REWARDS
In 1930, Burrhus Frederic Skinner, who was a psychologist at Harvard University, invented the Operant Conditioning Chamber, better known as the Skinner Box. This box was a chamber that had a lever a lever that an animal, usually a rat or a pigeon, can press down with the hope to obtain food or water as a reward. This reward is referred to as the "reinforcer." The Box was used for a number of experiments, most of which revolved around finding the factors which caused the animal to pull the lever more or less often (called the "rate of response").
Their conclusions have had a huge impact in a number of fields revolving around the motivation industry. This included fields such as motivation improvement, study of additions, conduct modification, employee's engagement, game design and many others.
The most basic level of results showed the pigeons were more likely to push the lever more often when there was a 50% chance that they would receive a reward. What was strange was that this happened even more often than when they received one 100% of the times. This is called an intermittent reward schedule and it is one of the most powerful game mechanics used to engage players. They also found that the most effective reward schedule was a variable ratio reward schedule (where the result was 50% of the time, but they could possible get 3 rewards in a row and then nothing for 5 lever pushes) as opposed to a fixed ratio reward schedule (for example, where they would get a reward every 2 lever pushes no matter what).
Basically, the combination of unlocking the reward just 50% of the time together with not knowing exactly when the reward is going to be unlocked, inserts a level of randomness into the equation such that there could be many pulls of the lever with no payoff, but the average payoff is set and somehow can be intuited. This combination is irresistible and produces both the highest rate of responding and the greatest resistance to extinction.
So what does this mean for us? Animals (and humans) can be persuaded to perform an activity more often simply by giving us a chance of a reward instead of promising us a guaranteed reward. We tend to know this intuitively, which is why many people enjoy gambling.
Thousands of games use these principles. Slot machines will intermittently reward you with money, Farmville will randomly give you gifts (usually items to be used on your farm), and World of Warcraft mobs only drop the loot you need for quests some of the time and not all of the time.
LOSS AVERSION
Loss aversion is a behavioural characteristic of the human nature demonstrated by the psychologists Amos Tversky and Daniel Kahneman in 1979 as a part of their prospect theory). It describes how people are intrinsically afraid of losses when they choose between probabilistic alternatives that involve risk. Basically, instead of looking at the "big picture" or the final outcome, we look at each loss as its own event, which makes those losses irritate us more. We dislike losing more than we enjoy winning.
Prospect theory says that there are two stages in the decision process: editing and evaluating. During the editing part of the decision making process, people will look at their choices and then set a goal or reference point. Then, they will look at that point during every event; in relation to that reference point, they call the negative outcomes "losses" and the positive outcomes "gains."
In the evaluation phase of decision, people will chose what they perceive to be the best option; this is usually the option with the most utility, which is based on the potential outcomes and their respective probabilities when it comes to obtaining that outcome. For example, let's look at this: if someone gave you 2 options; the first one, you are given the offer of $50 with no stipulations. The second one gives you the chance of winning $100, just by flipping the coin. Which of them would you choose? Both options are mathematically equivalent, but most people would choose to get the $50.
Loss aversion is the most powerful game mechanic present in many games. For example, in FarmVille, you don't return, your investments die and you will feel like you wasted your time and money. Loss aversion is also present in poker, when a player decides to bet less money that he should (based on his odds) just because he doesn't want to risk all his chips and get knocked out of a tournament. The idea of losing everything has more weight than the potential amount that he could win on this particular hand.
ACHIEVEMENTS
Achievements are, in short, a representation of a specific accomplishment. In some cases, they will give you something that helps you progress in the game. In other cases, they're just a great way for you to brag to your fellow gamers about your accomplishments. But why do people love achievements? How do they drag us even further into our virtual experience?
That's where Abraham Maslow comes in. His research revolved around something that he called the "hierarchy of needs".
The needs on Maslow's hierarchy work from the bottom and go upward. The concept is, in short, that we have all of these needs in our lives. As life goes forward, the needs that we have become much more complex in nature and they also become much more difficult to attain. We feel accomplished when we ensure that these needs are taken care of; we feel as if we have achieved something in our lives.
Achievements are the 4th step of any individual's needs. We like to feel as if we accomplished something. If you defeat a raid boss in World of Warcraft, you feel as if you have accomplished something, and it gives you a feeling of satisfaction and pride. But, what if you are a player that doesn't raid? How can Blizzard help you to feel accomplished? The achievements that they provide give you little "bread crumbs" that tempt you to come back and achieve those things. Some of them may seem trivial; others are incredibly difficult. Either way, you feel as if you have accomplished something, and the need for esteem has been fulfilled by the achievement system.
So where do we see achievements?