With Great Addiction, Comes Great Responsibility

When 0.4% of all users of Candy Crush generate more than 50% of the game’s revenues, when attention translates directly into revenue, where a small number of super-users of platforms generate most of the content on those platforms, the line between “habit” and “addiction” has become well and truly blurred. Games, apps and online services are explicitly designed to trigger the same kinds responses as addictive substances and behaviours.

In this presentation Raymond Dellar will dissect how these addiction loops are built into products and the psychology behind why it works. He’ll conclude by considering how we can use these lessons to help and improve our customer’s lives, instead of draining them.

With Great Addiction, Comes Great Responsibility.

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

Keywords: habitual dependence, pirate metrics, feedback loop, external vs internal triggers, reward.

TL;DR: Raymond explains the psychological concept of habitual dependence and how it is used throughout product experiences across all industries to hook and lock users into a repetitive cycle of: trigger, routine, reward, and investment that keeps them addicted to products or experiences. During the reward phase, they are encouraged to re-invest, which in turn both builds brand loyalty and offers fresh triggers, further perpetuating the cycle. Raymond walks through some examples of positive and not so positive applications of this method and addresses some of the associated legal and ethical implications.

Thanks for coming to WD summit, let’s dive in!

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
Habitual Dependence and Addiction

Pirate Metrics: This is a flow through of how customers move through products. Acquisition is about getting customers into the product, retention is about holding them there, activation is about getting them involved, revenue is about the purchase, and referral/virality is about spreading the message around. Why is this called ‘pirate metrics’? Because the first letter of each category spells out: Aarrr!

Why do we need this? Related to tracking dropoff rates as customers move through the funnel. By the time they get to the transaction stage of the flow, only 3% have been converted, so we need a way to draw those customers back in. How can we do that?

This idea of the habitual loop is used today across an enormous range of products to bring you back to those products and keep you addicted. (ex: McDonalds, facebook, MLB and other trading cards..)

What is Habitual Dependence? Has it origins in the early 1900s when psychological ethics were a bit looser than they currently are. Was brought about by Skinner. You may have heard of the Skinner’s Box, which is based on Operant Conditioning, which is a scary concept which explains how to get somebody into a loop and get their dopamine levels spiking at your will. Skinner put mice in a cage with a light and a food lever. When the light came on cheese came out of the food lever. When the mouse got the food reward at a fixed rate (i.e every second time it pressed the lever) it stopped pushing the lever when full. But when it got the food reward at random 1:12 intervals, or variable rate, it kept returning to the point of getting ill from overeating.

This is based on the idea of triggers, which fall into two categories: Internal triggers (ex: boredom, hunger), or External triggers (ex: ad billboards, notifications, referrals and recommendations from friends). So the trigger brings you into the process, which then leads to a routine. This is often the boring part. You are going through the motions looking for something that captures your attention or emotion (ex: social media scrolling, television and movie choice apps, video games, etc.)

Routines combine ability with motivation. The motivation element operates on a gradient. The higher the motivation to engage in the routine and the easier it is to do so are influenced by how well triggers are working. Low motivation and ability= trigger fail. High motivation and ease = triggers work. We’ll also still engage one some level when motivation is low if ease is high (ex: clicking on an email you’re not that interested in just because it’s only one tap).

Reward. Reward breaks down to three general categories that are rooted in our brain centres dating back to premodern society: The tribe, the self, and the hunt.The Tribe is about community rewards (ex: family, workplace, peer groups). The Self reward is more about individual rewards (ex: musical proficiency, self inner or outer improvement). The Hunt reward today centres around money or material gains. (ex: gambling).

Why does it work? Dopamine. When first testing rewards, data showed that as you click through scenarios predictably with a guaranteed reward, dopamine stays relatively stable. But once variability is introduced, it spikes dramatically upon reaching the reward.

Investment This part of the loop is arguably the most important, and is where you see the numbers start to dropoff. User investment is strong, it’s the reason you come back to a particular product. Ex: McDonalds. Triggers may be ads, or kids being hungry. The routine is going and for the kids, it’s eating a meal. The variable reward is the collectors toy you get with a happy meal. The investment is that this toy is one of a collection, so kids now need to return to collect the set, but it’s variable, you don’t know which toy each visit will offer. The toy itself therefore becomes another trigger – as the child plays with it, they think: I want to go back and get the other ones in the set. You invest because you feel history and connection with the brand and that in turn leads to more investment over time (ex: facebook, Apple, linkedin).

Investment Returns. Ex: Dick Smith, who were dying as a retail brand prior to the pandemic but rebounded due to online sales, improved online capabilities, and playing on user investment. They sent Raymond a personalized promo code for 40% off a product he had previously viewed on their site, enticing him to re-invest.

The Loop. So the full loop process is completed: Internal or external triggers lead you to a corresponding action mediated by motivation and ability. The action leads you to a reward from the tribe, yourself, or the hunt. And these rewards strengthen your investment in the product, leaving you primed for a new trigger to start the process over. It is a repetitive and addictive process across virtually all products.

Real World Effects. Loot boxes. These are used in gaming. The routine is playing the video game, and the reward is the loot box. (ex: new character skin or a new gun). Around five years ago, this changed from being a fixed reward in the game path from a downloaded game to offering a variable reward in the live gaming space. The variable reward in the live space is designed to produce compulsive and addictive behaviour. These rewards were often aimed at gamers who spent large amounts of money. This generates concern because of the correlations to gambling.

Use your powers for good. Ex: Pokemon Go, which uses the same routine/trigger/variable reward/addiction/investment elements for a positive outcome to make users go outside and exercise, using the dopamine effect for a good, healthy outcome. Same with personalized sales strategies such as the discount code tailored to Raymond. By making it personal you generate investment.

Legal and Medical Updates. A lot of this addictive loop is brought into video games and products, to the point that in 2018, the WHO released a statement identifying ‘gaming disorder’ as a potentially addictive behaviour. In 2020 in response to Covid, they released another statement, but this time encouraging gaming as a potential salve to ward of isolation. So there are pros and cons from this perspective and the industry is still figuring this out. Raymond hopes we use our powers for good when it comes to this loop.

Recap

  • What is Habitual Dependence?
    • Trigger
    • Routine
    • Reward
    • Investment
  • Where it’s used?
  • Use Cases
  • How you can use
  • Long Term Effects