Hooked on Finance - Creating habit-forming FinTech apps

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Hooked on Finance: The science & psychology* behind habit forming Fintech apps Nathan Fulwood @kidcamel *not a doctor.

Transcript of Hooked on Finance - Creating habit-forming FinTech apps

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Hooked on Finance:The science & psychology* behind habit forming Fintech apps

Nathan Fulwood@kidcamel

*not a doctor.

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We help ambitiousbusinesses design remarkable

brand journeys.

We help ambitiousbusinesses design remarkable

brand journeys.

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1.49bn 316m 900m 400m

(Remarkable brands being built via exceptional experience and the network effect)

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Hooked, by Nir Eyal

“Hooked gives you the blueprint for the next generation of products. Read it or the company that replaces you will.”

Matt Mullenweg, founder of Wordpress

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Every time you check your phone during this presentation, somewhere a kitten dies.

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90% 42%

35% 43%

not saving enough never checked pension performance

regret not saving more wish they’d had more one night stands

http://www.moneywise.co.uk/news/2014-04-30/90-brits-not-saving-enough-retirementhttp://www.dailymail.co.uk/news/article-3236186/Our-number-one-regret-Not-saving-Putting-money-away-tops-list-50-things-Britons-differently-live-lives-again.html

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✓Closer management, better finances✓Increased customer lifetime value (CLTV)✓Pricing flexibility✓Driving growth✓Creating competitive standout✓Front of mind = front of pack

Forming a healthy habit

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The Hook model:

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PAID TRIGGERS:Expensive and unsustainable for habit forming

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Earned Triggers:

(unreliable and short lived)

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Relationship Triggers:

(Word of mouth, recommendation, the network effect)

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Owned Triggers:

(Post-engagement, opted in, driving re-engagement)

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Triggers:

Paid Earned Relationship Internal

Acquisition Re-engagement

Progression of value

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Internal Triggers

Help user’s scratch that itch.Associate your triggers with user’s state of mind.Eventually they won’t need an external trigger

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(Taiichi Ohno, Legend)

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THE FIVE WHYS? Why?Why?Why?Why?Why?

(keep asking Why? until you get to the base emotional need you have to satisfy)

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TRIGGERS • Set up an Action• External or internal• Negative emotions frequently serve as internal

triggers• Understand your customer’s needs and align

your triggers with scratching that itch

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The Hook model:

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B=MATBehaviour = Motivation +

Ability + Trigger

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Seek Pleasure Avoid Pain

CORE MOTIVATIONS:

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Seek Hope Avoid Fear

CORE MOTIVATIONS:

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Seek Social Acceptance Avoid Rejection

CORE MOTIVATIONS:

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Understand the reason people use a product or service.Lay out the steps needed to get the job done.Start removing them until you reach the simplest possible process.

Easier = better.

Something Really New: Three Simple Steps to Creating Truly Innovative Products by Denis J. Hauptly (7 Nov 2007)

ABILITY

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Time Money Physical Effort

Social Deviance

Non-routine

Brain Cycles

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TIME:

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TIME:

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MONEY:

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PHYSICAL EFFORT:

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BRAIN CYCLES:

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NON ROUTINE:

"I'd never struggled with understanding the importance of saving, but hated the exercise of doing it regularly and having to anticipate changes in my spending + income. Thankfully, now the trustworthy robots powering Digit do all that for me."

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Time Money Physical Effort

Social Deviance

Non-routine

Brain Cycles

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(Frederick II of Prussia and the introduction of potatoes. Google it. Genius move.)

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HEURISTICS: Mental shortcuts we take to make decisions and form opinions.

AKA Persuasion architecture.

Learn them. Use them.

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FRAMING EFFECT:

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ENDOWED PROGRESS EFFECT:

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ACTIONS • Simplest behaviour in anticipation of a reward• B=MAT• Pleasure vs Pain, Hope vs. Fear, Acceptance vs.

Rejection• Time, money, physical effort, brain cycles,

social deviance, non-routine• Heuristics are useful mental shortcuts to exploit

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The Hook model:

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REWARDS

Tribe Hunt Self(Attraction, inclusion,

community)

(Accumulation of resources, money and

knowledge)

(Intrinsic worth, completion, mastery)

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Tribe:

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Tribe:

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Hunt:

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Self:

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VARIABLE REWARDS • 3 types of rewards:• Tribe - connectedness with others• Hunt - material resources & information• Self - master, competence and completion• Finite variability becomes predictable and less

appealing• Satisfy needs, but leave users wanting to

reengage

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The Hook model:

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The IKEA Effect:The more users invest time and effort into a product or service, the more they value it.

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STORING VALUE: • Content• Data• Followers• Reputation• Skill

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Content:

Simple.com

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Reputation:

Fidor.com

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Data:

Level

Sets up the next trigger

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The Hook model:

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(Don’t be a dick)

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The Manipulation Index:

Improves the user’s life

Does not improve the user’s life

The maker would use it The maker wouldn’t use it

Peddler Facilitator

Dealer Entertainer

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KEY TAKEOUTS • The brand is the experience• Understand your audience• Easier = better• Use the tips, but test and learn• Play nice

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THANK YOU!