Imagine a world where every TV commercial, print ad, billboard, and social media campaign is no longer just saturating you with brand logos, messages, and videos like a couch potato. Instead, imagine that it starts to look and feel more like an interactive game. Marketers have been using gamification for some time, but new immersive technologies such as augmented reality and the Internet of Things (IoT) are about to make this much more potent.

This hyper-engaging world is rapidly coming, and it’s going to give advertisers a superpower they’ve never had before because the ability of gamification to incentivize and change human behavior while simultaneously entertaining the audience is vastly more powerful than any tool in the traditional advertising arsenal. But this new power is a double-edged sword. Will advertisers take the high road and choose to delight customers, or will they take the low road and instead use these tools to manipulate and abuse them?

Manipulation of gamification

One of the classic examples of powerful gamification is Zynga’s Farmville. It implemented what is known in the industry as the “harvester mechanic” to great effect. People were setting their alarms to wake up at 1:30 a.m. to harvest their digital blueberries. That you can use these tools to get people to disrupt their own sleep cycles is remarkable, and although this is not an ad, it illustrates the incredible potential of gamification as a tool for sculpting consumer actions.

There are many more examples of effective game mechanics, but McDonald’s’ Monopoly promotion notwithstanding, these tools have largely only been available to the video game and software industries, which use them to make their games fun and, according to the World Health Organization, addictive. However, new AR and IoT breakthroughs are about to bring this superpower to advertisers at scale. For instance, pro sports teams have already made their big screens interactive through the use of augmented reality, and it’s only a matter of time before the screen in your living room can do this. The catch is that there are two types of gamification design: White Hat and Black Hat.

What color is your hat?

White Hat gamification is positive, fun, and inspiring. It has the potential to make advertising much more valuable to consumers by engaging, teaching, and entertaining them. Right now, advertising is inherently interruptive and doesn’t really offer any value to us, but White Hat gamification will change this. It’s based on positive ideals and outcomes that civilization cherishes, such as meaning, accomplishment, creativity, empowerment, problem solving, and storytelling. It’s uplifting and speaks directly to the cerebral cortex, the higher part of our brains which makes us enjoy poetry and strive for self-actualization. Some examples include solving tricky puzzles, self-expression in a digital world, leveling up, and achievements such as those implemented by the Nike Fuel Band and similar fitness-promoting devices.

By contrast, Black Hat gamification is darker and more manipulative. Instead of speaking to the higher parts of the human brain, it speaks to its limbic and reptilian portions by engaging mechanisms such as avoidance, scarcity, uncertainty, and fear of punishment if you don’t succeed. Countdown timers are a great example of Black Hat gamification. They’re extremely effective, but only because they successfully apply pressure and stress by engaging a sense of scarcity and loss that manipulates our basic instincts. Random rewards such as gambling on slot machines and loot drops in video games are other great examples of Black Hat gamification designed to engage us through similar manipulation.

So why doesn’t everyone just use White Hat gamification all the time instead of its Black Hat counterpart? The problem is that Black Hat gamification is much easier to design and deploy. Black Hat game dynamics are often simple and can be created by advertisers even if they don’t have much skill in the art. White Hat gamification, on the other hand, generally requires more creativity and thoughtful design in order to get it right. The temptation for advertisers will therefore be to take the low road and use gamification to manipulate rather than to uplift and inspire.

The dark side

Should advertisers choose to go the Black Hat route for consumer outreach? If ethics are a priority, this decision is very simple: DON’T DO IT. Yes, you’ll be able to make a quick buck and win some short-term success by embracing the dark side of gamification over new augmented reality channels, but over the long-term that’s not a winning strategy. Black Hat tools such as countdown timers will work really well at first, for example to drive traffic to a store before a sale ends, but ultimately your customers will feel manipulated and will come to resent the brands you represent. Black Hat gamification is effective but it creates stress, potentially deteriorating your audience’s mental, emotional, and physical health. Instead of creating cheap moments, it’s far better to build lasting, positive memories through White Hat means.

This isn’t to say that you shouldn’t use Black Hat gamification at all. In fact, it can be a lot of fun if used properly and if it’s not overdone or abused. For instance, it can be used effectively to support an overarching White Hat campaign, such as a countdown timer in a fitness app which ultimately serves a greater White Hat achievement-based narrative. Just be aware that if your ads use too much Black Hat gamification, then you’ll burn out your customers and will ultimately lose to the agencies and brands that have mastered the more positive White Hat art. You want to build loyalty programs in which customers love your brands, and not “mercenary programs” where they feel compelled by their reptilian brains and eventually hate the experience when they realize they’ve been manipulated.

This is why AR and the IoT are going to radically change the face of advertising by making it vastly more interactive. Instead of treating consumers like passive observers with a barrage of incoming messages, logos, and videos, these new technologies will turn audiences into passionately-engaged participants by enabling the use of powerful interactive game mechanics.

However, the two-faced nature of gamification means that advertisers will soon have to decide how to use these powerful new tools. We’ll definitely see a gold rush in this direction, but at the end of the day, advertisers should consider what’s best for the customer. Will they embrace the new powers of AR and the IoT to to implement higher White Hat ideals and build a world that is based on creativity, problem solving, and storytelling? Or will they resort to means that manipulate our lower instincts in order to make a quick buck? One thing is for sure: We don’t want marketing to end up looking like this.

Yu-kai Chou is the author of Actionable Gamification: Beyond Points, Badges, and Leaderboards and is considered to be one of the world’s foremost experts on gamification.

The co-founder and CEO of Xperiel, Alex Hertel completed his Ph.D. in computer science at the University of Toronto and is an expert on the use of immersive technologies to make the physical world digitally interactive.