The Impact of Social Influence and Risk Assessment Cues on User Conversion in Gam(bl)ified Digital Business Models

Information systems (IS) research that examines individual user-system interaction naturally relies on human cognition, judgment, and decision-making. Accordingly, this branch of IS research has employed psychological theories since its inception. However, only in recent years have IS researchers started to investigate how insights from cognitive psychology, social psychology, and behavioral economics can be leveraged within IS design. Especially the utilization of cognitive biases in combination with gamification currently attracts a lot of research attention. Both concepts aim at designing IS in a way that motivates users towards a target behavior. Despite calls for IS research on gamification to leverage insights from behavioral economics and social psychology in the context of gam(bl)ified IS (i.e., IS that use game/gambling design elements for non-entertainment purposes), there is only sparse research investigating how information cues can address cognitive biases to affect outcomes within gam(bl)ified IS. To advance the emergent research in these connected fields, this thesis investigates how information cues embedded in user-interface design elements can account for two important categories of cognitive biases regarding their influence on user behavior. More specifically, this thesis examines how information cues that address social influence biases and risk assessment biases impact user conversion (i.e., the process of turning visitors into active and/or paying users) within gam(bl)ified IS. Against this backdrop, five studies were conducted and published across four articles. The first study lays the foundation for the research context and setting. More specifically, a taxonomy of gamification elements is developed and extended to account for the novel gamification-related concept of gamblification. While gamification is often defined as the use of game design elements in a non-gaming context, gamblification can be viewed as the use of gambling design elements in non-gambling contexts. Gamblification is a unique concept that can be distinguished from gamification because it additionally relies on chance-based uncertainty and user-system resource transfer. Both gamification and gamblification provide a suitable setting for examining how cognitive biases can be accounted for in regard of their impact on user behavior. This is because gamification is often concerned with social interactions (e.g., competition or cooperation) and therefore frequently relies on social psychology as a theoretical foundation. Gamification is thus predestined to investigate the role of social influence biases (i.e., cognitive biases based on social influence theory) in motivating users towards a target behavior. Likewise, the emergent gamblification research setting is intriguing for investigating cognitive biases. Due to the inherent characteristics of gamblification (i.e., chance-based uncertainty and resource transfer) particularly risk assessment biases (i.e., cognitive biases that are induced by biased risk assessment) are highly relevant in this environment. The second article is situated in a gamified IS environment and investigates the role of social influence biases in fostering user conversion behavior (i.e., user registration) on an e-commerce platform. Drawing on social influence theory, two social influence cues (i.e., information cues that account for social influence biases), namely reciprocity cues and social proof cues, are embedded in the gamification design element ‘user onboarding’ and investigated in an e-commerce setting. The article’s findings indicate that both, reciprocity and social proof, have positive direct effects on user registration. However, depending on how reciprocity is implemented, the interactive effect of reciprocity and social proof attenuates or amplifies the positive direct effect. The third article examines risk assessment cues (i.e., information cues that aim to account for risk assessment biases) positioned within the gamblification element of a ‘loot box menu’. By illuminating how these risk assessment cues can address a group of risk assessment biases, namely probability evaluation biases (i.e., cognitive biases that result from a skewed evaluation of probabilities during risk assessment) their role in affecting product selection in a digital gaming context is investigated. More specifically, drawing on prospect theory, information cues are designed to account for two different probability evaluation biases, the certainty effect and the availability bias. The study’s results demonstrate that offering users loot box menus with two different probabilities of winning a reward (i.e., the choice between two different uncertain rewards vs. the choice between a certain and an uncertain reward) may trigger the certainty effect which influences user conversion behavior (i.e., product selection). Moreover, combining these different loot box menu designs with a previous loss experience causes users to be subject to the availability bias and amplifies the certainty effect. In contrast, when users are subject to the optimism bias, the certainty effect is attenuated. The fourth and last article investigates how risk assessment cues embedded in differently designed product offerings (i.e., gamblified vs. transaction-based) in the context of a digital gaming service can address a different group of risk assessment biases (i.e., stability biases) and thereby influence user conversion behavior (i.e., user purchase behavior). More specifically, drawing on literature on decision-making under risk, information cues are designed to address two stability biases, namely the risk avoidance effect and the endowment effect. Moreover, the effect of a general personal trait that is relevant for risk assessment (i.e., risk aversion) is examined. The results reveal that a gamblified product offering (i.e., a loot box with an uncertain reward) vs. a transaction-based product offering (i.e., a loot box with a certain reward) triggers the risk avoidance effect that influences user conversion. This effect is amplified when users are either subject to the endowment effect (i.e., when they experience a previous endowment with a loot box) or when they are risk-averse. Taken together, this thesis highlights the importance of considering the role of social influence and risk assessment biases and how information cues can be designed within gam(bl)ified IS to address these cognitive biases to motivate users towards a target behavior. Moreover, the results contribute to IS research by exploring the impact of manifold information cues that account for social influence and risk assessment biases as well as context-dependent interacting variables in various gam(bl)ified IS environments. Alongside these contributions to research, this thesis provides several interesting and actionable recommendations on how to implement information cues that take cognitive biases into account. This is primarily aimed at practitioners tasked with designing gam(bl)ified IS with the goal of optimizing user conversion behavior.