SXSW Day 2: Forget Loyalty, Build Habits

S

My second day was a good one. I went to see the session entitled Forget Loyalty, Build habits with the VP/Digital for Julep Beauty, @lesliefeinzaig. Leslie is a gamer and has a gaming background so she has had some experience with building habits. Her goal with Julep is to create habits for influencers and as she said, “information is their social currency”. This information helps the influencer become/maintain their status as the destination for people who want the inside scoop. We’re all tired of this word but influencers are curators. The premise of the lecture was that you can’t rely on users to make conscious decisions and that you need to turn them into habitual users. You have to get them to bypass thinking. “Thinking is exhausting!” and 40% of what we do every day is out of habit.

She then mapped out the habit loop. This is of course a circle because you’re never (ever) done.

Visual cue – In her opinion the cue needed to be visual. I agree with this and posted a while back how if you take the audio out of video ads, you remove the annoyance. Push alerts or changes in the app interface come to mind. This should also be one challenge at a time and make sure you segment them before sending them anything.

Action – What do you want them to do. You have a very short period of time – 3 seconds in fact – to get them to understand what it is that you want them to do. Tap on an offer. Swipe left for more information.

Reward – The reward should be casual, immediate and give them a quick dopamine moment. This should be with some frequency at the beginning and as time goes on, the rewards will be less frequently and the game increases in difficulty.

An example of this strategy can be found in the Julep Maven offering. (Julep is interesting. 90% of their sales come from online while the rest of the makeup market gets 90% of it’s revenue from brick and mortar.) The goal was to create a feeling of having your birthday once a month.

So how does one create a habit loop? Here are her recommended steps.

Observe & Ask – This is will help with behavioral segmentation. What kinds of cues your customers will respond to? What kinds of actions are most natural? What types of rewards will resonate? Observing quant/qual data is great AND I much prefer to talk to customers to get their take on things.

Design your loop – Based on what you learned in the observe/ask phase, you’re now read to create your loop. This will be dependent on where the interaction is. Is it a site? An app? A (mobile optimized) email campaign?

Strip it down – Many times when the creative juices get flowing, a team will blow things out and create an amazing experience. A habit loop is not the place for that. You need to keep it simple. (Especially if mobile experience.) The “depth” of the experience can increase as the customer interaction continues over time but one of the keys of onboarding a new customer (n00b) is simplicity

Test and learn – Believe it or not, you may be wrong about some of the items you were sure would work. (Happens to us all.) It’s best to go into this what software companies call an agile process in mind. This simply means that you assume you’ll need to update based on what you learn and keep iterating until you get it right.

Build it up – I would have titled this deepen the experience. To me that metaphor works so much better. Deeper relationships are the best.

By Michael Myers

I'm an Associate Teaching Professor of Digital Marketing at the Daniels College of Business, University of Denver. I also consult with startups and established brands. I'm currently interested in artificial intelligence, cognitive neuroscience and culture. I am married to an amazing woman and have two incredible children. I was raised in Colorado and spend my free time with family, cycling, snowboarding and going to the Pacific Ocean to SCUBA dive + surf. I'm passionate about architecture, design, street art, photography and tattooing.

Connect