Tag Archives: platform controls

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Habit Forming Platforms Part I

In my previous blog I had talked about Technology Evolution & touched upon how we have seen waves come in and go. I am converting that into a series of posts. First of the many posts related to Habit forming products & platforms. It captures my reflections around customer engagement mostly inspired from my readings of the book by Nir Eyal : HOOKED : How To Build Habit-Forming Products 

Nir Eyal is an Israeli-born American author, lecturer and investor known for his bestselling book, Hooked: How to Build Habit-Forming Products.  He teaches and has expertise in areas of psychology, technology & business.

Everybody you meet , there is always a common thread on talks of how to improve customer engagement. I also do realize that we are trying to make sincere efforts to improve it all the time but still keep failing at it ! It is important to retrospect why this is the case and why do we keep losing engagement from our customers , not making the value proposition compelling enough to keep their attention live and fresh !

When I started reading the book , it became very clear to me how forming habits is imperative for the survival of many products. The current pandemic is a living example where the consumption patterns and habits are rapidly shaping to create survivability  , continuity , & pivoting away from the pandemic.

Back in 2001 , when I joined the industry internet was coming out of womb and world was still about rich desktop applications. Some of us would remember Power Builder front-ends on Windows ! People at that time would expect the technology on web to be just like that , comparison point of totally then divergent tool sets ! there was expectation that web should replicate every aspect of experience there by underscoring the other tranformational impact of internet.  It was a struggle on how to manage this transition with scores of teams involved trying to get this right .  the books offers a set of learning on how such situations should be addressed from a platforms stand-point.

  1. Companies need to change behavior by presenting users with an implicit choice between old and new.
  2. Platform services should be enjoyable for the sake of its customers.
  3. Building Platforms that are marginally better than others will never shake the old habits of customers , with broad adoption base.

A classic paper by John Gourville , a professor of marketing at Harvard Business School stipulates that

Many innovations fail because consumers irrationally overvalue old while companies irrationally overvalue the new.

As we build platforms

  • We need to be better by  miles to even stand a chance for customers to get hooked to us.
  • If the platform and products require high degree of behavior change , then they are doomed to fail even if the benefits of using the new product are clear and substantial !
  • We need dramatic improvement to our software design or restatement of problem to break the users out of their old routines. 

Quoting another example from the book is that of the QWERTY keyboard , which was developed in 1870s ! Simply putting this layout prevented users from jamming metal type bars of early machines. Many people have tried to since then reinvent keyboards and relate it to better ergonomics BUT QWERTY still remains a standard. How does it survive ?

For a simple reason that there is very high costs attached to changing the user behavior and challenge the stored value for it within its customers. The whole process of relearning and adopting stands little or very less chance of success!

Business heads , platform architects , designers & developers need to:

  • Engage
  • Gauge
  • Modify

to make important decisions regarding how platform should be developed to trigger engagement for customers to get hooked to it.

We will talk in upcoming blog posts more around how to challenge and change the stored value in customer’s mind in order to increase likelihood of adoption. In the mean time , if you have any feedback or comments , please do share !

 

Platforms & More…

It has been time since I shared any thoughts. Have been irregular for sames reasons always .. caught in web of work and finding time for everything ! I tend to forget always that “yes I can do anything but I cannot do everything !” . Enough of self-infliction , will try to get back into groove and be honest to myself to do things which I like doing !

I am an avid read of Founding Fuel(who have the vision of creating  playbook of entrepreneurship through multi-channel knowledge sharing using their esteemed network of thought leaders) . While reading one of their articles from last week , I found it interesting enough for sharing it as blog post with some personal retrospection on it.

Read On…

Roughly last week on Founding Fuel an article was published about how much control is too much control for a platform. This article talks about some interesting history in early 1930s of how one the Bell Lab engineers Clarence Hickman developed a working model of answering machine but the underlying technology around magnetic storage and the research around it was shutdown by Bell Labs due to reasons related to people’s perception in relation to its usage and ramifications thereof on Bell Labs future ( Remember that Bell Labs remains most prolific entity in world that would have produced most Nobel laureates outside university / academia infrastructure as private company !) ( refer Tim Wu On the Master Switch )

Another powerful example is related to guiding principles of TCP/IP by Vint Cerf and Robert Kahn aimed at interconnecting computers. It had no central control and does not offer any specific optimization for an application. an extreme end of platform design

Above and many other examples mentioned in the article relate to following facts:

  • Businesses heavily control platform strategy
  • Controls are often misguided with too much or / less making a platform subservient to stakeholders or / negative usage
  • Enterprises struggle with definition of platform success
  • Enterprises struggle to see if the platform is balancing act for every stakeholder
  • & Platform itself does not know when it has failed on above parameters!

Now-a-days technology has made it possible to create a platform vision as a foundation to any business idea , but its economic model definition remains conflicting and suited to business itself on how it sees or visualizes the same but it is important to keep referring to core definitions of a platform business.

A platform is a business model that

  • Creates value by facilitating exchanges between interdependent groups. To make these exchanges happen, platforms harness and create scalable networks or users and resources.
  • Platform business needs to facilitate transactions and boost efficiency from the perspective of supply, demand or supply-demand relation.
  • A platform business, should ensure that transactions are carried out efficiently and profitably.

For a platform business, the essence is to ensure that transactions are carried out efficiently and profitably.  The key, undoubtedly, lies in whether a platform can deliver increased transaction efficiency from the perspective of supply, demand or supply-demand relation?

If a business can manage that, it will be able to rise above the fierce competition , ensure effective guardrails with inversion of control , and eventually grow bigger. When it grows bigger in terms of economic value than the creators itself , it starts to become a platform .