Category / Users

habits

Have you noticed all the startups raising massive sums of money recently? Perhaps you’ve scratched your head wondering how a company like Buzzfeed, known for its website full of animated gifs, listicles and quizzes, just raised $50 million dollars, valuing the company at a reported $850 million. Snapchat, the messaging app known for helping teenagers sext one another, reportedly received a $10 billion valuation from its investors. Has the world gone mad?

Some industry watchers see the recent boom in seemingly trivial apps and websites as foretelling tech bubble 2.0. However, there’s much more to the story.

Our knee-jerk reaction to classify innovation as either important or frivolous is exactly why many are left aghast when previously dismissed companies reveal shocking valuations in ridiculous investment rounds.

Vitamins and Painkillers

Most people, including many professional investors, tend to put new products into one of two categories: vitamins or painkillers.

Today, there’s an app for just about everything. With all the amazing things our smartphones can do, there is one thing that hasn’t changed since the phone was first developed. No matter how advanced phones become, they are still communication devices — they connect people together.

Though I can’t remember the last time I actually talked to another person live on the phone, I text, email, Tweet, Skype and video message throughout my day. The “job-to-be-done” hasn’t changed — the phone still helps us communicate with people we care about — rather, the interface has evolved to provide options for sending the right message in the right format at the right time.

Clearly, we’re a social species and these tech solutions help us re-create the tribal connection we seek.  However, there are other more hidden reasons why messaging services keep us checking, pecking, and duckface posing.

enterprise habitSlack isn’t just another office collaboration app. The company has been called, “the fastest-growing workplace software ever.” Recent press reports claim that “users send more than 25 million messages each week,” and that the company is, “adding $1 million to its annual billing projections every six weeks.” Smelling an opportunity, investors just plowed $120 million into the company, giving it a $1.12 billion valuation.

“Our subscription revenue is growing about 8 percent monthly, before we add new sales,” says Slack’s business analytics lead Josh Pritchard. “This is, as far as I know, unheard for an enterprise SaaS company less than seven months after launch.”

Perhaps even more surprising, Slack’s user retention stands at an astonishing 93 percent. How does Slack get its users hooked?

On the surface, no single factor seems to set Slack apart from a plethora of other collaboration tools. However, a closer look using the model described in the book Hooked: How to Build Habit-Forming Product, reveals the user psychology behind the company’s success.

Screen Shot 2014-11-10 at 8.45.09 AMOn May 1, 1981, American Airlines launched its frequent flyer program AAdvantage. Since then, a flood of loyalty programs have attempted to bring customers back through rewards.

Today, you can become a card-carrying member of just about anything: hotels, supermarkets, drugstores and pizza chains. If you’re in a store, chances are someone will ask, “Would you like to join our rewards program?”

Marketing professors, store managers and executives are still not sure how effective these initiatives are. One puzzle is the link between participation and loyalty. It’s not that strong. Millions of Americans are enrolled in at least one loyalty program, but just a fraction of them are dedicated customers. Typically, loyalty programs work only to the extent that they reward customers who are already loyal.

product psychology

I do quite a bit of research, writing, and consulting on product psychology — the deeper reasons underlying why users do what they do. I also frequently teach and speak on the topic. Invariably, after each talk, someone approaches me and asks, “That was very interesting. Now where do I learn more?”

I’m never sure what to say, since there’s so much great information available. What this person really wants to know (and I’m assuming you do, too) is where all the really good stuff is. They want to know the highlights, the takeaways, and the methods and techniques that can help them be better at their careers, build better products, and ultimately improve people’s lives.

That’s why I’m proud to announce a new online course called Product Psychology. This free course taps into the collective wisdom of some of the brightest minds in the field to help you better understand user behavior. They’ve taken the time to dig up their favorite articles, videos, and resources to get you up to speed quickly. Best of all, lessons are sent free via email.

Nir’s Note: This post was co-authored with Stuart Luman, a science, technology, and business writer who has worked at Wired Magazine, the Bulletin of the Atomic Scientists, and IBM.

MAKING WORK INTO A GAME HAS ITS CRITICS. IS THIS A PRACTICE WORTH KEEPING?

11550024626_8a0284ef2a_bIn the never-ending effort to motivate employees, companies are taking cues from video games–adding scoring, virtual badges, and other game-like elements to everyday work processes to make jobs more fun.

Some proponents insist that one day every job will somehow be gamified, while detractors fear it’s just another management fad or worse, a sinister new form of corporate control.

To weed through some of the hype, here are four pros and cons to gamifying the enterprise.

The Good

1. GAMIFICATION INCREASES EMPLOYEE ENGAGEMENT

The most often cited reason companies try gamification is to improve employee motivation. Apparently, there are a lot of workers who need the extra boost. According to a 2013 Gallup poll, 70% of U.S. workers reported themselves as not being engaged in their jobs.

Nir’s Note: This guest post comes from Marc Abraham, a London-based product manager. In this article, Marc reviews the recently published book Designing for Behavior Change by Stephan Wendel. Follow Marc on Twitter.

Designing for Behavior ChangeBehavioral economics, psychology and persuasive technology have proven to be very popular topics over the past decade. These subjects all have one aspect in common; they help us understand how people make decisions in their daily lives, and how those decisions are shaped by people’s prior experiences and their environment. A question then arises around what it means to change people’s behaviors and how one can design to achieve such change.

Stephen Wendel, a Principal Scientist at HelloWallet, has written Designing for Behavior Change, which studies how one can apply psychology and behavioral economics to product design. In this book, Wendel introduces four stages of designing for behavior change: Understand, Discover, Design and Refine (see Fig. 1 below):

Recently, I started looking into the explosively popular new game Kim Kardashian: Hollywood. The game has ranked at or near the top of Apple’s U.S. App Store charts for the most downloaded free game. Industry watchers say the app could gross $200 million annually and net Kardashian a sizable chunk of the game’s profits.

My line of work is researching what makes some products so compelling and in the case of the Kardashian game, I wanted to know what was behind the app’s phenomenal growth.

I soon discovered that one potential driver of all of its installs is a rather sneaky tactic that exploits user error and can unwittingly post messages to players’ Twitter accounts.

It’s called the “viral oops.”

Unlike viral loops, which are actions users take in the normal course of using a product to invite new members, viral oops rely on the user ‘effing-up.

Nir’s Note: This guest post is by Dr. Marc Lewis, who studies the psychology and neuroscience of addiction. After years of active research, Marc now talks, writes, and blogs about the science and experience of addiction and how people outgrow it. Visit his website here. 

Xbox 360 ControllerYou’ve just obliterated the last seven or eight zombies. It was a narrow escape and you’re flushed with satisfaction. But you didn’t see that horrendous creep, weaping sores and oozing  pus, because he was hidden behind the dustbin in the shadow of a bombed out building. You get slimed, you’re dead. Or worse than dead. So you touch the “play again” bar at the bottom of the screen. Now you start further ahead than last time. You know you’re going to meet the slime-master again. Soon. Be prepared.

Or you’ve crossed the desert and scaled the abandoned fortress, nearly to the top, moving along pathways that require hair-trigger adjustments with your joy-stick. But the wind is getting stronger by the second. It keeps pushing you back along the path, dangerously close to the edge. You make a daring dash between gusts. But you miscalculated, and the force of the wind blows you right off the edge. Down you plummet, to a plateau you crossed minutes ago. Now you have to make that climb again. But do it better. Get it right.

Nir’s Note: This guest post comes from Marc Abraham, a London-based product manager at Beamly. In this article, Marc reviews the recently published book “Designing Multi-Device Experiences” by Michal Levin. Follow Marc on Twitter or check out his blog.

book coverWe live in a world where the number of connected devices is growing on a daily basis at an immense rate, with people constantly switching between these devices (PCs, smartphones, tablets, TVs and more). The question arises how we can design optimally for a device to be used together with other devices.

Michal Levin, a Senior User Experience Designer at Google, has created a framework which aims to capture the interconnections between different devices. Levin calls this framework an “ecosystem of multi-connected devices.’ The underlying goal behind this framework is to enable designers and product creators to “understand the different relationships between connected devices, as well as how individuals relate to them.” As a result, companies can create natural and fluid multi-device experiences for their users. Levin has written about the fundamentals of this ecosystem in her book Designing Multi-Device Experiences.