“What are you going to spend it on?” I asked my 15-year-old cousin, who had just received a £50 Xbox gift card. He already had it all planned out — he’d convert the money into Apex Coins, the in-game currency of online shooter Apex Legends. This game is free to play but offers all manner of opportunities for players to fritter away cash, including buying “Apex Packs”, which contain three random items. You don’t know what you’ve paid for until you open the loot box.
I watched as he opened 100 boxes, each accompanied by audiovisual pyrotechnics reminiscent of slot machines. After investing £50, he only received a single rare item, and even that was a repeat of something he had already. I couldn’t help feeling this was money down the drain. At his age I might have used that money to buy a new game which would provide hours of fun — though I did also buy Pokémon cards, the loot boxes of my era, which often contained little of value.
Loot boxes such as those in Apex Legends are at the centre of a heated debate that has prompted legislative action in Europe and Asia. Critics say they are unethical and exploitative, little more than gambling for children. Yet the underlying mechanisms that make loot boxes so alluring can be found in many games, employed as tools to keep players engaged. In this form they are mostly benign. How do game developers draw on behavioural psychology to get players hooked? And at what point do these techniques cross the line into exploitation?
In a sense, a video game is a manipulation system, designed to anticipate and guide our behaviour and keep us playing for tens, even hundreds of hours. Though people play games for diverse reasons, they are all in some way motivated by rewards, which come in two varieties. “Intrinsic rewards” are derived from the pleasure of direct interaction with the controls and game world — performing actions because the actions themselves are fun. “Extrinsic rewards” elicit pleasure from working towards longer-term goals. Both are essential to a game’s longevity.
Developers layer these to create a “reward cycle” (also ominously named a “compulsion loop”), a chain of activities designed to become repeated and habitual and which elicit a dopamine hit. You want the cadence of rewards to be neither too frequent nor too rare, because a badly designed reward cycle can frustrate and demotivate a player. Developers often adopt a schedule known as “variable ratio reinforcement”, which suggests that people are more compelled by an unpredictable pattern of rewards rather than a regular one.
Most games interlace short, mid- and long-term rewards that trigger at different times. The short-term rewards often take the form of sensory feedback: the bright “ding” when you get a coin in Super Mario, an enemy’s head exploding in a shower of gore in Grand Theft Auto or the tactile feedback of vibrations from your controller. These get boring after a while — behavioural psychologists learned that repeating the same rewards generates diminishing returns. So developers offer midterm rewards: new levels, items, skills, characters, locations or narrative beats. The long-term rewards are often related to social competition and prestige, such as difficult high-level team challenges or rare cosmetic items which players can show off to their friends.
Loot boxes lean into several of these techniques. They have been employed in all manner of games ranging from Fifa to Star Wars, and they’re very profitable. Yet they have also faced a backlash: a recent report from consumer bodies in 18 European countries called them “exploitative”. Although they have been banned in Belgium since 2018, most governments have been wary of legislation — the UK recently decided not to ban loot boxes after a 22-month consultation. Still, some developers have heard gamers are unhappy — loot boxes were removed from Star Wars Battlefront 2 after an outcry and Blizzard recently announced that they won’t feature in upcoming shooter Overwatch 2.
There is a difference between the reward cycles developers employ to keep people playing and loot boxes. The former are in the service of fun, intended to make players feel compensated for their investment of time and skill. The latter are purely for profit, rewarding players seemingly at random. They remind us that the qualities that make games so powerfully compelling can become unethical when their implementation prioritises profit over respecting the player.
I asked my cousin whether he’d spend his money the same way given another chance. He looked at me with the superb scorn that only teenagers can muster and shrugged. But I knew what he was thinking: don’t hate the player, hate the game.