Five Nobel Prizes in economics have been given for research done in Behavioural Economics.
Behavioural Economics is the study of decision-making.
How to use concepts of Behavioural Economics in UX design?
Using methods from psychology, sociology, neurology, and economics, behavioural economics sheds light on the most fundamental activity of life: the decision-making process.
Amazon, FB, YT, Google, and Twitter, all use Behavioural Economics to design their products.
Should Product Managers Know Behavioural Economics?
Nir Eyal has described in his book: Hooked How to Build Habit-forming Products the application of Behavioural Economics in UX design.
He has prescribed the Hooked Model with four phases of hooking users.
Once, the user goes through this hook loop frequently, habits are formed and then the user will use the application without conscious thinking.
The hooked model has four phases:
- Trigger: Identify the internal trigger for which users will use your product. E.g: The internal trigger to use social media applications is getting bored and interested in other’s life.
- External Triggers to using Social media apps are the notifications when someone likes the content that you have posted. External Triggers are designed intentionally to bring back users to your application.
- Action: These are actions of liking the content, commenting on the content, and viewing the content on social media apps or Youtube. Actions are taken in anticipation of rewards.
- Variable Reward: Reward for enjoying the content based on your own preference. Rewards can be Monetary, emotional, psychological, or social rewards. E.g.: Rewards for using Social media apps are likes, comments, and all other positive emojis that are designed in these apps. These are social rewards and appreciation for which you post your content on these apps. There are rewards like an increase in followers and then one can also monetize it later.
- Investment: The time that the user spends or money that is spent on this app. With more time spent on these apps and with repeated cycles of the hook, one is habituated to these apps. The more followers in an app, the more it is difficult to switch from Twitter. There are skill investments also, Users love Excel because they are pros in it. they will not want to switch to other tools.
These Hook cycles are designed using the concept of Behavioural economics in UX design. UX Design is aligned based on the psychology of users, user behaviour and these concepts of behavioural economics.
Behavioural economics is the study of the decision-making of humans.
Our Product Management Course is designed to cover the Application of Behavioural Economics in UX Design and we cover the following topics:
- Nudge
- Choice Architecture
- Behavioural Economics
- Behaviour Driven Design
- Hooked model – How to build habit-forming products?
If you want to learn the Application of Behavioural Economics in UX Design, contact us @ rahul.vtc@gmail.com
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