Customer Knowledge is a key factor for the success of any Growth, Product or Marketing initiative. This has now become almost an established fact within the industry. The Growth Competency Model from Adam Fishman at Reforge, for example, provides a great framework to assess its relevance within the context of growth. However, I believe, most companies, don’t exploit the full power of customer knowledge. They tend to ignore the positive impact, that the ability to understand user psychology along with what drives and shapes customer behaviour, can have in all their endeavours. Probably because the general belief is that people act in a rational way and do what they say they do; that customers’ preferences outweigh all the irrational motivations, and no emotion comes into play when they make a decision. Therefore, appealing to the logical brain and deploying a pure rational model is the way to go.
What Behavioural Science says
The reality is actually different. Insights from the field of Behavioural Economic and User Psychology have shown us that most of the people behave in a way that’s not rational. Multiple cognitive bias, emotions and more come on the way. The positive thing is that, very often, they do it in predictable ways and therefore it’s still possible to influence the decision- making process. The general expression for this is that most of us are predictably irrational. The implications of these finding are huge! Especially for those who are in the business of influencing behaviours and rely on the choices customers and prospects make towards their products, solutions or services. This is valid for both B2B and B2C.
How to proceed
A question might come now: Where do I start? How can I start applying these insights? A recent episode - Using Behavioral Science to improve your product - from Lenny Rachitsky’s podcast might come handy. Kristen Berman (from Irrational Labs ), provides plenty of useful insights on the topic along with real- life examples. I really enjoyed it and Kristine share some great tools that can facilitate in getting started with the implementation of the Behavioural design process.
Behavioural Design uses insights from behavioural science to purposefully inform design decisions. In the episode, we see that this process has three primary phases: 1. The behavioural diagnosis (Identify your desired behaviour and outline every step your users have to take to achieve it) 2. Identification of psychological bias (Determine the barriers that get in the way of decisions and the benefits that motivate them) 3. Experiment (Choose one barrier to address and design an experiment to test an intervention)
The tools presented which will assist in the process and which I found very valuable are:
1. The 3B Framework Which provides a model for behaviour change that can help designers, marketers, and managers to build better products or services. It consists of three components: · Behaviour - This it is the most important part of behavior change as we can’t solve any problem without identifying the behavior that needs to be changed. This means singling out the action that you want someone to do in order to achieve your business outcome. · Barriers - This is crucial too as we need to reduce or removing entirely the barriers to completing a behavior. Humans often take the path of least resistance—the easiest action is the one we’re likeliest to take. The barriers can be Logistical and Cognitive (As for the latter, the team at Irrational Labs have identified Attention, Cognitive Overload, Status Quo, Mental Models as the most common within product experience) · Benefits - Here we want to amplify the benefits to increase the motivation to completing the behaviour. There are two benefits: the actual one and the more immediate one. Benefits don’t always have to be literal, like money or goods. Psychological principles (like following norms, reputation, and altruism) can serve as motivating benefits and are often the most relevant.
2. Behavioural diagnosis
This is the toolkit in behavioural science which helps understand what people actually do versus what they say they will do. It's like a journey map where you're really trying to map the steps that get people to the behavior change. And then, you overlay the psychologies that are driving people at each step. As behavior change isn't easy, it’s crucial to understand the steps that get someone there before you're trying to change it.
3. The 16 Critical Cognitive Biases
There are more than 200 cognitive biases but the team at Irrational Labs has selected a “Sweet Sixteen” list as a high-value collection worth understanding and that can help in identifying the most common Barriers and Benefits. I highly recommend listening to the full episode. You will benefit from it at different levels depending on where you’re in the journey.
I’d like to conclude with three final thoughts following from the above:
1. A crucial step to behaviour change is tracking the behavior you seek to change! Therefore, in addition to tracking conversion, active use, and retention it’s important to track accurately also what action is needed to drive the desired business outcomes. Ultimately, the action derives from the core problem you’re trying to solve.
2. The successful implementation of the Behavioural Design process requires effective cross-functional collaborations among different teams like product, design, UX research, analytics, the broader marketing team, and sales. It's important that all stakeholders are aligned since day 1 on the behaviour to change. Having an internal figure that can orchestrate them all will be extremely beneficial. The relationship between product and marketing is particularly crucial. As, it’s not just about the way you build the product. Creative and narrative comes into play too. How you position it and how you communicate about it and the way you frame the different options along the journey is also essential and will influence how successful you are at acquiring, retaining, and monetizing your customers.
3. In light of all the above, Product Manager, Marketers and Product Marketing can be seen as choice architects. As such is very important to become knowledgeable about the human psyche.
It's safe to say that companies that are open to experiment in the field of behavioural science to deepen their customer knowledge and act upon it will have better chances at embarking on a successful journey of growth and innovation.
I highly recommend a few books in the area like Thinking, Fast and Slow and Influence. Your view of the world will change completely after reading them. Mine did.
Feel free to leave a comment or message me if you have any feedback on the topic. Always curious to learn from other people’s experiences.
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