My latest video overview of the “Hook Model”. Slides below video.
This week, Baba Shiv and I taught a class at the Stanford Graduate School of Business called, “Using Neuroscience to Influence Human Behavior.” The course focused on the science behind how consumers make decisions.
During the class, we walked through my Desire Engine framework, a four-step cycle that creates preferences and usage habits. Readers of my blog will be familiar with the model but I wanted to share some slides regarding one particular part of the Desire Engine, the “investment phase”.
This phase involves customers doing a bit of “work”, which commits them to the usage of the product. Investment makes re-engaging with the product more likely, and with the slides below, I try to explain why.
Slides from the Investment Phase discussion are below and I apologize for not having a voiceover to go with them yet. I’ll be writing more on this topic in the coming weeks but wanted to share some of the research into the topic.
Also, more slides from the class are available on my Scribd page here.
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I was honored to present at WordCamp this year but had to make do with the small amount of time allotted. I crammed my talk into a very short intro to the Desire Engine that sounds like I’m talking while on fast forward. Enjoy!
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Step 1: Build an app. Step 2: Get users hooked to it. Step 3: Profit. It sounds simple and, given our umbilical ties to cell phones, social media, and email inboxes, it may even sound plausible. Recently, tech entrepreneurs and investors have started to look to psychology for ways to strike it rich by altering user behavior. Perhaps you’ve read essays on how to create habit-forming technology and figured you’d give it a shot?
Well hold your dogs Pavlov! Though I’m an advocate for understanding user behavior to build high-engagement products, the reality is that successfully creating long-term habits is exceptionally rare. Changing behavior requires not only an understanding of how to persuade users to act — for example, the first time they land on a webpage — but also necessitates getting them to behave differently for long periods of time, ideally for the rest of their lives.
The good news is that that companies that accomplish this rare feat are the ones associated with game-changing, wildly successful innovation. Google, Apple, Twitter, and Android come to mind. As we enter a world where, according to Paul Graham, everything is becoming more addictive, the companies that successfully form and control habits in the future will come to dominate the industries of tomorrow.
But claiming that habits are the keys to success is a tall order. If people like me provide ready-made formulas and guidebooks on how to create habits, why isn’t every company that alters user behavior succeeding?
Video from my recent talk at the Designers + Geeks Meetup in San Francisco on August 1st, 2012.
Note: This talk is similar to my “Behavior by Design” talk but has approximately 20% new material.
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This week, fans packed stadiums in London wearing their nation’s colors like rebels ready for battle in Mel Gibson’s army. They screamed with excitement and anguished in defeat. Many paid thousands of dollars to travel around the globe to be there.
What the hell is going on here? How do sports engage, delight, and motivate people to put their lives on hold and become totally engrossed in watching other people play games? If sports can motivate people to go to great lengths, can businesses learn to instill the same loyalty and passion in their customers?
In fact, the psychology that makes fans do crazy things in the name of their team can be harnessed to turn people into avid users. Innovative companies are minting habitual customers by understanding the mechanics of human behavior. Here are a few examples of the psychology of sports and the companies who have learned to exploit these same principles:
For a stunning example of customer loyalty, look no further than the fans of the heartbreaking Chicago Cubs. The team suffers from “the longest drought in North American sports,” 104 years without a World Series win. Yet, despite the century of defeat, Forbes magazine rated the team as having the 4th most loyal fans in baseball.
Before you can change the world, before your company can IPO, before getting millions of loyal users to wonder how they ever lived without your service, people need to on-board. Building the on-ramp to using your product is critical in every industry, but few more so than in the ADD world of web and mobile apps. Distractions are everywhere, vying for user mindshare and threatening to pull them off the road to using your products like the donut shops and strip clubs at a trucker’s rest stop.
However, done correctly, the on-boarding process can be the first step in creating strong user habits. Products that create repeat behaviors tend to follow a consistent design pattern of a trigger, action, reward, and investment, which I’ve described as the Desire Engine. This pattern is effective when used to craft behaviors that the designer intends to be repeated regularly. The on-boarding process can be the first of several passes through the Desire Engine.
The first step is bringing users in. But a successful trigger is much more than just a way to drive traffic, it’s an opportunity to start imprinting new routines. Josh Elman, an early product manager at a string of successful companies, including LinkedIn, Facebook, and Twitter, describes this as the point of “inception”– yes, like the movie. “Inception is about implanting an idea about why and when the product is useful for someone.” Since a user’s first awareness of a product depends on an external trigger, such as a call-to-action in an email, a link on a social media site, paid advertising, or a word-of-mouth recommendation, the message must be consistent. “People need to talk about your product the same way, each and every time,” Elman says.
The belief that products should always be as easy to use as possible is a sacred cow of the tech world. The rise of design thinking, coinciding with beautiful new products like the iPhone, has led some to conclude that creating slick interfaces is a hallmark of great design. But, like all attempts to create absolute rules about how we should interact with technology, the law that design should always decrease the amount of effort users expend doesn’t always hold true. In fact, putting users to work is critical in creating products people love.
Several studies have shown that expending effort on a task seems to commit us to it. For example, when buying a lottery ticket, players are able to either choose their own numbers or play a set of digits generated randomly. Certainly, choosing either option has no effect on the odds of winning. Traditional thinking would predict that the less effortful path would be the one users prefer.
However, the opposite is true. Despite the considerable effort required to pick the lottery numbers, a process reminiscent of filling out multiple choice questions on the S.A.T., players who choose their own numbers play more. This phenomenon isn’t just about a skewed perception of luck. According to a classic study by Ellen Langler, even when players are explicitly told their chances of winning, they choose to trade worse odds for the ability to play the numbers they spent the time and effort picking.
This presentation of my “Behavior By Design” talk was made possible by Innovation Endeavors, an early-stage venture fund in Palo Alto. Thank you to the Innovation Endeavors team for hosting me.
Also, special thanks to Paula Saslow for the fantastic video production.
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Right now, someone is tinkering with a billion dollar secret — they just don’t know it yet. “What people aren’t telling you,” Peter Thiel taught his class at Stanford, “can very often give you great insight as to where you should be directing your attention.”
Secrets people can’t or don’t want to divulge are a common thread behind Thiel’s most lucrative investments such as Facebook and LinkedIn, as well as several other breakout companies of the past decade. The kinds of truths Thiel discusses — the kinds that create billion dollar businesses in just a few years — are not held exclusively by those with deep corporate pockets. In fact, the person most likely to build the next great tech business will likely be a scrappy entrepreneur with a big dream, a sharp mind, and a valuable secret.
I believe secrets about human behavior, which provide insights into the way people act even though they can’t tell you why, are levers for creating user habits and competitive advantage. These kinds of secrets are also relatively cheap to uncover but can be the basis of massive enterprises.
Once, only large companies had the resources to discover monetizable secrets. Throughout the twentieth century, companies like GE, Dupont, Chrysler, and IBM specialized in discovering the optimal form of physical goods and their insights lay largely hidden in the discipline of industrial design. For these companies, uncovering secrets required massive R&D investment to find the best way to create a better, cheaper, or faster product.