Stephen Wendel's & Zarak Khan's presentation at Action Design DC on 12 August 2014, giving an introduction to behavioral economics and how it can be applied to product design.
Behavioral Econ 101 for Product Design - Action Design DC 12 August 2014
1. Behavioral Economics 101
For Product Design
Action Design DC
August 12, 2014
Steve Wendel (In: sawendel) Principal Scientist, HelloWallet
Zarak Khan (In: khanzarak) Senior Consultant, Booz Allen
15. What’s Behavioral Economics?
Core Lessons for Product Design
How Habits Fit In
Behavioral Methods for Product Design
Next Up – Core lessons for product design
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28. What’s Behavioral Economics?
Core Lessons for Product Design
How Habits Fit In
Behavioral Methods for Product Design
Next Up – How Habits Fit In
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35. What’s Behavioral Economics?
Core Lessons for Product Design
How Habits Fit In
Behavioral Methods for Product Design
Next Up – Behavioral Methods
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36. A philosophy and a method
There are no magic wands.
We’re always wrong.
Experiments can make us less wrong.
40. With experiments – A/B, RCT, ABC, etc.
Controlled Experiments:
The Gold Standard
Statistical Models w/ Controls
41. Summary
Behavioral econ: uses economics &
psychology to understand quirks of behavior
We’re all fundamentally limited;
design accordingly
Users are often on autopilot (habits, etc.)
Assume you’re wrong
and rigorously test interventions
45. Figure out what to change / try
Component: To Do This: Try This:
Cue Cue Action Tell the User What The Action Is
Increase Power of Cue Create Clear Affordances
Increase Power of Cue Clear the Page of Distractions
Reaction Increase Trust Make Site Beautiful and Professional
Increase Interest & Trust Social Proof
Increase Interest & Trust Display Strong Authority on Subject
Bypass Automatic Rejection Be Authentic and Personal
Evaluation Increase Motivation Prime User-Relevant Associations
Increase Motivation Loss Aversion
Increase Motivation Peer Comparison
Increase Motivation Peer Competition
Increase Motivation Make the Rewards Vivid
Decrease Costs Default Everything
Decrease Costs Lessen Burden of User Action (cheat)
Decrease Costs Reduce information required for user to proceed (simplify)
Decrease Costs Avoid choice overload
Ability Increase Logistical Ability Implementation Intentions
Decrease Resource Constraints Automate
Increase Sense of Feasibility (Self-Efficacy) (Positive) Peer Comparison
Time Pressure Increase Urgency Frame text to avoid temporal myopia
Increase Urgency Remind of prior commitment to act
Increase Urgency Make it scarce
Increase Urgency Make it time-sensitive
48. Want more?
$99 for first 25 people
who use code “be_dc”
$150 for the next 50
$250 -> $400 for the rest
Capped at 400 people
www.designforaction.org