The Fogg Behavior Model

[Note: I shared this mental model with my email subscribers on Nov 6, 2016. If you want to receive a new mental model every week, join the club.]

What it is:

The Fogg Behavior Model (FBM) is a way to understand what drives behavior.

We normally assume that every decision / action is based on a solid rationale. That’s usually true, but that’s not enough. To overcome the inertia of inaction, you need something more. Enter the FBM.

At the heart of FBM is an equation:

Behavior = Motivation * Ability * Trigger

Thus, driving a behavior is not about just providing Motivation. You also need Ability (e.g., ease in terms of time, money, effort, routine vs. non-routine). And you need to Trigger the behavior – with a cue, prompt, or call-to-action.

Fogg Behavior Model

[Source: BJ Fogg’s Behavior Model website]

Examples in business:

  • Marketing: Your customer value proposition (motivation) is not enough to drive a sale. You also need to make it super-simple to say Yes, as I found when trying to sell toilets in rural Bihar (see point 3 in article).
  • Design: Having the most important features in your app isn’t enough. You need to make them easy to access (Hick’s Law – anything more than 2 clicks away won’t get done), with a clear call-to-action (Fitt’s Law – the big red button always wins).
  • Productivity: The reverse also works. If you want to stop checking FB on your phone at work, make it difficult to access – log out so you’ll need to enter the password next time. And remove visual cues – take it off your home screen.

 

Rules to follow:

  1. When you’re persuading a buyer, don’t just focus on why they should buy. Make it easy for them to say yes (e.g., easy, low-risk payment terms), and then trigger the sale (e.g., social proof, limited time offers).
  2. If you want to break a habit, just make it hard to do. And remove all cues from the environment.

Further reading:

 

Filed Under: Psychology and Human Behavior

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How ratings result in worse, not better, customer service

A few weeks ago, my wife and I were in Galle, Sri Lanka for a much-awaited vacation. We chose a villa with great reviews on TripAdvisor. It seemed a decent place. A little far from the main town, but the hosts were quite friendly.

But we couldn’t get much sleep any of the nights we stayed there, because our room had bedbugs.

After we came back from the trip, we made sure to rate the place. We left not one, but two ratings (one each from my wife and me). Both of them were 5 stars.

Wait, what?

Did we enjoy getting bitten by bedbugs?

I was surprised too. Not just at my own rating, but at other ratings on TripAdvisor too. This place was one of the most recommended ones in Galle!

So how did this happen? How did I – and all the other guests – rate inferior customer service so highly?

 

Do ratings work?

The prevailing wisdom is that ratings work. That’s why they are everywhere. When you open an app on your Android phone, it asks you to rate it on the Play Store. Complete a ride on Uber, and you have to rate your driver. Order something from Amazon, same story. Open your inbox after a long vacation, and what’s the first email you see? A message from either your airline or hotel, requesting you to rate your experience.

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I’ve always found the act of rating quite empowering. The equation is simple – if you can rate a service provider in public, he has every incentive to ensure that you get great service. Right?

Well, after that incident in Galle, I realized that ratings may not result in better customer service. In some situations, they may be worsening it.

Wait, how does that make sense?

 

I’ll explain. But first, let’s agree on two key facts about ratings.

1. Ratings have an impact on service providers. That’s one reason they’re ubiquitous. Drivers on Uber do get blacklisted for low ratings. Top-rated hotels on TripAdvisor do get ten times as many bookings as lower-rated ones.

2. Customers know ratings have an impact. This makes them capricious (this Verge article calls them – us – entitled jerks). To see this, you only need to see a few app reviews. Sample these ratings on Circa (an app that used to provide summaries of important news):

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Ratings are supposed to highlight how good an app is. But no, sometimes you get a 1-star for an innocuous review request.

This customer fickleness is not just an app store phenomenon. As the Verge article says,

We rate for the routes drivers take, for price fluctuations beyond their control, for slow traffic, for refusing to speed, for talking too much or too little, for failing to perform large tasks unrealistically quickly, for the food being cold when they delivered it, for telling us that, No, we can’t bring beer in the car and put our friend in the trunk — really, for any reason at all, including subconscious biases about race or gender.

Please the customer, and hope for the best

The fact that we wield a strange amount of power and know it, turns upstanding, proud cab drivers and B&B hosts into fawning, obsequious and servile slaves. You can’t jilt or offend a customer in any way. A single misstep, and you get a 1-star rating. Not a 4- or 3-star. Your last five customers may have given you 5 stars, but this single rating could put you out of business. In New York, Uber delists drivers from the platform if they go below a 4.5 star average!

So what is a service provider to do? Provide honest-to-God great service. And hope that nothing gets screwed up.

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But there’s an easier way.

The honest approach is hard, time-intensive and expensive. And it’s subject to random whims of the entitled customer. If a customer expects Hilton service at McDonald’s rates, you’re bound to get 1 star. No matter what you do.

But there is an easier, quicker and more inexpensive way. One of the oldest psychological tricks in the book.

Dr. Cialdini, the author of Influence, calls this trick “Liking – The Friendly Thief”. Studies show that if you spend more time with a person, you end up liking her. And if you like a person, you tend to favor her in your dealings.

At a certain level, this is obvious. But that doesn’t make it any less powerful. Malcolm Gladwell cites a great example of this in Blink. Patients don’t file lawsuits when they suffer shoddy medical care, if the doctor is polite. They only file when they feel the doctor mistreated or ignored them.

“People just don’t sue doctors they like.”

So, to get a great rating, all you need to do is: (a) smile a lot and appear likeable; and (b) talk a lot, to create a human connection and familiarity.

Tried and tested. Once you get to know the service provider, you’d be a stone-hearted reviewer to leave anything less than 5 stars.

 

Nice host + bad customer service = 5 star rating

That’s what happened to us in Galle. Even though I was aware of this cognitive bias, I was powerless to counteract it.

The owner received us with great cheer. He chatted with us for hours. Always smiling and laughing (even when I didn’t crack a joke. And I’m not that funny anyway). I learned a lot about his life. I commiserated on his past troubles, and lauded him on his recent turn in fortunes.

My room still had bedbugs.

But my wife and I didn’t complain. Who can tell off such a nice guy? And when he requested us to leave two ratings on TripAdvisor, how could we refuse?

 

Talk more. Do less. Get 5 stars. Repeat.

This is just one small episode. But it sets in motion an insidious feedback loop, which could result in worsening customer service over time.

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  1. Customer give a 5-star rating despite bad customer service.
  2. Service provider sees this as validation of his strategy. And becomes more chatty, more fawning.
  3. Soon, if he’s smart (our guy was), he realizes there’s no return on actual customer service. It’s much easier to smile and bluster, than it is to clean the room. Over time, he’ll become more talkative, and true customer service will degrade.

Woe betide the unsuspecting traveler when that happens.

Thus, ratings may have an impact that’s the polar opposite of your intention.

 

How do we break this loop?

Now, I’m sure you want great customer service. So, how can we break this loop?

Just being aware of what’s happening is not enough. You’ll only feel worse, as you continue to give 5-star ratings like a powerless lab rat.

The only way to break this cycle is to have a system of multiple ratings on different attributes, instead of one single unidimensional one.

Why would that work? For three reasons:

  1. It would force objectivity. If you’re rating your stay at a B&B separately on Cleanliness, Quality of Food and Friendliness of Staff, you’re more likely to question the halo around your host’s head, and distill your cheery feeling into its components
  2. It would give the service provider the right feedback on how to improve.

 

Ratings are here to stay. Let’s make sure they actually improve customer service. Rather than slowly turning us into smiling zombies.

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5 things I learnt from talking toilets in rural Bihar

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Over the past year, sanitation has hogged headlines in India like nobody’s business. And rightly so – it’s everybody’s business. Two out of three households in rural India don’t have a toilet. And many of those who do don’t use them. Against this intimidating backdrop, over two years ago, my colleagues and I at Monitor / Monitor Inclusive Markets set out to develop a market-based solution to the sanitation problem in rural Bihar. And over these two years of selling the idea of a toilet to rural consumers and working closely with people selling toilets there, I’ve learned a lot regarding consumers and how to sell to them.

 

With the Swachh Bharat Abhiyan (the new avatar of the Nirmal Bharat Abhiyan, itself a new avatar of the Total Sanitation Campaign), the government wants to make India open defecation free by 2019. In less than five years, all 1.2 billion of India’s population will use a toilet. Today, we’re at least 600 million shy of that. In fact, as people in the sanitation sector often say:

According to the 2011 Census of India, Bihar is a laggard in toilet coverage – only 18% of rural households have toilets. In 2012, we set out to develop a market-based business model to resolve this – could we harness market forces to drive adoption of toilets? After talking to 1000+ villagers in Bihar, meeting 150 value chain players and visiting sanitation interventions in many other areas, we developed business models that are now being implemented in parts of Bihar (see post-script for more details on the models). It has been fascinating to put together a business model and see it take shape on the ground. Along the way, I have also learned a lot about how consumers think, and how to sell to them.

1. Your value proposition needs to be concrete, tangible and real to your consumers

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Your product’s value proposition has to make sense to the user, which means three things:

  1. Concrete: Your product’s benefits can’t be nebulous – they need to be specific. For example, just telling consumers that using a toilet is good for health is not convincing – you need to explain step-by-step how open defecation means you’re eating your own shit.
  2. Tangible: Sanitation NGOs today are doing a good job of making the health benefit concrete. But it’s not tangible. Even after you explain the benefits, people still need to be able to see it – just logic won’t do. And health benefits are particularly hard to demonstrate because (a) they start accruing only after a majority of the village stops open defecation, and (b) even after safe disposal of faeces, people still fall ill due to unsafe drinking water and other factors. And if something so axiomatic is hard to prove statistically, try convincing your village consumer anecdotally! Instead, what we found from speaking to people is that they want toilets for safety (vs. traveling early in the day / late at night for open defecation), convenience (especially when ill / for the elderly), and privacy – all far more tangible.
  3. Real: While the benefit may be tangible, it’s important that there be a need for it – else you’re just a very good solution in search of a problem that may not exist. A hallowed business model in rural sanitation is that of a one-stop shop, and one of its main value propositions is convenience. Of course it is more convenient, but do consumers value that? What we saw was that farmers or agricultural workers finish their day’s work in the morning and have a lot of free time later – they’d rather use this time to buy all the materials, than pay someone a commission to do it for them.

 

2. Even if affordability is an issue, people don’t want a ‘cheap’ solution

With toilets, as with cars, people want quality, albeit at a low price. ‘Cheap’ is not a value proposition, ‘value for money’ is. And when offered a cheap solution, people who otherwise wanted toilets did not buy. “If we have to get a toilet, it has to be a quality one”. Convincing people that your low-cost solution is also high-quality is critical.

 

3. To convert customers, ability and triggers are as important as motivation

According to BJ Fogg’s Behavioral model, behavior change is driven by motivation, ability and triggers. This holds even for sanitation behavior – if you want a consumer to construct a toilet, driving ability and triggering purchase are at least as important as motivating purchase. One single step to increase ability to purchase – financing – has disproportionate impact on toilet adoption. Similarly, from a usage point of view, a household that constructs a toilet will not use it if procuring water is inconvenient – ability or ease of use is critical.

Financing also triggers purchase among households that can already afford toilets. One such household took a loan of Rs. 5,000 to construct a large toilet, with an attached bathroom, a shower, and a large septic tank – and they use it religiously (toilets vs. temples, anyone?). This cost at least Rs. 60,000 to construct – they could have, of course, constructed a toilet without financing, but that was the trigger.

 

4. Skin in the game is important, to drive usage

Over the last 10-15 years, toilets have been constructed with government subsidy for rural households across the country. But usage is markedly lower when households contribute neither materials or money, according to last year’s SQUAT report on sanitation usage – none or only a few household members use it. Financial participation keeps people’s skin in the game and drives long-term usage. Maybe it’s a good thing most people don’t understand sunk cost.

 

5. Choice is helpful. But don’t make a user choose between a Nano and a Mercedes

Giving customers choices (but not too many) is definitely more helpful than one-size-fits-all. This is not a new insight. But when you offer three toilets at prices of Rs. 10,000, Rs. 15,000 and Rs. 25,000 respectively, consumers buy none of them – this was an unexpected response during our business model pilots (easily explained in retrospect of course – hindsight is 20:20). The reason is that over 90% of people in most villages in Bihar cannot afford a Rs. 25K toilet – it’s the rural toilet equivalent of a Mercedes. And when you offer a middle-class prospective buyer a Nano and a Mercedes in the same choice, you cause decision paralysis. He may have come in considering a Nano, but he changes his mind on seeing the Mercedes – “Maybe I can save up over the next few years to get a Merc.” He may come back 5 years later or he may not, but he’s no longer a prospective customer today.

Choices need to be from the same cohort – Nano vs. Alto vs. Indica is an easier decision to make, and even easier is a choice between A/C and non-A/C variants of a Nano.

 

As I’ve been setting up my own business, I’ve remembered each of these learnings multiple times –  initially as rationalizations for observed user behavior, but later more and more to predict user reactions. But my most important learning of all – reinforced by every piece of user feedback I receive on my app and every user grievance I address every day – is that users are who they are, and they want what they want. Take that as a given, and try to deliver that value through your product. If you’re trying to tell a consumer what to want, well, good luck to you!


PS. You can read more about our Bihar work and the business models we developed here.

PPS. I must thank Monitor (now Monitor Deloitte) and Monitor Inclusive Markets (now FSG India) for the opportunity to work in sanitation for so long. Of course, this post doesn’t necessarily represent the views of these two companies, and the people I worked with.

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Pregnant mothers – the holy grail of retail

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Retailers try many tactics, some obvious and others devious, to take advantage of our buying habits and maximize how much we purchase. They also use purchase data and buyer demographics to identify their most valuable customers, and make them purchase more. Nothing surprising there. But what’s interesting is that across retailers, one customer archetype is consistently the most valuable – pregnant and new mothers.

I recently read The Power of Habit, which outlines the process by which we form habits and explains how we can modify them or create new, more constructive habits. It’s a fascinating and insightful read, and I’m going to try changing some of my habits using this framework (no more candy for me!).  But this post is not about the habit process (read the book, lazy people!). The book had a very interesting chapter on retail habits, and how retailers take advantage of them.

Some of these retailers’ tactics are pretty obvious – think of how you have to walk all the way across the mall in search of a staircase. Studies have found that over 50% of your purchases are impulse buys – and this is if you made a list beforehand! So, making you walk across the mall, seeing more products than you would otherwise, will make you purchase more. Slightly more devious is how supermarkets keep fruits and vegetables right near the entrance. If we stock up on healthy stuff right at the start of a shopping trip, we feel great about ourselves and are much more likely to stock up on chocolates, biscuits, chips, ice creams, etc. when we encounter them later. There are many more such tactics employed by retailers to take advantage of our habits – you can see a few more here.

These habits – buying what we see, weakening after buying healthy products, etc. – are ingrained, as are our choices for where we buy specific products. Tactics to take advantage of these habits are now table stakes. But where retailers can make the most impact is when habits change. And even ingrained habits change – typically during some major life change or emotional upheaval.

For example, when people get married, they’re more likely to start buying a new brand of coffee. When they get divorced, there’s a higher chance of them trying different kinds of beer (and of course, more beer). And what’s the most major life change there is? No prizes for guessing (especially since I let the cat out of the bag in the title) – it’s the birth of a child.

Given the sea change in lifestyle that occurs with the birth of a child, new or expecting parents are particularly flexible to changing their buying behavior – more than any other consumer segment. As a result, they are a gold mine for retailers.

  1. They buy a lot of new products – diapers, wipes, cribs, prams, blankets, bottles, etc. – that they haven’t bought before. Surveys in the US have shown that new parents can easily spend over $10,000 on baby items before their child’s first birthday!
  2. They’re less price sensitive: New parents are highly price insensitive; they’re less likely to cringe at high prices. When you’re heavily deprived of time and sleep, you want to make quick decisions on baby purchases – you’re going to buy a lot of them! Therefore, retailers always manage to sell such products at a hefty profit.
  3. They prefer buying everything in one place: Being sleep-deprived also means that you value ease and convenience over anything else. Therefore, new parents tend to buy everything they need in one place. If they come to a particular store to buy diapers, they’re more likely to buy juices, snacks, groceries, clothes, etc. there as well.
  4. And given that these new habits will also quickly get ingrained, they will remain loyal and valuable customers for years (till their next child, at least).

Given these factors, new mothers are the most valuable customer segment there is. Getting one into your store to buy just diapers today can have significant revenue and profit impact for years to come. Retailers, therefore, try a lot of different tactics to catch these customers in time. It’s easy to find new mothers – just go to a maternity hospital! The book talks about how P&G, Disney, and others have giveaways for new mothers at hospitals.

But if everyone is targeting new mothers, you need to target them even earlier to capture them – when the woman is pregnant. As a retailer, one can mine purchase data for different customers to know what people who are buying diapers today were buying six months earlier. Using these correlations, one can then start tracking families where the wife is pregnant, in real time. Of course, finding out that you know this can creep families out quite a bit. It can also lead to very sticky situations, like this one!


This is just one interesting tidbit from an excellent book. Do give it a read. Would love your feedback on this post – do comment here / email me at gt.jithamithra@gmail.com / tweet to @jithamithra. And yes, subscribe – I write about startups, books, consumer behavior, etc. once a week, and I promise not to spam you.

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