With Great Addiction, Comes Great Responsibility

Raymond Dellar at Product 2020

Transcript
Accessible Slides

(upbeat music)- - Thanks everyone for coming to the Web Direction Summit, and we'll dive straight into habitual dependence and gamification in products. So my goal for this session is really to try and educate you on that habitual loop, display where it's being used and how effectively. The good versus evil in that addiction and those long-term effects and legal factors that can come from that. And then lastly, hopefully answer any questions you might have as well. So we'll dive straight in with the habitual dependence. So initially, it ties in with what we call the pirate metrics. Now you may have seen these before, but it's really a flow through your product and how customers will get into that retention loop, and also hopefully by revenue and refer all this across. So the acquisition which you can see initially on the left there, is really about getting customers into the product, while retention is really about holding them their, activation is about getting them involved, revenue, obviously buying something. And then that referral vitality is the best outcome where they're actually spreading your message around. So if anyone's wondering why it's called pirate metrics as well, if you look through acquisition, activation, retention, revenue, referral, it spells out our ()laughs so why do we actually need this? And a lot of you would have seen the drop off rates that customers have as they move through a product. So initially, you'll have 100% of those total sessions, but as you keep moving through that flow and actually move to the product page, we have to actually adding things to cart and purchasing, it drops off to around 3% by the end of it. So we need a way to draw those customers back in, perhaps with that earlier, and just all the things in the mind, or may have been distracted. So how can we do that? So initially, this idea of the habitual loop was brought about very early on, and we'll get to that shortly. But initially where it's being used today is voicing every product you could think of, it's with McDonald's, Facebook, even baseball cards, and any trading cards you can think of. And it's how it brings you back to those companies, brings you back to those products and keeps you addicted and keeps you coming back each time. So where did it start? As I mentioned, it originally came about in the early 1900s or so, back in the days when the psychology ethics was already a bit looser than it is today, and was brought about by Skinner. So you may have heard of the Skinner's box before, and this is where a lot of it ties in. But it's really around the idea of operant conditioning, which is sort of the scary word of how to get someone into a bit of a loop and actually get the dopamine levels spiking at the right times you want them and therefore coming back when you need them to. So how did he do this? So initially he did the test with some mice in a cage, and effectively had achieved a light. The light would come on and the cheese would come out, and roughly every second time it pressed the lever, the cheese would come out and light would come on. Now in this first effect on the left hand side, that fixed ratio. In that first scenario, we found that the actual, the rat would go about its normal scenario, eat the food it needs to, and once it was full, would leave it. However, they did the test again, and this time kept the ratio, it was still every second time, but made it variable, so effectively randomising it. So, no cheese two or three times in a row, then cheese, maybe twice, then non, and so on. And what they found was that the rat kept going and kept getting the cheese until it literally ended up making itself sick. So there was definitely something very different in the scenario, making it more variable rather than that fixed ratio, which you might start to see patterns in products right now. So I'll lead you into the actual loop of what it is first, and then I'll give it a sort of a bit of a summary of how it all works. So the first step is the trigger. So the trigger is the thing that gets you thinking about that product or whatever it might be. So there's two types of triggers, there's internal, which are your internal mechanisms. This could be boredom for playing a game or jumping on Facebook, or even hung up is an internal trigger to get you to go up and eat something. While most of us are probably more aware of the external triggers, so this is your billable as you driving, even a notification on your email or text screen is a trigger to make you come in and look at it. And then probably one of the most effective external triggers is referrals from other friends you've talked to and people that recommend things, as we often know. So you get this trigger and then it brings you through to whatever that might be. And then you get into what's The next step, is the routine. Now the routine is often arguably the boring part. This is the part where you're going through the motions, looking for something that you want. So a good example on the top left there, might be Instagram or Facebook. And in those circumstances, it's the general scrolling that you just doing until you can find a post that excites you, or maybe someone's messaged you, something like that. Even similar with Spotify, where I use a lot of the discover weeklies and release radars, and that in itself is that routine of going through there every Friday to see if there's anything new or exciting. Candy crush, it could just be playing in a game, and probably one of the most effective ones since the current scenario is actually Netflix, where the routine of Netflix is probably that scrolling through, you just inherently open up Netflix because you're bored, and that scrolling through the movies and TV shows to find out what's there. So that's the routine we fall into. Now with the routines, there is an important element of the ability and the motivation. So really this is the motivation, further up is how motivated you are to achieve this goal, while further down on the x-axis, I'm sorry, y-axis, is more around the lack of motivation, and you have no interest in doing so. While the ease along the bottom is really how easy it is to use that product or try and get what you're after. So you can see quite easily based on how high your motivation is, you're willing to do as much as you need to get that trigger. Although if it's impossible, it's still not gonna work. Similar, even if your motivation is quite low, as long as it's not nothing, if the ability and ease is very, very simple, people will probably click through and have a look at it anyway. Think a good example might be emails or something like that, where it's just pull down from the top a lot of the time, you can see the email notification, not an interesting email, but I'll quickly have a read because it's just one tap. So you can see how the actual motivations and ability to just ties in quite a lot with the routine motivations and the triggers. So they've gone through the routine, now you get your reward, and we'll touch on that variability aspect in a moment. But generally the reward is often broken down into there's three areas that tie back lots to our biological roots, maybe it's still around today. So the first being the reward of the tribe, and that's often that community reward, this could be working in a company and actually progressing things for that community, it could be family, it could be anything that, could be even just that social interaction is a reward within that community. While the reward for the self is often around improving oneself individually. So this in today's styles could be musicianship skills, could be anything around that side, that's improving your internal measurements or even external around improving oneself. And then the hunt is really about those external rewards. So in today's day and age, while it may have been hunting a long time ago, today's day and age, that hunt reward is often money or income or something you've wanted for a while. And so that's how we'll often break down those three general rewards, and you'll find that certain rewards will affect other people individually more or less so. So why does this process work? When you have the reward, you go through the triggers and so on. Well basically, initially when they were first doing this test, you can see the initial run through that's basically a click the scenarios, in this case, it's the chocolate for an individual, clicking the options and get the chocolate, not much of a change in dopamine levels. However, on the right hand side, you can actually see where once they started getting into these variability of the rewards, and not that guaranteed reward, but are variability, you would get a spike on the trigger. Then during the routine, your dopamine levels would drop to a pretty much an all time, like almost low of just like mind numbing, okay, just doing my action, you're almost not thinking at all, until you reach that reward and you end up getting another massive spike. And you can probably start to see how this becomes a bit predictive when it's using your dopamine levels. So then the arguably most important step of this loop is you've been triggered, you've come in, you've made the action and you're being given some sort of variable reward. Now really the most important part, and this is where a lot of companies or products will drop off is the investment. So the reason the investment is so strong is this is the reason you come back to that particular product. Now, one of my favourite examples of investment is probably McDonald's where lots of parents may even notice this, where a trigger for McDonald's might be obviously an ad or even just the kids getting hungry. The routine is actually going, and for the kids, the routine is actually eating the meal. Now the variable reward, as many parents would know, would be the collection of toys, so, the toy you get with the happy meal. However, the investment comes in and this is where it's very smart, is that toy is now a collection of one of six toys. Maybe it's one of the Avengers. Now you've got to go back each time and try and get the other toys. But however, there's a variability to it, because you don't know if when you get the next McDonald's toy, if it's gonna be the same one you've already gotten, or you've missed one in between. And so now the kids wanna go back, and really smart part is, that toy in itself becomes another trigger because now when the child is playing with that toy, the first thing they think of is, "Oh, I wanna gonna go back and get the other one for it as well." So that becomes a trigger to lead to the next routine, and so on. So your best investments are the reasons you come back to that product, like can be your Facebook or even Apple as a product. And the reason you go back is because I've got so much history there now, I can't change off it, but so many friends I'd love to change to from iMusic to Spotify or vice versa, but I've got all my playlist there, it would take too long to move everything. So if that investment that ends up drawing it back in. And then hopefully, you get those investment returns. So this is an example of like, Dick Smith, where they've exploded recently during the COVID pandemic to actually become a bit more effective again, as they were dying off as a retail brand. However, the online capability has exploded and they had a really good investment return, which I noted, which was I ordered a product there recently, and then a few years later, it was offering me a discount card, 40% off of a different product I was looking at with a unique code to myself. So that became an actual investment for me. I was like, "Oh wow, I actually have an investor reasons return to Dick Smith to purchase my next product," and go through that routine, maybe find something I want to get that variable reward. So as you can see, the loop really ties in with those triggers, internal, external, makes you go into the action of that routine, get the reward, and then hopefully that will build in another investment which causes the next trigger to actually stopped drawing around. You can see how you then start getting stuck into these loops, and you'll see it in every front. So what sort of effects does this have on the real world? So there has been some obvious bad use cases in the past, probably two of the, one of the largest major examples is probably a term of loop boxes, which you may have heard before. So loop boxes work effectively on this premise, that it gets you to go through the routine of playing a video game, whatever it may be. And then the reward is the, obviously the loop box. Now, general ward would usually be like, oh, you've got a new gun or a skin for your character. But instead they give you a chance of getting variable rewards. And this like this change was probably kicked in, roughly I'd say five to 10 years ago of microtransaction starting to explode, became very addictive, and it started looking at this, and you can see from the AA netbook ratings, as an example, over the course of the previous years and previous quarters, that green section which has been growing larger and larger is what they call live services. So this is not purchasing a game and this is not even like mobile purchases, this is live services. So a great example is FIFA, where you would go in, play a compact, and depending on what you've got, that variable reward, then we continue spending money on it. And often this was very focused that those players would spend a large amount. So those whales, as they would often be called. So they started to draw a lot of negative concern around this, especially if we're building an addictive loop and spending money for it, then it sounds very similar to gambling, which a lot of people and some countries have argued as well, so how could this end up being used for a good purpose. Well, a great example of this is probably recently is most likely Pokemon GO. It used the same routine, trigger, variable reward and addiction elements and investment. Obviously one of the best examples of investment is getting all of the Pokemon. Yet instead it was encouraging you to go out and exercise. So there is many ways to actually use this sort of loop and actually use the dopamine effects to trigger a good healthy outcome. And even for a scenario like sales as mentioned, make it much more personable. So rather than trying to focus on large brand discounts that get everyone in the same, try and find things that are actually individuals to those users and actually try and get that investment and trigger that makes it more variable to them rather than just feeling like, "Oh, it's another discount from another store." And lastly, I also wanna touch a little bit on the legal and medical updates that have come around this, because there's been a lot of concerns. Obviously a large element of this addictive loop is brought into video games, products and all this sort of thing. And so the World Health Organisation recently back in 2018 actually announced something called gaming disorder, which effectively was built around this premise that they would get addicted into this loop, and it would eventually degrade all the aspects of your life. But then interestingly in 2020, during the COVID scenario, we've obviously had a bit more of an outcome of there are people returning to games and keeping themselves mentally active. And surprisingly, the World Health Organisation again released another statement, now encouraging people to play games during this time. So there is a bit of pro and con and we're still figuring that out in the industry. So use your powers for good when it comes to this addictive loop. So, overall, I wanted to take you through what that habitual dependence loop was, the trigger routines, rewards and investments, where it can be used, the use cases of a lot of the companies that currently using it, and try and make you aware of how you're stuck there currently, and how you can bring it into your products, along with some of the long term effects to try and use that responsibly. And thank you. (upbeat music)

With Great Addiction, Comes Great Responsibility.

Raymond Dellar- Iteration Manager, Delivery Lead, and Agile Coach - DiUS

Goals for this session…

To educate on the habitual loop
Display where it has been used and how effectively
The Good vs Evil in addiction
Long term Effects and Legal Factors
Answer any questions you may have

Background image of two snow-capped mountains with plot points ascending and a flag at the summit of the taller mountain.

Habitual Dependence and Addiction

Pirate Metrics

Graphic of a flow chart with five text bars labeled: Acquisition, Retention/Churn, Revenue, Activation/Habitual Dependance, Referral/Virality. The Retention/Churn and Acquisition/Habitual Dependence bars are stacked on top of one another, with an arrow pointed toward them from the Acquisition bar and an arrow pointing away from them toward the Revenue bar. Additional arrows points from these two bars toward Revenue. A tertiary arrow points from Activation to Acquisition. The Referral bar is located outside the core flow but is in the same field as Acquisition.

Why do products need it?

Graphic of a funnel demonstrating general stats of user attrition as they move through a product. Funnel has four tiers with corresponding labels to the right and percentages to the left. Tier at the apex is labelled Total Sessions and corresponds to 100%. Third tier is labelled Sessions with product page view and corresponds to 43.8%. Second tier is labelled Sessions with Add-to-cart and corresponds with 14.5%. Bottom tier is labelled Sessions with transaction and corresponds to 3.3%.

Where is it used?

Composite graphic of three images. On the left is an advertisement for a MacDonald's app promotion that shows a smartphone in the centre of a Monopoly board. On the right are images of pharmaceutical style capsules bearing the facebook logo and a selection of Major League Baseball trading cards.

What is Habitual Dependence?

Black and white image of a 1950s era photograph with two young boys wearing goggles and pointing futuristic looking devices at one another. Beside this image, a text box titled: Operant Conditioning alongside a graphic of a mouse in an electrified cage with icons captioned: response lever, food dispenser, loudspeaker, lights. The text box has the words: early 1900s written under it in parenthesis.

Variable Reward

Two columns. The first is headed Fixed Ratio: Rat presses lever and gets cheese as a reward every second time. Below this, a number of rat icons with arrows pointing alternately to the words cheese or no cheese. Second column is headed: Variable Ratio: Rat presses lever and gets cheese at random intervals of 1:2. Below this, a number of rat icons with arrows pointing at random to the words cheese or no cheese.

Trigger

Two columns labeled Internal and External. In the internal column, images of Winnie the Pooh with a rumbling tummy and a stick figure icon asleep on a desk with the caption:Boredom! In the External column, images of an email inbox icon, an advertisement for bottled water with the bottle overlaid on a desert landscape, and an image of a group of young people sitting in a circle.

Routine

Images of: A smartphone open on the instagram app, a spotify playlist, a candycrush video game view, Netflix search screen, and twitter screenshot.

Routine Motivations

Graph with Y axis labeled Motivation and X axis labeled Ability/Ease. A curved line is plotted on the graph beginning high on the motivation scale and sliding in a downward curve to flatline along the ease scale. A bubble labeled Triggers fail is located below the curve, near the zero vertex of the two axes and a much larger bubble labeled Triggers work is located above the curve, high up on motivation and farther along on ability.

Reward.

Three columns. The Tribe, the self, the hunt. In the Tribe column, a photograph of traditional native american teepees and and photograph of a man and a woman socializing. In the Self column, an historical photograph of a Native American elder and a photograph of a man playing a musical instrument. In the hunt column, an illustration of hunter gatherer society traditional hunting rituals and an image of a modern casino interior with rows of slot machines.

Why does it work?

Chart of two graphs titled: Dopamine Levels. Both graphs are marked with four progressive action points labeled Click, First Section, Second Section, Chocolate, [corresponding to the concepts of trigger, routine or routines, and reward.] The first graph shows a relatively uniform pattern between dopamine levels across the four actions with a only slight spike when each element is introduced and a slight dip over time. An arrow points from the first graph to the second one, indicative of a change in routine. Here, the graph shows a clear spike in dopamine correlated with the trigger when moving from a guaranteed to variable reward. Dopamin drops through first section and second section, and spikes dramatically when chocolate reward is introduced.

Investment

A series of images of: Collectable star wars toys, a pyramid of facebook like icons, screenshot of instagram follower tallies, spotify master playlist, and linkedin number of connections.

Investment Returns

Screenshot of a personalized discount offer promo code Raymond received from a retailer with steps on how to redeem.

The loop

Graph with four quadrants labeled Trigger, Action, Reward, Investment. A coloured circle is overlaid at the centre, with different coloured bars pointing around the circle and corresponding to each quadrant. The trigger quadrant has an icon of a finger pointing to a brain, eliciting a signal icon and bulleted text reading: Internal and External. The Action quadrant has an icon of an arrow pointing to a pair of concentric circles and bulleted text reading: Motivation and Ability. The Reward quadrant has an icon of a brain and bulleted text reading: The tribe, the self, the hunt. The investment quadrant has a dollar sign icon surrounded by a circular loop of arrows and bulleted text reading: Commitment and Next trigger.

Real World Effects

Bad Use Case

Side by side examples. On the left, a bar chart titled: Electronic Arts Digital New Bookings by Composition. The graph charts user engagement revenues scored according to conversions from Full Game Downloads which are represented by the blue portion of the bar, Live services which are represented by the green portion of the bar, and Mobile services which are represented by the yellow portion of the bar. Vertical bars of combined and individually tallied stats visually delineated by colour reflect platform specific as well as overall engagement across the third quarters of 2018, 2019, and 2020 respectively, as compared with the trailing 12 months for each. Data shows growth trend across time in the Live Services conversion. A pyramid graph beside the data demonstrates general stats on gamers, with two thirds of the pyramid fill made up of non-payers, a third moderate payers, and a tiny fragment at the apex representing heavy payers. The non-payers are symbolized by a hook icon, the moderate payers are symbolized by a fish icon, and the heavy payers are symbolized by a whale icon.

Use your powers for good

Images of three sample screens from Pokemon Go. Beside this, an image of a row of stick figures in black, with one highlighted in orange captioned: Make it personal.

Legal and Medical Updates.

Side by side comparison of: 2018 vs 2020 World Health Organization statements on 'Gaming Disorder', first flagging it as a behavioural pattern identified by increasingly compulsive gaming to the 2020 classification as an addictive behaviour.