TOGETHER WITH DOVETAIL

Dovetail’s biggest launch is coming in October - and you’re invited!

Get ready for the next generation of customer insights. Dovetail is launching tons of new features and THREE new products that each leverage AI to its cutting-edge capacity. To celebrate this momentous milestone, you’re invited to:

• Exclusive in-person and online launch events

• Sneak peeks and early access to the new products

• Q&As with our product team and founder

Plus special promotions and premium content. If you want to know what the future of AI-powered customer insights looks like - sign up to our waitlist and we’ll keep you in the loop for our events and more!

Please support our sponsors!

Enjoying this content? Subscribe to get every post direct to your inbox!

📅 GEEKS OF THE WEEK

5 bookmark-worthy links:

• Graphite’s Surprising Findings on AI and Search

• How to keep SDRs engaged (love this)

• SaaS is dead?! - what’s the real scoop on Klarna ‘ditching Salesforce for AI’?

• The Post-IPO Trough of Sorrow

• How to Improve Retention: The Ultimate Guide for Product Managers and Leaders

🧠 GEEK OUT

How to Build Products That People Crave (Part 2)

Last week in Part 1 of this post I covered the principles of Priming, Loss Aversion, and Social Proof and how to apply them in your product.

And today in part 2 I’m continuing with

• Scarcity and Urgency

• Defaults

• Cognitive Biases

As well as the critically important topic of ethics.

No messing around, let's dive in!

4. Scarcity and Urgency: The FOMO Effect

Ever noticed how you're more likely to want something when it's in short supply?

That's the scarcity principle in action.

Pair it with urgency, and you've got a potent cocktail for driving user action.

These are the ways it’s typically applied in growth:

• Limited Availability: Highlight when stock or spots are running low. "Only 2 rooms left!" is a classic example from the booking.com playbook. This creates a sense of competition and scarcity, driving users to act quickly. While less relevant for B2B SaaS it can still be used for things like early access to new features/products (see ‘exclusive access’ below)

• Time-Limited Offers: Use countdown timers for special deals or limited-time features. Time-limited deals create a sense of urgency that drives immediate action.

• Exclusive Access: Offer early bird or beta access to new features. This not only drives adoption but also helps gather valuable feedback. At Snyk, there’s an opt-in beta feature programme called ‘Snyk Peak’ and while it wasn’t time limited it felt exclusive.

• Seasonal Promotions: Create urgency around specific times of the year. For example, “Black Friday" deals in tech can drive significant user activity / monetisation.

Every time-limited free trial uses urgency and loss aversion.

Trials are ‘use it or lose it’, with either complete loss (in a free trial model) or partial loss (in a freemium / reverse trial model, as in the example from Buffer below).

Some tips for implementing scarcity and urgency:

1. Identify natural scarcity in your product (limited seats, time-sensitive offers, etc.)

2. Use real-time counters to show available spots or time left

3. Be transparent and honest about your scarcity claims. If you claim an offer is available for the next 24h and you leave it running beyond that, people will feel hoodwinked, so be prepared for backlash!

4. Test different urgency tactics to see what resonates with your audience

5. Monitor user feedback to ensure you're not creating negative experiences

Overusing these tactics can lead to urgency fatigue. 

Users might start ignoring your prompts if everything is always urgent.

The key is to use these scarcity and urgency sparingly and authentically.

5. The Power of Defaults: The Path of Least Resistance

Humans are, well, human.

We often stick with pre-selected options, even when alternatives are available.

This is the default effect, and it's a PLG nugget.

Here’s a few common applications:

• Subscription Renewals: Most subscriptions default to auto-renewal, significantly boosting retention rates.

• Feature Opt-ins: Pre-selecting certain features or settings can increase adoption. For instance, it’s common for products to have various notifications turned on by default.

• Recommended Plans: Highlighting a recommended pricing tier can influence purchase decisions. In one of the companies I advise we found that marking the middle-tier plan as recommended (including some other visual cues) increased its selection by 30%, with the vast majority coming from the lower tier plan.

• Onboarding Choices: Providing smart defaults during onboarding can streamline the process and increase completion rates.

Netflix's autoplay feature is a classic example.

By automatically starting the next episode, they leverage the power of defaults to increase viewing time and engagement.

This simple default significantly boosted user engagement and retention for them.

But they also faced a ton of backlash about originally not being able to disable the ‘feature’ - so they later enabled an option for that.

Here are a few best practices and tips when implementing defaults:

1. Align them with user goals and product value

2. Ensure transparency about default settings

3. Regularly test and optimise your default options

4. Provide easy ways for users to change defaults if desired

5. Consider personalising defaults based on user/team behaviour or preferences

Remember, the aim is to enhance the user experience (engagement and growth will follow), not to trick users into actions they don't want to take.

Ethical implementation of defaults can significantly improve user satisfaction and product adoption.

6. Cognitive Biases: The Quirks of the Human Mind

Our brains are amazing, but they're not perfect.

We all have cognitive biases – systematic errors in thinking that affect our judgments and decisions.

Understanding these biases can help you design more effective user experiences.

Here are a few key biases to consider:

• Confirmation Bias: People tend to favour information that confirms their existing beliefs. You can lean into this by pinpointing the positive beliefs your target audience holds about your product (e.g. from testimonials, reviews, or sales calls, community discussions etc), and then reinforcing them in your messaging. It can become a self-fulfilling loop.

• Anchoring Bias: We rely heavily on the first piece of information we receive. In pricing strategies, you can leverage this by presenting a higher-priced option first, making subsequent options seem more reasonable.

• Availability Heuristic: People overestimate the likelihood of events they can easily recall. If something is readily available in their memory, they assume it's more common or important. You can use this to your advantage by making frequently used features more accessible and visible. Snyk applies this principle by highlighting recent critical security vulnerabilities in the dashboard, which drives fix behaviour.

• Bandwagon Effect: People tend to do or believe things because many other people do the same. This ties closely with social proof. Showcase your growing user base or popular features to leverage this bias.

• Framing Effect: The way information is presented (or framed) influences decision making. For instance, a "95% success rate" sounds more appealing than a "5% failure rate", even though they represent the same data.

When designing for cognitive biases:

1. Identify which biases are most relevant to your product and user journey

2. Design interfaces and messaging that account for these biases

3. Use clear data visualisation to counter misperceptions

4. Provide balanced information to help users make informed decisions

5. Regularly test your designs to ensure they're effectively addressing relevant biases

The Ethics of Applying Behavioural Psychology in PLG

Now, let's tackle the elephant in the room: ethics.

As we've explored these behavioural psychology principles, you might have felt a twinge of discomfort.

I’ve felt the same at numerous times in my career when thinking about this stuff.

Are we manipulating users?

Where's the line between influence and coercion?

These are crucial questions that everyone in product and growth needs to grapple with at some point.

Tread Carefully on The Ethical Tightrope

Applying behavioural psychology in PLG is like walking a tightrope.

On one side, we have the potential to create intuitive, user-friendly products that genuinely improve people's lives.

On the other, there's the risk of exploiting cognitive biases for short-term gains at the expense of user well-being and trust.

Here's my take: the key is to always, always prioritise user value over conversion metrics.

If a tactic doesn't ultimately benefit the user, it's not worth implementing, no matter how good it might make your short-term numbers look.

If you don’t heed this advice, it will come back to bite you.

Play The Long Game

Ethical application of behavioural psychology is not only the right thing to do, it's also good business.

In the short term, you might be able to boost conversions through manipulative tactics.

But in the long run?

You'll erode user trust, damage your brand, and ultimately, fail.

When you focus on creating genuine value and using these principles to enhance user experience rather than exploit it, you’ll not only sleep better at night, but you’ll also see better long-term results.

Your users will stick around longer, and they'll be more likely to recommend you to others.

Can you say ‘PLG’?!

Ethical Framework

So, how do you ensure you're on the right side of the ethical line?

Here's a simple framework I’ve found works well:

The Responsibility of Growth Teams

As growth professionals, we have a responsibility.

We're not just driving metrics; we're shaping user experiences and, in many cases, influencing people's daily lives.

That's a privilege and a responsibility we need to take seriously.

I strongly believe that it's up to us to be an ethical voice in product discussions.

Push back against short-term thinking that might exploit users.

Champion transparency and user value.

It's not always the easiest path, but it's the right one.

My philosophy is that we're not just building products.

We're building relationships with our users.

And like any good relationship, that needs to be built on a foundation of trust, respect, and mutual benefit.

Wrapping Up

And there you have it, folks!

Six powerful behavioural psychology principles to supercharge your product-led growth strategy, along with a crucial discussion on the ethics of applying these principles.

While much of these two posts have been rooted in concepts – knowing those concepts well gives you a set of practical tools that can drive real results when applied thoughtfully and ethically.

It’s exceptionally fulfilling to create a product experience that your users genuinely love and find value in, and that aligns with your ethical standards.

By implementing these concepts ethically you get to boost growth metrices while building a strong, trusting relationship with your user base.

What’s not to love about that?!

😂 GEEK GIGGLE

SHARE THE LOVE → PROFIT

The PLGeek Growth Process

Get the PLGeek Growth Process

Do you know someone that would enjoy this newsletter?

Share it with them and get access to The PLGeek Growth Process. This is a refined version of the growth process I ran that fuelled growth at Snyk and countless companies I’ve advised.

You currently have 0 referrals, only 1 away from receiving The PLGeek Growth Process (PDF).

Or just share this link with them: https://www.plg.news/subscribe?ref=PLACEHOLDER

💪 POWER UP

If you enjoyed this post, consider upgrading to a VIG Membership to get the full Product-Led Geek experience and access to every post in the archive including all guides. 🧠

THAT’S A WRAP

Before you go, here are 2 ways I can help:

Book a free 1:1 consultation call with me - I keep a handful of slots open each week for founders and product growth leaders to explore working together and get some free advice along the way. Book a call.

Sponsor this newsletter - Reach a large and growing audience of founders, leaders and operators working in product and growth at some of the world’s best tech companies including Paypal, Adobe, Canva, Miro, Amplitude, Google, Meta, Tailscale, Twilio and Salesforce.

That’s all for today,

If there are any product, growth or leadership topics that you’d like me to write about, just hit reply to this email or leave a comment and let me know!

Until next time!

— Ben

PS: Thanks again to our sponsor: Dovetail