The Role of User's Habits in Startup's Success - And How They Can Backfire ?

TLDR - Discover the Benefits of Habit Formation in Startups, the Reinforcement Tactics Companies Use, and the Risks When Habits Turn into Unhealthy Addictions

Humans are creatures of habit

People love to execute their daily tasks as a function of habit. Habit is a means to reduce cognitive load/”brain cycles” we consume while simply living. Habits are hard to form though. A person on an average takes 66 days to form a habit. Research suggests that morning habits are easier to form than evening/night habits. Also, it’s interesting to note that habit development is not linear; a asymptotic growth curve demonstrates that initial repetitions have the greatest impact on habit development.

Why do companies promote habit formation ?

Habits reduce the friction the user experiences while using a product. When users form habits around a product, companies see an increase in customer lifetime value, more flexibility in increasing prices, and form the basis of companies moat due to inertia of users against change of status-quo. Customers who regularly use the product are also more likely to help in spreading the good word.

Companies which we have trusted in the past keep getting chances by the user. I am often tempted to check google search and see if they are back in reckoning w.r.t Open AI and Perplexity.ai.? This stems from the fact that old habits die hard, habits are etched in our brains and we all are trying to go back to our old ways all the time.?

Example: Apple keyboard is made to lock in the customer into premium experience space. The keyboard keys are different, once a user starts using Apple keyboard, will the user then switch to Keyboard in windows or Unix machines. Fat chance the answer is no. Vice versa is also true though. In my own experience, I struggled to give a coding interview in a reputed company because I was given an Apple instead of Windows/Unix for a coding exercise.

Do habits still need reinforcement??

Duolingo urges you to form a habit by permitting notifications from the app. When the user permits usage and notification frequency is measured, he feels respected. Notifications barrage - are a nuisance to users and too many notifications at best desensitize us towards notifications from that app. Zomato sends interesting notifications, trying to remind you to build a habit by engaging people with humor. Question is does humor overcome the nuisance tag that notifications have come to represent it.? It is best to personalize the frequency of notifications.?Every user will have a sweet spot of frequency of notifications they are willing to consume, before to them it starts looking like suffering. Deep dive into data will give ranges before the customer decides to drop off the notifications.?

Twitter users had a certain number of followers, before they started using twitter daily and formed a habit. Followers count correspond to likes and comments and that means that users will have established feedback loops for their content. Twitter’s current engagement has fallen since it does not permit users to reach others users organically; with the main objective to increase Twitter’s revenue. But when people do not get engagement they drop off. Habits need to be actively reinforced.

When can addictive habits start hurting the company's bottom-line?

When companies start exploiting dark patterns and start maximizing things like time on app, they might be setting themselves up for failure. Take a look at Facebook. Almost everyone of the millennial generation, posted actively on the app. But now the app looks like a ghost town. In my perception, the app seems to have used dark patterns to increase time on the app so as to increase the number of advertisements shown and consequently the revenue earned. In doing so they left the user resenting time spent on the app as wasted time. The same holds true for Instagram or YouTube shorts. Both leave the user (at least me) with the feeling that the time spent on the app was wasted. Instead, these apps should find a metric which enables the user to feel that his/her time was well spent and it aided his/her emotional well being or mental well being or any other positive emotion for that matter. Social networks that try to inculcate negative habits in the short run, are running the risk of obliteration in the long term.

Originally Published at Substack

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References

1. Habit Formation and Behavior Change | Oxford Research Encyclopedia of Psychology
2. What Does It Really Take to Build a New Habit? (hbr.org)
3. Nir Eyal - Hooked
4. Experience from the field

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Author, Priyanka, is reachable at [email protected] or on LinkedIn at