The primary difference between gratification and reward is the timing of the need fulfillment. If the need is satisfied during the activity, then the player experiences gratification. If the need is satisfied as a result of the activity, the player feels rewarded. A well-designed game will satisfy the player’s needs through both methods at the same time, but many needs are more sensitive to one or the other.
Gratification
The need to demonstrate competence, especially competence under low-pressure circumstances, is an aspiration best met through gratification. Because competence is theoretically achievable by every player, it feels hollow to follow a demonstration of competence with praise, loot, or some other form of reward. Successfully following instructions and getting through a tutorial hardly seems like much of an Achievement. In fact, by the time the reward is awarded, the player’s need to display competence has already been met, so the reward feels like an afterthought, the over-enthusiastic encouragement of a parent at a soccer game.
Thanks for the support, Dad
Gratification, on the other hand, happens at the moment of execution and amplifies the player’s experience of meeting their need for competence. The audible pop as an enemy’s head explodes from a headshot, the giant red number floating up after a critical strike, or even the silence of a battlefield after the final attacker is defeated, all of these enhance the moment of success. They make it more gratifying. Even activities that take virtually no skill at all, but only require the player to do an obvious, trivial task, can be made gratifying by the right sounds and visuals. In some games, the “Press Start” screen is empowering and need-fulfilling.
Rewards
Some needs are better met by rewards. These can either be something the player expects and has been building toward, or an unexpected acknowledgement of something the player has achieved, but are always awarded after the activity is finished so the player can fully appreciate them. Usually it is a good idea to slow the pacing and provide a lull for them to bask in their accomplishment. Rewards generally ought to be something useful, but since they are highlighting the fact that a need has been met, they can simply be a trophy signifying that event.
Worth an achievement
Although it is very similar to demonstration of competence, the need to demonstrate excellence is better suited toward rewards than gratification. Perhaps the method that a player used to get the final kill in a multiplayer game wasn’t that special, and there is no need to add spectacle to enhance the death itself, because the real reward is a slight delay followed by the announcer saying “Team Eliminated” and the winner’s rank going up. Picking up the loot from a downed boss doesn’t need much in the way of effects and sounds because the items themselves are the rewards for an excellent display of skill. Xbox Achievements and Playstation Trophies are better used for rewards for excellence precisely because they aren’t that gratifying and feel awkward when awarded for more mundane accomplishments.
[To be continued]
Rewarding Play 
“These can either be something the player expects and has been building toward, or an unexpected acknowledgement of something the player has achieved, but are always awarded after the activity is finished so the player can fully appreciate them.”
This sentence got me thinking. You break rewards down into two broad categories:
A) Expected rewards
B) Unexpected rewards
Is it reasonable to assume that A is more satisfying than B, but can also be more dangerous?
It is certainly more rewarding to win $500 in an essay contest or sports tournament than in a random lottery. Defeating a difficult boss to get a rare item is arguably more satisfying than getting it from a low-level enemy’s random drop. The danger comes in accidentally designing a reward that negatively influences player behavior. Achievements can certainly be crafted to encourage players to try game features and techniques they otherwise wouldn’t bother with. But what if teammates are betraying each other over achievement-related weapons? Either the value of the reward is too high (e.g. gamerscore, XP) or the reward criteria needs to be adjusted (say, “Earn 100 kills with the sniper rifle” vs. “Earn 20 sniper kills in one game.”)
Are there cases where gratification and reward are more closely mixed together?
The best thing I can think of is in-game progress bars. Every kill you earn towards that challenge gives you the instant gratification of hearing and seeing a new tick on the progress bar. The Call of Duty series took this to the extreme beginning with Modern Warfare: the moment you earn enough XP to rank up a loud cheer/shout is heard and the new rank icon brightly flashes. The actual rewards for the promotion (new guns, perks) aren’t granted until the post-game lobby, a system I think works well at satisfying players (and is not exclusive to Call of Duty.)
Sorry if all of this is covered in “Rewarding Play III”, I just thought they were interesting things I considered after reading your post.
Love the blog, by the way. It took me a week of lunch breaks to catch up on everything, but it was a very interesting read. The writing style and examples are clear enough even for someone that isn’t in your intended audience (I’m an Aerospace Engineer working outside of the gaming industry.) Looking forward to more posts (and Design in Detail slides!)
A good general rule of thumb is that you should use “expected” rewards to guide players toward an activity and “unexpected” results to reinforce an activity they are already enjoying. Both of them can be equally rewarding, but only a reward the player knows about and expects can steer them toward a particular behavior. Of course, in the age of the internet walkthrough, there is no such thing as an “unexpected” Achievement, and even loot drops are matters of percentages and not truly surprising.
You’re right on about MW overlapping gratification and rewards with their XP system. It’s a great example of both. Not bad for someone outside my intended audience. ;)