create, maintain, and developengagement over time (Brodie et al. 2013; Füller, Hutter, andFaullant 2011; Jaakkola and Alexander 2014; Jaakkola,Helkkula, and Aarikka-Stenroos 2015; Kohler, Matzler, andFüller 2009). Practitioners and researchers in turn recommendgamification mechanics as a promising strategy for designingengagement platforms (Werbach and Hunter 2012).

Gamification

The phenomenal success of video games, which areexpected to grow in value from $71.3 billion in 2015 to $90.1billion in 2020 (PWC 2016), has led practitioners andresearchers to invest in studies to better understand whatmakes computer games engaging. They seek to apply theselessons to transform customer routines into fun and enjoyableexperiences (Robson et al. 2015). This process, commonlyreferred to as gamification, represents a highly successful andpopular practice for managers (Werbach and Hunter 2012).Despite having a relatively short history of use, the termgamification has appeared in many managerial books andwebinars dedicated to the topic (Salen and Zimmerman 2004;Swan 2012; Werbach and Hunter 2012; Zichermann andCunningham 2011; Zichermann and Linder 2013).Gamification also has been applied in various managementdomains, such as e-commerce (Insley and Nunan 2014),innovation (Agogué, Levillain and Hooge 2015; Roth,Schneckenberg and Tsai 2015), services (Hamari 2013;Hamari and Koivisto 2015), healthcare (Drell 2013, 2014),banking (Rodrigues and Costa 2016; Rodrigues and Oliveira2016; Rodrigues, Oliveira, and Costa 2016), and intra-organizational management (Farzan and Brusilovsky 2011).

There are two main perspectives on gamification: designerand customer. The designer perspective, summarized mainly byDeterding et al. (2011), refers to “the introduction of gamemechanics and elements (rather than full-fledged games) todesign non-game contexts” (p. 5). According to this widelyadopted definition, gamification consists of game-like mechan-ics, objectives, and structures, introduced by designers toinfluence customer behavior (Werbach and Hunter 2012;Zichermann and Linder 2013). In contrast, the customerperspective defines gamification as “a process of enhancing aservice with affordances for gameful experience to support


customers' overall value creation” (Huotari and Hamari 2017, p.25). This perspective highlights the experience that gamificationattempts to provide and notes that a gameful design is not alwaysobtained by concrete elements but rather results from customers'practices (Insley and Nunan 2014). For companies that adopt thisperspective, the key challenge of gamification is finding a way toenhance customer experiences by providing customers withopportunities to develop game-like interactions.

To understand gamification practices, Robson et al. (2015)suggest using the mechanics–dynamics–emotions framework(MDE). Mechanics include the goals, rules, settings, types ofinteractions, and boundaries of the situation to be gamified. Theseelements depend exclusively on designers' decisions and do notchange from one customer to another or across time (Robson etal. 2015). Dynamics are behaviors and interactions that emergefrom customers' gamified experience (Camerer 2003). Theyencompass both desired behaviors (e.g., cooperation amongcustomers, more contributions) and unintended behaviors (e.g.,cheating) (Elverdam and Aarseth 2007). Finally, emotionalcomponents include the positive and negative affective reactionsinduced by game-like settings (Robson et al. 2015). Therefore,the MDE framework encompasses both game designers' andcustomers' perspectives, because it includes the game designsimposed by company designers and customer reactions.

Although designers predetermine gamification mechanics,the impacts of these mechanics on customer experience andengagement are difficult to predict and may be counterproduc-tive. Consequently, a key issue for designers is being able todevelop mechanics that generate the intended effects (Robson etal. 2015). However, valid research on gamification is missing;there is still a need to identify best practices to develop andmanage gamification mechanics (Hamari et al. 2014; Lucassenand Jansen 2014; Werbach and Hunter 2012). Further researchalso is required to test the impact of gamification mechanics onCE and investigate its potential (Harwood and Garry 2015).

Gamification as CE Mechanics

Harwood and Garry (2015) and Robson et al. (2014) recentlyprovided the first qualitative insights into the positive impacts ofgamification mechanics on customer experience and engagement.In line with these authors, research in educational sciences hasidentified gamification mechanics as powerful tools for initiatinglearning and integrating resources,which are the two key processesof CE (Domínguez et al. 2013; Landers 2014; Landers andLanders 2014). In gamification mechanics, various types ofchallenges attract the interests of scholars and practitioners(Harwood and Garry 2015). A challenge is an initiative thatrequires participants to achieve a task by overcoming specificobstacles. However, varying levels of difficulty make thecompletion of the challenge and the receipt of related rewardsuncertain. This uncertainty makes the challenge intrinsicallymotivating (Malone 1981). By taking up challenges, participantslearn progressively how to master tasks and overcome obstacles(Hanus and Fox 2015; Landers 2014). This sense of accomplish-ment and mastery generates enjoyable experiences (Koster 2013).Competition and cooperation mechanics indicate two promising

forms, because they introduce the notion of challenge in socialdynamics (Malone 1981). Competition and cooperation mechan-ics reinforce a sense of uncertainty, given that the achievement ofchallenges depends on other participants' performance (MaloneandLepper 1987). By setting high levels of uncertainty, challengesenhance customers' experiences. According to Brodie et al. (2011),CE is the result of interactive experience; therefore, wehypothesize that gamification mechanics positively affect CE byenhancing the experience.

H1. Competition and cooperation mechanics' impact on CE ismediated by customer experience.

The design of challenges implies that some participants reachthe objectives set and some do not. The proportion of losers on anengagement platform may be quite large, especially if the level ofdifficulty is high. Lack of acknowledgement for the effortexpended may have counterproductive effects on customerrelationships (Fombelle, Bone and Lemon 2016). Indeed, losinga contest combines two effects that may negatively influencecustomer's experience and their resulting level of engagement. Onthe one hand, customers receiving a feedback for their performancein the contest, whether a winning or a losing decision, becomecertain of the reception or the non-reception of a reward (Malone1981). However, research in psychology highlights that uncer-tainty plays a key role in making gamified contexts engaging(Anselme 2010). In that respect, the uncertainty of stimulus–reward relationship motivates individuals to initiate reward-seeking behaviors (Arias-Carrion and Poppel 2007). This leadsparticipants to experience higher arousal and consequentlydeepens their interest in the operated tasks (Hong et al. 2009;Howard-Jones et al. 2009; Howard-Jones and Demetriou 2009).Uncertainty strengthens learning process and engagement (Arias-Carrion and Poppel 2007; Cannon and Bseikri 2004; Hong et al.2009). Accordingly, as receiving a performance feedback –embodied in the winning and losing decision – withdraws theuncertainty experienced by the participants, the benefits ofgamification related to uncertainty are weakened (Malone andLepper 1987). Therefore, we hypothesize:

H2. Receiving a win/lose decision weakens the experientialbenefits induced by gamification mechanics (competition and/or cooperation mechanics).

On the other hand, prior research has highlighted that losshas a greater influence on individuals' reactions and behaviorsthan gains do (Ariely, Huber and Wertenbroch 2005; Kermer,Driver-Linn, Wilson, and Gilbert 2006; Novemsky andKhaneman 2005). This asymmetry is commonly referred to asloss aversion. According to McGraw et al. (2010), the effect ofloss aversion is more likely to be observed when people areable to compare gains and losses directly. In the case of acontest, rules explicit the actions asked to participants, theperformance criteria and the potential prizes. They makeconsequently the win and lose situations easily comparable interms of participants' performances and rewards.

However, does the negative impact of losing a contest varyaccording to the gamification mechanics used, that is, accordingto whether competition and/or cooperation mechanics areapplied? We turn to equity theory to answer this question,


because it conceptualizes how people perceive the balancebetween investments and rewards when they compare theirsituations with others with whom they have social exchanges(Adams 1963; Ahrens, Coyle, and Strahilevitz 2013).

Equity Theory

Equity theory is rooted in social comparison literature(Festinger 1954); it postulates that people in social exchangerelationships jointly compare the ratio of their inputs toexchanges against their outcomes from those exchanges(Adams 1963; Adams and Freedman 1976). Inequity occurswhen the perceived inputs and/or outcomes in exchangerelationships are perceived as inconsistent with the inputs and/or outcomes of a referent group (Adams 1965). Perceived equitygenerates feelings of fairness, which improve the relationshipsamong actors who are exchanging resources. Fairness alsoincreases people's trust and loyalty to exchanges (Bolino andTurnley 2008; Tseng and Kuo 2014). However, when peoplenotice that others are receivingmore benefits, their dissatisfactioncan result in a sense of unfairness (Ajzen, Rosenthal, and Brown2000) and perceived inequity in the social exchange relation-ships, which they seek to restore by revising their perceptions ofthe exchanges (Adams 1963; Adams and Freedman 1976).

Accordingly, when customers win a contest, they are notnegatively affected by inequity feeling as they consider they arenot unfairly treated by the process. Conversely, customers wholose a company contest that is driven by competition mayperceive inequity in their relationship with the company becausethey are threatened differently than participants who win. Thisperceived inequity might lead them to revise their investments intheir relationships with the company. Such motivationally driveninvestments characterize CE (Hollebeek, Srivastava, and Chen2016), so losing a contest designed with competition mechanicsshould have a negative impact on CE. In contrast, losing a contestdesigned with cooperation mechanics implies that none of theparticipants is rewarded, which should prevent participants fromcomparing their investments and outcomes with others. There-fore, we hypothesize

Fig. 1. Conceptual model. *p b

H3. Losing a contest designed with competition mechanics hasa stronger negative impact on customer experience than losinga contest designed with cooperation mechanics.

Finally, CE is the result of a dynamic and iterative process(Brodie et al. 2011; Hollebeek 2011; Storbacka et al. 2016).Therefore, Leclercq et al. (2017) highlight that the impact ofcompetition and cooperation mechanics may vary according toa customer's prior level of engagement toward the co-creationactivity and the related community. Customers who have highlevels of CE with the co-creation activity and/or the relatedcommunity are less likely to perceive inequity in terms ofrewards, inferred by losing a contest, because they are morelikely to value the participation itself.

H4. The prior level of CE moderates the negative impact oflosing a contest on customer experience.

The hypotheses developed thorough the conceptual discus-sion are summarized in Fig. 1.

Overview of Studies

To test our hypotheses, we carried out three laboratoryexperiments and one field experiment. We implemented thestudies in the context of a co-creation community. Co-creationcommunities enable members to submit their best ideas andcompete to be selected to develop the ideas further; they alsooffer members opportunities to collaborate with others andjointly create value. This duality makes the co-creationcommunity an interesting field for both academics andpractitioners (Bullinger et al. 2010). On such engagementplatforms, competition and cooperation mechanics are contin-uously implemented to select the best ideas and stimulatecustomers to contribute to others' projects. Both types ofmechanics also can be implemented simultaneously incoopetition settings. Prompt decisions by juries informmembers whether their ideas or projects would continue inthe new product development (NPD) process.

Studies 1, 2, and 3 were laboratory experiments thatsimulate the activities of a co-creation community, usingcompetition and/or cooperation mechanics. In Study 1, we

.05; **p b .01; ***p b .001.

Image of Fig. 1


aimed to assess the positive impacts of gamification mechanics(competition and cooperation mechanics), in terms of cus-tomers' experience and resulting engagement during thecontest. We compared two groups: one in which we stimulatedco-creation activities using competition and/or cooperationmechanics, and a control group, in which no gamificationmechanics were implemented, and participants were automat-ically rewarded for their contributions. We measured customerexperience and resulting engagement with the co-creationactivity before participants received win/lose decisions; thecustomers thus had no information about the results of thecontest when we measured experience and the resultingengagement. Conversely, we designed Studies 2 and 3 toanalyze the impact of receiving the win/lose results of thecontest. These studies were similar in design to Study 1, but wemanipulated the win/lose decision and measured customers'experiences and resulting engagement with the co-creationactivity after informing participants they had won (Study 2) orlost (Study 3) the contest.

Subsequently, we conducted a field experiment on a SwissNPD platform to extend the findings to a real setting andcapture the dynamic aspects of CE. We launched three projectson a co-creation platform: the first with competition mechanics,the second with cooperation mechanics, and the third as acontrol group without gamification mechanics, in whichparticipants were automatically rewarded for their contribu-tions. We then administered a questionnaire to the losers. Toexamine the dynamic process, we also measured customers'levels of engagement with the co-creation activity and therelated community before, just after, and three months after theexperiments, using valid measurement scales and behaviors.Table 1 summarizes the four studies.

Study 1

To test H1, we assessed the impact of gamificationmechanics on CE with the co-creation activity and themediating effect of customer co-creation experience withinthis relationship, during a contest. In doing so, we examinedcompetition mechanics, cooperation mechanics, and thecombination of the mechanics in a coopetition setting.

Table 1Overview of studies.

Study 1 Study 2 Study 3 Study 4

SampleSample size 160 160 160 97Age mean 35 37 36 33Gender (female) 49% 49% 42% 49%Participants MTurk MTurk Community membersDesign 2 × 2 2 × 2 2 × 2 3 × 1

PretestPretest sample size 120 NA NA 92Age mean 34 NA NA 33Gender (female) 33% NA NA 40%Participants MTurk NA NA MTurkDesign 2 × 2 NA NA 3 × 1

Study Design and Procedures

We recruited a total of 160 participants (49% female, Mage

= 35 years) from Amazon Mechanical Turk (MTurk) andrandomly assigned them to a 2 (presence vs. absence ofcooperation mechanics) × 2 (presence vs. absence of competi-tion mechanics) between-subjects experimental design. Re-search has shown that, with regard to critical metrics such asrejection rates, statistical power, and distributions, MTurkresponses are similar in quality to responses provided bypopulations sampled in laboratory experiments (Barone andJewell 2014; Goodman, Cryder, and Cheema 2013).

We began by inviting participants to help a startup companydevelop its activity by naming a new smoothie brand, inexchange for a potential financial reward. Through this activity,participants had the opportunity not only to submit ideas butalso to contribute to a list of ideas, described as previouslysuggested by other participants. Next, we exposed them to theexperimental treatment, in which we informed them of thegeneral instructions that varied according to four experimentalconditions (competition mechanics vs. cooperation mechanicsvs. coopetition mechanics vs. control group). According to therules, in the competition condition, only the best propositionswould be rewarded. In the cooperation condition if one of theparticipants' contributions was selected then the reward wouldbe shared among all participants otherwise no one would berewarded. It implies that the reward is collective rather thanindividual. Winning a contest designed with cooperationmechanics implied that at least one participant submits aproposition satisfying criteria determined by an external jury.By contrast, losing such contest means that none of thepropositions satisfy the jury. Cooperation mechanics tends toinduce collaboration among participants by stressing theinterdependency among participants. The coopetition combinescompetition and cooperation mechanics. Participants competeto submit the best idea. However, they are also invited tocooperate on each other's projects. In that respect, a reward ispromised for the authors of the best submissions but there arealso some prizes for participants who contribute to the winningprojects. Finally, in the control group, the reward would beshared among all participants, regardless of the jury's decision.Therefore, the control group simulated a workplace-likeactivity in which participants automatically receive rewardsfor their contributions rather than a game in which the rewardsare uncertain and depend on the contributions of others.

Pretests

All instructions and rules were short and required onlyminimal reading abilities. We pretested them for comprehen-sibility and checked manipulations using a sample of 120participants (33% female, Mage = 34 years), also recruitedthrough an MTurk panel. In the pretest, we assignedparticipants to one of the four conditions. We invited them toanswer a questionnaire, before informing them about whetherthey had won or lost the contest. The pretests includedquestions about the gamification mechanics used (“I feel I am


competing with the other participants” and “I feel I amcooperating with the other participants”), the perceivedlikelihood of winning (“The likelihood to win is [very high–very low]”), and the perceived value of the rewards (“Thepotential reward is [very high–very low]”). As expected, thepretests revealed significant differences with regard to theextent to which the participants felt they were competing orcooperating with others. The groups taking part in the activitydesigned with competition mechanics reported a greater feelingof competition than the other groups (Mcompetition = 4.38;Mno_competition = 2.73; p b .01). In contrast, the groups takingpart in the activity designed with cooperation mechanicsreported a greater feeling of cooperating with others (M-cooperation = 4.50; Mno_cooperation = 3.21; p b .01). There were nosignificant differences with regard to the perceived likelihoodof winning or the value assigned to the rewards.

Measures

Immediately after submitting their ideas, participantsaccessed a survey. Using a questionnaire, we operationalizedthe key study constructs, that is, customer co-creationexperience and CE with the co-creation activity usingestablished multi-item scales. Appendices 1 and 2 report themeasures of the constructs and statistics.

Customer Co-creation ExperienceWe measured customer co-creation experience with a 19-

item scale developed by Verleye (2015). This measure capturesthe four dimensions that characterize CE in the context ofproducts and services co-creation: social (5 items; α = .792),pragmatic (6 items; α = .849), cognitive (5 items; α = .842), andhedonic (3 items; α = .918). All the items used a 5-point Likertscale (1 =“ strongly disagree,” 5 =“ strongly agree”).

CE with the Co-creation ActivityWe adapted the scale developed by Vivek et al. (2014). This

15-item, 5-point Likert scale encompasses three dimensions:conscious attention (6 items; α = .931), enthused participation(6 items; α = .923), and social connection (3 items; α = .923).

We concluded the experiment with manipulation checks. Wechecked for the presence of competition or cooperationmechanics with two items, asking participants to rate the extentto which they felt they were competing or cooperating with otherparticipants (“I feel I am competing with the other participants”and “I feel I am cooperating with the other participants”).Finally, we debriefed participants about the objectives of theexperiment and thanked them for their participation.

Results

Manipulation ChecksAs expected, the groups that took part in the activity

designed with competition mechanics reported a greater feelingof competing against others than the other groups (Mcompetition

= 3.53; Mno_competition = 2.61; p = .00). Conversely, the groupsthat took part in the activity designed with cooperation

mechanics reported a greater feeling of cooperating with othersthan the other groups (Mcooperation = 3.95; Mno_cooperation = 3.50;p = .01).

FindingsWe tested H1 with the Macro process proposed by Hayes

(2013), which tests direct and indirect effects in a moderatedmediation model. We tested a moderated mediation model(Model 7; bootstrapped samples = 5,000) to assess the extent towhich customer co-creation experience mediated the impact ofcompetition or cooperation mechanics on CE with the co-creation activity. Through this model, we also examined how thesimultaneous implementation of competition and cooperationmechanics (coopetition setting) moderates the effect of compe-tition on customer co-creation experience and engagement.

In a regression using CE as the dependent variable with thecontrol group as the reference group of the experimental treatment(computed as dummies), the main effects of competition (β = .46;t = 3.99; p b .001) and cooperation (β = .43; t = 3.72; p b .001)mechanics were significant and positive. However, addingcooperation mechanics to competition (i.e., coopetition) nega-tively moderated this relationship (β = −.52; t = −3.23; p b .01).The impact of customer co-creation experience on engagementwith the co-creation activity was positive and significant (β =1.23; t = 12.62; p b .001). Furthermore, the direct impact ofcompetition mechanics on CE with the co-creation activity wasnon-significant (β = .01; n.s.). The indirect effect of competitionon CE was positive and significant when cooperation mechanicswere not implemented, with a confidence interval that did notinclude 0 (effect = .56; lower limit confidence interval [LLCI] =.26; upper limit confidence interval [ULCI] = .89). This indirecteffect became non-significant when cooperation mechanics wereadded to competition mechanics (coopetition setting), with aconfidence interval including 0 (effect = −.08; LLCI = −.34;ULCI = .17). Appendix 3 details these results.

In support of H1, these results indicate an indirect-onlymediation when cooperation or competition mechanics areimplemented (Zhao et al. 2010). The gamification mechanics ofcompetition and cooperation positively affect CE by enhancingexperience when the mechanics are not simultaneouslyimplemented. However, when the mechanics are implementedsimultaneously in coopetition settings, the benefits ofgamification are weakened. Fig. 2 illustrates these results.

Study 2

To test the impact of receiving a decision from a jury – eitherwinning or losing – as suggested by H2, we conducted Study 2.We aimed to assess the impact of winning a contest oncustomer co-creation experience and engagement.


We recruited a total of 160 participants (49% female, Mage

= 37 years) from MTurk and randomly assigned them to a 2(winning a contest designed with cooperation mechanics vs.without cooperation mechanics) × 2 (winning a contest

Fig. 2. Resulting model, Study 1. *p b .05; **p b .01; ***p b .001.


designed with competition mechanics vs. without competitionmechanics) between-subjects experimental design. We adopteda procedure similar to Study 1. However, in this case, weinformed each participant individually that he or she had wonthe contest before he or she completed the questionnaire.

Measures

Immediately after being informed they had won the contest,participants accessed the survey. Similarly to Study 1, weoperationalized the key studied constructs, customer co-creation experience and CE with the co-creation activity,using established multi-item scales. Appendices 1 and 2 reportthe measures of the constructs and statistics. All scalesexplained more than 55% of the variance and achieved aCronbach's alpha value greater than .7.

We concluded the experiment with manipulation checks. Asin Study 1, we assessed the presence of competition orcooperation mechanics with two items, asking participants torate the extent to which they felt they were competing orcooperating with others. Moreover, we asked them to indicatewhether they had won or lost the contest. We then debriefedthem about the objective of the experiments and thanked themfor their participation.

Results


designed with competition mechanics reported a greater feelingof competing against other participants than the other groups(Mcompetition = 3.46; Mno_competition = 2.20; p = .00). Groups thattook part in the activity designed with cooperation mechanicsreported a greater feeling of cooperating with other participantsthan other groups (Mcooperation = 3.97; Mno_cooperation = 3.31; p= .00). With regard to whether participants understood they hadwon the contest, every participant reported “yes” to thequestion “Have you won the contest?”

FindingsTo analyze the impact of winning a contest on CE with co-

creation, we used the Macro process by Hayes (2013). We testeda moderated mediation model (Model 7; bootstrapped samples= 5,000); it assessed the extent to which customer co-creationexperience mediated the impact of winning a contest driven by

competition or cooperation mechanics on CE with the co-creation activity. Through this model, we also examined howwinning a contest simultaneously designed with competition andcooperation mechanics (coopetition setting) moderated the effectof competition on customer experience and engagement.

In a regression using customer co-creation experience as thedependent variable, only the main effect of winning a contestdesigned with competition mechanics was positive andsignificant (β = .30; t = 2.53; p b .001). The effects related tothe cooperation mechanics were non-significant. The impact ofcustomer experience on engagement with the co-creationactivity was positive and significant (β = .86; t = 9.44; p b.001). Furthermore, the direct impact of winning a contestdesigned with competition mechanics on CE with the co-creation activity was non-significant (β = .07; n.s.). The indirecteffect of competition on CE was positive and significant whencooperation mechanics were not implemented, with a confi-dence interval that did not include 0 (effect = .26; LLCI = .06;ULCI = .49). This indirect effect became non-significant whencooperation mechanics were added to competition mechanics,with a confidence interval including 0 (effect = −.03 LLCI =−.15; ULCI = .25). Appendix 4 details these results.

The results indicate an indirect-only mediation whencustomers win a contest designed with competition mechanics(Zhao et al. 2010). When customers win a contest designed withcompetition mechanics, the impact of gamification is lessened,but it remains positive. In contrast, when customers win a contestdriven by cooperation mechanics, the positive effect ofgamification is inhibited, prior to the win/lose decision. Theeffect of coopetition mechanics remains non-significant evenwhen customers win. Fig. 3 illustrates these relationships.

Study 3

To confirm H2 and test H3, we assessed the impact of losinga contest designed with competition and/or cooperationmechanics on CE with the co-creation activity. We alsoassessed the mediation effect of customer co-creation experi-ence within this relationship.


We recruited 160 participants (42% female, Mage = 36years) from MTurk and randomly assigned them to a 2 (losing acontest designed with cooperation mechanics vs. without

Image of Fig. 2

Fig. 3. Resulting model, Study 2. *p b .05; **p b .01; ***p b .001.


cooperation mechanics) × 2 (losing a contest designed withcompetition mechanics vs. without competition mechanics)between-subjects experimental design. We adopted a proceduresimilar to Study 2. However, we informed each participantindividually that he or she had lost the contest before he or shecompleted the questionnaire.

Measures

Immediately after being informed they had lost the contest,participants accessed the survey. Similarly to Studies 1 and 2,we operationalized the key study constructs – customer co-creation experience and CE with the co-creation activity –using established multi-item scales (see Appendices 1 and 2).All scales explained more than 55% of the variance andachieved a Cronbach's alpha value greater than .7.

We concluded the experiment with manipulation checks. Asin the previous studies, we assessed the presence of competitionor cooperation mechanics by means of two items that askedparticipants to rate the extent to which they felt they werecompeting or cooperating. Moreover, we asked participants toindicate whether they had won or lost the contest. We thendebriefed them and thanked them for their participation.

Results


designed with competition mechanics reported a greater feelingof competing with others (Mcompetition = 2.84; Mno_competition =2.24; p b .01), whereas those that took part in the activitydesigned with cooperation mechanics reported a greater feelingof cooperating with others than the other groups (Mcooperation =3.54; Mno_cooperation = 3.09, p b .01). With regard to themanipulation check of whether participants understood theyhad lost, every participant reported “yes” to the question “Haveyou lost the contest?”

FindingsTo analyze the impact of losing a contest on CE with the co-

creation activity, we used the Macro process (Hayes 2013) anda moderated mediation model (Model 7; bootstrapped samples= 5,000) that assessed the extent to which customer co-creationexperience mediated the impact of losing a contest driven bycompetition or cooperation mechanics on CE with the co-

creation activity. We also examined how losing a contestsimultaneously designed with competition and cooperationmechanics (coopetition settings) moderated the effect ofcompetition on customer experience and engagement.

In a regression using customer co-creation experience as thedependent variable, only the main effect of losing a contestdesigned with competition mechanics was negative andsignificant (β = −.32; t = 2.57; p b .05). The effects related tothe cooperation mechanics were non-significant. The impact ofthe customer's experience on engagement with the co-creationactivity was positive and significant (β = .92; t = 9.83; p b.001). Furthermore, the direct impact of losing a contestdesigned with competition mechanics on CE with the co-creation activity was non-significant (β = −.10; n.s.). Theindirect effect of losing a competition on CE was negativeand significant when cooperation mechanics were not imple-mented, with a confidence interval that did not include 0(effect = −.29; LLCI = −.54; ULCI = −.09). This indirect effectremained negative and significant when cooperation mechanicswere added to competition mechanics (effect = −.36; LLCI =−.61; ULCI = −.14). Appendix 5 details these results.

They indicate an indirect-only mediation when participantslose a contest designed with competition mechanics (Zhao et al.2010). When customers lose a contest designed with compe-tition mechanics, the impact induced by gamification isnegative regardless of the addition of cooperation mechanics.In contrast, losing a contest exclusively driven by cooperationmechanics inhibits the positive effect induced by gamificationbefore the win/lose decision but does not generate a negativeimpact in terms of customer co-creation experience andresulting engagement. Fig. 4 illustrates the tested relationships.

The findings of Studies 2 and 3 support H2 by showing thatwhen participants are informed of a jury's decision, regardless ofwhether they havewon or lost the contest, the benefits in terms ofCE generated before this decision diminish. Furthermore, Study3 supports H3 by demonstrating that the negative impact in termsof CE with the co-creation activity induced by losing a contest isstronger when a contest is driven by competition mechanics thanwhen it is driven by cooperation mechanics.

Study 4

Although Studies 1, 2, and 3 provide valuable insightsregarding the impact of gamification mechanics in terms ofcustomer co-creation experience and engagement before and

Image of Fig. 3

Fig. 4. Resulting model, Study 3. *p b .05; **p b .01; ***p b .001. (Coefficient after the three-month period.)


after win/lose decisions, they have several limitations. First, theyrely on a simulated context, so replicating these studies in a real-world setting is necessary to generalize the findings. Second,though Brodie et al. (2013) distinguish two objects of CE in thecontext of online platforms – that is, co-creation activity and therelated community – our three lab experiments examine only theimpact of gamification on the level of CE with the co-creationactivity; because of the simulated aspects of these studies, therewas no community development around the co-creation activity.Third, the dynamics and iterative process underlying CE andhighlighted by Brodie et al. (2011) and Storbacka et al. (2016)cannot be captured in laboratory experiments. To address theselimits and test H4, we carried out a field experiment.

Through collaboration with a Swiss NPD platform, iBrain,we conducted the field study. Launched in 2011, this platform isjointly developed and managed by Haute école spécialisée deSuisse occidentale (HES-SO) and Atizo, a Swiss leader of openinnovation systems. It enables companies and public organiza-tions to submit their projects and issues through challengessuggested to iBrain's community providers of ideas andsolutions. On this platform, individuals are invited to submittheir ideas, as well as vote for and enrich ideas suggested byothers. Projects may involve not only the development ofproducts and services but also the organization of events. Theyvary from open ideation (e.g., how to revitalize tourism in aSwiss village) to more technical projects (e.g., how to promotenew management software). The rules, rewards, and duration ofthe challenges are determined by the participating organizations.


We launched three projects related to the promotion ofhealthy practices on the iBrain platform. We designed twoprojects with competition and cooperation mechanics, respec-tively. In the project driven by competition mechanics, werewarded only the best submission. In contrast, in the projectdriven by cooperation mechanics, we promised to share thereward among participants if the jury selected one of them. Wedesigned the third project as a control group, withoutgamification mechanics, in which we promised a reward forevery member contributing to the project. We implemented thethree projects consecutively on the platform. Each challengelasted one month, during which we invited iBrain community

members to submit ideas, contribute to others' projects, andvote for the submissions they liked.

Pretests

We designed instructions and rules to be short and adaptedthem to be similar to other projects submitted on iBrain. Wepretested them for comprehensibility and checked the manip-ulations with 92 participants (40% female, Mage = 33 years)whom we recruited through an MTurk panel. In this pretest, weassigned participants to one of three conditions and asked themto report the extent to which they were taking part in an activitydriven by competition or cooperation. As expected, participantswho faced competition mechanics reported a greater feeling ofcompeting against others (MCompetition = 4.55; MCooperation =2.34; MControl = 2.33; p b .00). Similarly, participants whofaced cooperation mechanics reported a greater feeling ofcooperating with others (MCompetition = 1.83; MCooperation =4.72; MControl = 2.43; p b .00). One week after the end of thesubmission period on iBrain, we informed each participantindividually that he or she had lost the challenge and invitedhim or her to complete a questionnaire.

Measures

Similar to the laboratory experiments, the questionnaireincluded multi-item scales that measured the customer co-creation experience and CE with the co-creation activity.However, because we had operationalized our experiment in areal co-creation community, we also were able to access CEwith the related community, using a four-item Likert scaledeveloped by Algesheimer, Dholakia, and Herrmann (2005).Appendices 1 and 2 report the constructs and statistics. Thisscale explained more than 55% of the variance and achieved aCronbach's alpha value greater than .7. The questionnaireclosed with manipulation checks for the presence of competi-tion or cooperation mechanics, using two items that askedparticipants to rate the extent to which they felt they werecompeting or cooperating with others.

In addition to applying the questionnaire, we evaluatedparticipants' prior and post-study levels of engagementaccording to their behaviors on the platform before thechallenges had started. Accordingly, we measured participants'prior levels of engagement with the co-creation activity by the

Image of Fig. 4


number of ideas submitted on the platform before theexperiment. We evaluated their prior level of engagement withthe community according to the number of comments and“likes” posted before and after the experiment. To capture thedynamics and iterative process that characterized participants'engagement, we assessed the level of CE not only directly afterthe experiment but also during the three-month periodsubsequent to the experiment. Accordingly, we measuredparticipants' post-study levels of engagement with the co-creation activity and the community, according to participants'behaviors during the three-month period following the experi-ment. During these three months, we did not send either “win” or“lose” decisions related to other contests to the participants.

Results

From this field experiment, we collected 97 completequestionnaires (Ncompetition = 34; Ncooperation = 30; Ncontrol =33, n.s.). Participants' mean age was 33 years, and 49%indicated they were women. We found no significantdifferences among the three conditions in terms of prior levelof engagement with the activity (Mcooperation = 2.83; M-competition = 3.15; Mcontrol = 2.79, n.s.) or the community (M-cooperation = 2.06; Mcompetition = 1.73; Mcontrol = 1.83, n.s.).

Manipulation ChecksSimilar to the pretest and the laboratory experiments, the

groups that took part in the activity designed with competitionmechanics reported a greater feeling of competing againstothers (Mcompetition = 4.55; Mno_competition = 2.43: p b .01). Thegroups that took part in the activity designed with cooperationmechanics reported a greater feeling of cooperating with others(Mcooperation = 4.16; Mno_cooperation = 2.34; p b .01).

FindingsWe conducted the data analysis using a two-step procedure.

First, we carried out a comparison between those who lost achallenge designed with cooperation and the control group. We

Fig. 5. Resulting model, Study 4, first part (standardized coefficients). *p b

tested a moderated mediation model (Model 7; bootstrappedsamples = 5,000) to assess the extent to which the mediatingeffect of customer experience in the relationship between losinga cooperation challenge and CE with the co-creation activityand the community was moderated by customers' prior levels ofengagement with these two objects. Appendix 6 reports theresults with significant paths and standardized coefficients.With the exception of the relationship between customerexperience and CE with the co-creation activity and thecommunity directly after the experiment (β = .84; t = 10.25; pb .01 and β = .73; t = 7.52; p b .01, respectively) and threemonths later (β = .30; t = 1.98; p b .05 and β = .38; t = 2.39; pb .05, respectively), there was no significant effect.

Second, we carried out a comparison between those who losta challenge designed with competition and the control group.We adopted a procedure similar to the first step. Appendix 7reports the results with significant paths and standardizedcoefficients. In a regression using customer co-creationexperience as the dependent variable, similar to previousstudies, the main effect of losing a challenge designed withcompetition mechanics was negative and significant (β = −.86;t = −3.80; p b .01). The moderating effect of customers' priorlevels of engagement with the co-creation community on therelationship between losing and customer experience wassignificant and positive (β = .46; t = 2.12; p b .05). Therelationships of customer experience with their engagementwith the co-creation activity or with the related communityremained significant and positive not only just after theexperiment (β = .75; t = 10.04; p b .01; β = .71; t = 9.09; p b.01, respectively) but also three months later (β = .46; t = 4.00;p b .01; β = .39; t = 3.42; p b .01, respectively).

These results indicate an indirect-only mediation whenparticipants lose a contest designed with competition mechan-ics (Zhao et al. 2010). When customers lose a challengedesigned with competition mechanics, the impact induced bygamification is negative, but participants' prior levels ofengagement with the co-creation community moderate thiseffect. Therefore, H4 is supported by the data. Figs. 5 and 6

.05; **p b .01; ***p b .001. (Coefficient after the three-month period.)

Image of Fig. 5

Fig. 6. Resulting model, Study 4, second part (standardized coefficients).


illustrate the tested relationships. The results also confirm H3by showing that the negative impact on the level of CE inducedby losing a competition persists even three months after thecontest, underlining the importance of this effect.

General Discussion

This research investigates the boundaries of gamificationmechanics as a means to create, boost, and maintain CE.Through three laboratory experiments and one field experi-ment, our findings provide strong empirical evidence thatgamification mechanics – that is, cooperation and competition– positively affect CE by enhancing customer experienceduring a contest (Harwood and Garry 2015; Robson et al.2014). However, the results also reveal that when cooperationand competition mechanics are simultaneously implemented, incoopetition settings, the benefits in terms of experience andengagement are weakened.

Furthermore, we emphasize that these benefits are limited tocustomers who receive a win/lose decision. Similarly Malone(1981) suggests that the win/lose decision eliminates theuncertainty surrounding the success of challenges. We alsocompare the impact on CE of losing a contest according to thegamification mechanics used, that is, competition, cooperation,or coopetition. The impact induced by losing a contest designedwith competition mechanics seems to have stronger negativeeffects on participants' experience and resulting engagement.Therefore, customers seem to prefer “lose/lose” situationscharacterized by losing in a cooperation setting, to the “win/lose” condition of a competition setting. This finding issupported by game and social exchange theories, whichemphasize the key role of perceived equity in social exchanges(Adams and Freedman 1976; Morton 1987); in “win/lose”conditions, losers may sense unfairness relative to winners. Eventhough the “lose/lose” condition suggests that no participants arerewarded for their contributions, a feeling of equity among theparticipants results. The determinant aspect of equity in CE also

transcends the definition of value co-creation and the distinctionwith value co-destruction. In this sense, value co-creation refersto the reciprocal creation of value for all engaged actors(Aarikka-Stenroos and Jaakkola 2012). Conversely, value co-destruction refers to practices that lead to the decline of value forat least one actor (Plé and Chumpitaz 2010). Therefore, “win/lose” conditions prompt a value co-destruction process, becauseperceived equity is not established. To reduce perceivedinequity, participants may revise their relationships with theactivity and the related community. However, this research goesbeyond the dyadic relationships between customers andcompanies to consider interactions among customers. Accord-ingly, we emphasize the need to ensure perceived equity amongcustomers to engage them in the value co-creation process.

Finally, we capture the dynamics and iterative process of CEby assessing the moderating impact of customers' prior levels ofengagement with the co-creation activity and the relatedcommunity. We demonstrate the key role performed by CE withthe community: It moderates the negative impacts induced bylosing a competition. Accordingly, customers who are alreadyhighly engaged with a co-creation community are less influencedthan newcomers by losing a competition. The reason may be thatparticipants who are highly engaged with a community value therelationship established with other members of the communitymore than the promised rewards. Consequently, they are lessinfluenced than newcomers by the non-receipt of rewards,because they use other types of metrics to compare themselvesto others (e.g., numbers and quality of interactions with othermembers). We also show that the effects on CE are persistent,which emphasizes the need to examine CE over time.

Conclusion

In increasingly competitive environments, the opportunity toengage customers in a value co-creation process is a highlychallenging task for companies, especially in the onlinecontext. With four studies, this research responds to calls by

Image of Fig. 6


Breidbach, Kolb, and Srinivasan (2013) and Ostrom et al.(2015) to offer a better understanding of how gamificationmechanics can be used to create, boost, and maintain CE, whichis a widely targeted variable for marketing managers. It alsoresponds to the recent call by Harwood and Garry (2015) toquestion the effectiveness of gamification, identify its limits,and provide guidelines on how to implement it properly anddeal with cases in which customers lose contests — a situationexperienced by the majority of customers (Hamari et al. 2014;Lucassen and Jansen 2014).

We model and test empirically the impacts of gamificationmechanics on customer experience and resulting engagementtoward a co-creation activity and a related community. Werecognize that CE is characterized by its intensity and dynamicnature; we cannot capture it by measuring it at one specificpoint in time, which is an approach that previous studies haveoverused (Brodie et al. 2011). The longitudinal design that weadopt in this research seems more appropriate to capture CE(Brodie et al. 2011, 2013; Storbacka et al. 2016). We show thatthe benefits of gamification for CE are limited by the receipt ofa jury decision, that is, a win/lose decision. Receiving thisdecision mitigates uncertainty and thereby makes the contestchallenging and engaging (Malone 1981). Furthermore, sup-ported by equity theory (Adams 1963, 1965; Adams andFreedman 1976), we contribute to marketing literature bydemonstrating the negative effects of losing a contest,especially when the contest is designed with competitionmechanics. Moreover, customers who are already highlyengaged with a co-creation community are less influencedthan newcomers by losing a competition. These resultschallenge managerial practices and call on practitioners tovary their use of gamification mechanics according tocustomers' strength of engagement with a community. Forexample, the findings suggest practitioners should use cooper-ation mechanics with newcomers – because the negativeimpacts of such mechanics are limited in cases of losing –and introduce competition mechanics only for customers whoare more engaged with the community.

Despite our intensive and rigorous experimental approach,some limitations to our work persist. Because our study is oneof the first empirical investigations of gamification mechanics,further research is needed to ensure the generalizability of ourfindings and analyze other gamification practices, such asbadge systems, 3D environments, or playful designs, incontexts such as healthcare, retail, and services. Furthermore,our research highlights three tracks that deserve furtherinvestigation. First, through our analysis, we reveal thecounterproductive effects of implementing cooperation andcompetition mechanics simultaneously, that is, in coopetitionsettings. These effects should be examined further to under-stand the impact of the coopetition settings that increasingly arebeing used to design co-creation platforms. Role theory (Biddle2013) may be a promising strategy to explain the stress createdwhen customers simultaneously must manage conflicting roles,such as competitor and cooperator. Second, whereas we focuson the win/lose decision as a limit of gamification benefits toCE, further academic effort should be dedicated to identifyingthe strategies that can be used to keep the gamified activityengaging, following a win/lose decision. Third, though weemphasize the negative impact on CE of losing a contestdesigned with competition mechanics, there should be furtherinvestigation of how the explanation of why participants havelost or won the contest influences the effects on CE, byreducing the perceived inequity. We strongly recommendadditional investigation of the suggested topics to gain a betterunderstanding of the emergent concept of gamification; thesecontinued insights will have applications in multiple manage-ment contexts for both academic and managerial purposes.

Acknowledgment

We are very grateful to iBrain for providing the opportunityto develop our field experiment in its co-creation community.Any errors are the full responsibility of the authors. Thisresearch did not receive any specific grant from fundingagencies in the public, commercial, or not-for-profit sectors.

Appendix 1. Measurement Scale Items

Constructs
Items
Customer co-creation experience
Hedonic dimension It was a nice experience.
It was fun.I enjoyed it.

Cognitive dimension
I can improve my skills.I gain new knowledge/expertise.I can test my capabilities.It allows me to keep up with new ideas and innovations.It enables me to come up with new ideas.
Social dimension
The interaction was pleasant.I was able to connect with other people.I can make others aware of my knowledge and ideas.I can make a good impression on other people.I meet others with whom I share similar interests.


(continued)Appendix 1 (continued)

Constructs
Items
Pragmatic dimension
I got compensation according to the effort made.I got a fair return.I got an appropriate reward in return for my input.I had control over the quality.The quality was in my hands.I had an impact on the degree to which my preferences were met.
Customer engagement with the co-creation activity
Conscious attention I like to know more about this type of contest.
I like events that are related to this type of contest.I like to learn more about this type of contest.I pay a lot of attention to anything about this type of contest.I keep up with things related to this type of contest.Anything related to this type of contest grabs my attention.

Enthused participation
I spend a lot of my discretionary time this type of contest.I am heavily into this type of contest.I try to fit this type of contest into my schedule.I am passionate about this type of contest.My days would not be the same without this type of contest.I enjoy spending time on this type of contest.
Social connection
I love this type of contest with my friends.I enjoy this type of contest more when I am with others.This type of contest is more fun when other people around me do it too.
Customer engagement with the co-creation community
I benefit from following this community's rules.I am motivated to participate in this community's activities because I feel better afterwards.I am motivated to participate in this community's activities because I am able to support other members.I am motivated to participate in this community's activities because I am able to reach personal goals.
Appendix 2. Measurement Scale Statistics

Cronbach's alpha

Constructs
Study 1 Study 2 Study 3 Study 4
Hedonic dimension .92 .91 .9 .8 Cognitive dimension .84 .83 .79 .9 Social dimension .79 .79 .79 .9 Pragmatic dimension .85 .82 .78 .9
Customer engagement with the co-creation activity
Conscious attention .93 .89 .92 .9 Enthused participation .92 .88 .9 .87 Social connection .92 .86 .89 .83 Customer engagement with the co-creation community NA NA NA .85
Appendix 3. Results of Study 1

A. Indirect effects of gamification mechanics on CE with the co-creation activity

Dependent variables

CE with the co-creation activity
Beta
SE Beta SE
Model 1
Constant 3.59 ⁎⁎ .08 Competition mechanics .46 ⁎⁎ .11 Cooperation mechanics .43 ⁎⁎ .11 Competition mechanics × Cooperation mechanics −.52 ⁎ .16
Model 2
Constant −1.53 ⁎⁎ .38 Customer co-creation experience 1.23 ⁎⁎ .1 Competition mechanics .01 .1 Cooperation mechanics .19 .1



A. Indirect effects of gamification mechanics on CE with the co-creation activity

Dependent variables

Beta
SE Beta SE
B. Conditional indirect effects of gamification mechanics on CE with the co-creation activity through customer co-creation experience

Effect
LLCI ULCI
Competition mechanics only
.56 .26 .89 Cooperation mechanics only .51 .24 .82 Competition mechanics combined with cooperation mechanics −.08 −.34 .17 * p b .01.** p b .001.

A. Indirect effects of winning a challenge on CE with the co-creation activity

Dependent variables

Beta
SE Beta SE
Model 1
Constant 3.83 ⁎⁎ .08 Competition mechanics .30 ⁎ .12 Cooperation mechanics .02 .12 Competition mechanics × Cooperation mechanics −.27 .17
Model 2
Constant −.1 .36 Customer co-creation experience .86 ⁎⁎ .1 Competition mechanics .07 .1 Cooperation mechanics .12 .1
B. Conditional indirect effects of winning a challenge on CE with the co-creation activity through customer co-creation experience

Effect
LLCI ULCI
.26 .06 .49 Cooperation mechanics only .02 −.19 .21 Competition mechanics combined with cooperation mechanics .03 −.15 .25 * p b .05.** p b .001.

A. Indirect effects of losing a challenge on CE with the co-creation activity

Dependent variables

Beta
SE Beta SE
Model 1
Constant 3.82 ⁎⁎ .09 Competition mechanics −.32 ⁎ .12 Cooperation mechanics −.1 .12 Competition mechanics × Cooperation mechanics −.07 .18
Model 2
Constant −.23 .36 Customer co-creation experience .92 ⁎⁎ .9 Competition mechanics −.1 .11



A. Indirect effects of losing a challenge on CE with the co-creation activity

Dependent variables

Beta
SE Beta SE
Cooperation mechanics
−.08 .1
B. Conditional indirect effects of losing a challenge on CE with the co-creation activity through customer co-creation experience

Effect
LLCI ULCI
−.29 −.54 −.09 Cooperation mechanics only −.09 −.27 .1 Competition mechanics combined with cooperation mechanics −.36 −.61 −.14 * p b .05.** p b .001.
Appendix 6. Results of Study 4: Cooperation Mechanics (Standardized Coefficients)

A. Indirect effects of losing a challenge driven by cooperation mechanics on CE with the co-creation activity/community moderated by prior level of CE with the co-creation activity/community

Dependent variables

Customerco-creationexperience

CE with theco-creationactivity(Just after theexperiment)

CE with theco-creationcommunity(Just after theexperiment)

CE with theco-creationactivity(Three monthsafter theexperiment)

CE with theco-creationactivity(Three monthsafter theexperiment)

Beta
SE Beta SE Beta SE Beta SE Beta SE
Model 1
Constant .36 ⁎ .14 Cooperation mechanics −.21 −1.02 Prior level of CE with the co-creation activity .15 .37 Cooperation mechanics × Prior level of CE with
the co-creation activity
−.11 −.21
Model 2
Constant .36 ⁎ .14 Cooperation mechanics −.21 .20 Prior level of CE with the co-creation community .07 .13 Cooperation mechanics × Prior level of CE with
the co-creation community
−.27 .20
Model 3
Constant .10 .10 .12 .12 .24 .18 .02 .18 Customer co-creation experience .84 ⁎⁎ .08 .73 ⁎⁎ .10 .30 ⁎ .15 .38 ⁎ .16 Cooperation mechanics −.03 .83 −.13 .16 −.22 .25 .15 .57
B. Conditional indirect effects of losing a challenge driven by cooperation mechanics on CE with the co-creation activity/community through customer co-creationexperience moderated by prior level of CE with the co-creation activity

CE with the co-creationactivity(Just after theexperiment)

CE with the co-creationcommunity(Just after theexperiment)

CE with the co-creationactivity(Three months after theexperiment)


Effect
LLCI ULCI Effect LLCI ULCI Effect LLCI ULCI Effect LLCI ULCI
One standard deviation below prior level of CEwith the co-creation activity mean (=−.43)

−.14
−.67 .39 −.13 −.62 .36 −.05 −.32 .12 −.06 −.37 .15
At prior level of CE with the co-creation activitymean (=−.03)

−.18
−.53 .17 −.16 −.50 .15 −.06 −.26 .04 −.03 −.28 .07
One standard deviation below prior level of CEwith the co-creation activity mean (=.37)

−.21
−.80 .51 −.19 −.74 .42 −.08 −.40 .12 .37 −.37 .22



B. Conditional indirect effects of losing a challenge driven by cooperation mechanics on CE with the co-creation activity/community through customer co-creationexperience moderated by prior level of CE with the co-creation activity





Effect
C. Conditional indirect effects of losing a challenge driven by cooperation mechanics on CE with the co-creation activity/community through customer co-creationexperience moderated by prior level of CE with the co-creation community





Effect
One standard deviation below prior level of CEwith the co-creation community mean (=−.36)

−.09
−.43 .32 −.08 −.42 .27 −.03 −.20 .11 −.04 −.22 .13
At prior level of CE with the co-creationcommunity mean (=.01)

−.18
−.61 .16 −.16 −.57 .13 −.06 −.28 .04 −.08 −.33 .05
One standard deviation below prior level of CEwith the co-creation community mean (=1.06)

−.41
−2.46 .24 −.37 −1.80 .20 −.15 −.88 .05 −.18 −1.13 .09
* p b .05.** p b .001.

Appendix 7. Results of Study 4: Competition Mechanics (Standardized Coefficients)

A. Indirect effects of losing a challenge driven by competition mechanics on CE with the co-creation activity/community moderated by prior level of CE with the co-creation activity

Dependent variables

Customerco-creationexperience

CE with the co-creation activity(Just after theexperiment)


CE with the co-creationactivity(Three monthsafter theexperiment)

CE with the co-creationactivity(Three monthsafter theexperiment)

Beta
SE Beta SE Beta SE Beta SE Beta SE
Model 1
Constant .36 ⁎ .16 Competition mechanics −.86 ⁎⁎ .23 Prior level of CE with the co-creation activity .15 .41 Competition mechanics × Prior level of CE withthe co-creation activity
.07
.43
Model 2
Constant .36 ⁎ .15 Competition mechanics −.82 ⁎⁎ .22 Prior level of CE with the co-creation community .07 .14 Competition mechanics × Prior level of CE withthe co-creation community
.46 ⁎
.22
Model 3
Constant .13 .10 .14 .11 .18 .16 .01 .15 Customer co-creation experience .75 ⁎⁎ .08 .71 ⁎⁎ .08 .46 ⁎⁎ .12 .39 ⁎⁎ .11 Competition mechanics −.34 ⁎ .15 −.27 .16 −.35 .24 −.17 .23



B. Conditional indirect effects of losing a challenge driven by competition mechanics on CE with the co-creation activity/community through customer co-creationexperience moderated by prior level of CE with the co-creation activity





Effect
B. Conditional indirect effects of losing a challenge driven by competition mechanics on CE with the co-creation activity/community through customer co-creationexperience moderated by prior level of CE with the co-creation activity





Effect
One standard deviation below prior level of CEwith the co-creation activity mean (=−.5)

−.67
−1.10 −.23 −.63 −1.02 −.21 −.41 −.78 −.15 −.35 −.74 −.11
At prior level of CE with the co-creation activitymean (=.01)

.65
−1.14 −.31 −.61 −1.00 −.30 −.40 −.79 −.17 −.33 −.73 −.12
One standard deviation below prior level of CEwith the co-creation activity mean (=1.18)

−.59
−1.85 .38 −.55 −1.67 .32 −.36 −1.31 .17 −.30 −.97 .17
C. Conditional indirect effects of losing a challenge driven by competition mechanics on CE with the co-creation activity/community through customer co-creationexperience moderated by prior level of CE with the co-creation activity





Effect
One standard deviation below prior level of CEwith the co-creation community mean (=−.36)

−.75
−1.13 −.31 −.70 −1.09 −.3 −.46 −.84 −.17 −.38 −.75 −.14
At prior level of CE with the co-creationcommunity mean (=.00)

−.62
−1.06 −.21 −.58 −.99 −.24 −.38 −.82 −.14 −.32 −.74 −.08
One standard deviation below prior level of CEwith the co-creation community mean (=1.02)

−.27
−.73 1.76 −.25 −.67 1.52 −.16 −.50 .85 −.14 −.52 .65
* p b .05.** p b .001.

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