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Why getting traction is so hard these days

The end of the cycle
One of the best essays written last year was Elad Gil’s End of Cycle? – referencing our most recent 2007-2017 run on mobile and web software, and the implications for investing, startups, and entrepreneurs. Although he doesn’t directly talk about it, the end of a tech cycle has major implications for launching new products, growing existing product categories, because of a simple thing:

It gets much, much harder to grow new products or pivot existing ones into new markets

The reason for the above is that there are multiple trends – happening right now – that impede growth for new products. These trends are being driven by the biggest players – Google/Facebook, et al – but also by the significant leveling up around of practitioners in design/PM/data/growth.

We’ll look at a couple trends in this essay, including the following:

  1. Mobile platform consolidation
  2. Competition on paid channels
  3. Banner blindness  = shitty clickthroughs
  4. Superior tooling
  5. Smarter, faster competitors
  6. Competing with boredom is easier than competing with Google/Facebook

These trends are powerful and critical to understanding why all of a sudden, entrepreneurs/investors are starting to get into many new fields (genomics, VTOL cars, cryptocurrency, autonomy, IoT, etc) in order to find new opportunities. After all, if you can’t grow in the existing markets, you very quickly need to get into new ones, as Elad describes:

One sign that technology markets often exhibit at the tail end of a cycle is a fast diversification of the types of startups getting funded. For example, following the core internet boom of the late 90s (Google, Yahoo!, eBay, PayPal), in early 2000 and 2001 there was a sudden diversification and investment into P2P and mobile (before mobile was ready) and then in 2002-2003 people started looking at CleanTech, Nanotech etc – industries that obviously all eventually failed from an entrepreneurial and investment return perspective.

Nanotech, cleantech, etc was the last cycle, and now we’re talking about the next one.

#1 Mobile platform consolidation
The new Google/Apple app duopoly is more concentrated, more closed, and far less rich (from a growth standpoint) as compared to web – which means that mobile is far more stagnant and harder to break into. App Store functionality like top ranking charts, “Essential” bundles of apps, editorialized “Featured App” sections, all help drive a winner-takes-all mobile ecosystem.

No wonder app store rankings have ossified over the years. Facebook and Google now control most of the Top 10 apps in the mobile ecosystem:

Source: Nielsen, Dec 2016

If you’re introducing a new app – whether unbundling a more complex app or launching a new startup – how do you break into this? There’s not a ton of organic opportunities. And the paid acquisition channels are getting saturated too.

#2 Competition on paid channels
Paying for acquisition is one of the key channels still available, if you can find the right untapped audience segments with high ROIs. This only works when prices aren’t bidded up and you don’t face too much competition for the same ad inventory. Unfortunately that’s not what’s happening.

For example, let’s look at some of the dynamics of Facebook increasing their revenue per DAU over the last few years:

This is driven by a number of factors, of course – relevance, targeting, ad unit engagement, etc. – but it’s also because competition is getting fiercer on Facebook ads, not less, which is evidenced by the rapid increase in the advertiser count as well as the increase in revenue per user. In 2017, Facebook counts over 5 million advertisers on its platform, up from 4 million in Q3 of last year and 2 million in 2015. During its Q1 2017 earnings call, Facebook told investors that it expected ad revenue was approaching a saturation point, despite major growth in Q1 2017 earnings as compared to 2016. It’s currently at 2 billion users, with 17% YoY user growth, and its ability to add more inventory depends increasing its user base, or increasing users’ time spent on Facebook.

#3 Banner blindness = shitty clickthroughs
Additionally, everyone’s getting smarter about growth, including consumers. Today, most invite systems no longer have the same novelty value or efficacy as they did 10 years ago (Dropbox’ give/get was novel when it launched), and consumers’ “banner blindness” extends far beyond actual display advertising to encompass referral systems and virality programs.

In Mary Meeker’s latest internet trends report, she reports that up to 1/3 of some countries are using ad blocking, and we’re quickly on our way to 600M internet MAU who can’t be reached by ads:

This is just the 2017 version of The Law of Shitty Clickthroughs, which I wrote about a few years ago, where I showed some stats indicating that email marketing open rates are on the decline:

… and that traditional banner CTRs seem to be asymptotically approaching zero:

These trends are troubling, and mean that these channels are getting less engagement per user, and we haven’t found amazing new channels to replace them.

#4 Superior tooling – which levels the playing field
At the same time as advertising is getting more crowded, there’s also increasingly widespread availability and adoption of tools like Mixpanel, Leanplum, Optimizely and others that close the gap on being data-driven at companies.

Ten years ago, we used to look at total registered users. Cohort analysis was a sophisticated approach, and we also didn’t have a sense for MAU, DAU or other more granular metrics. One of the killer features of Mixpanel is that it made understanding cohort-based retention turnkey. It used to take a real investment of engineers, data scientists, and know how to be able to create simple graphs like this:

Now, it’s pretty much turnkey. You can get this chart from Mixpanel (and may others!) practically for free, as soon as you implement your analytics tracking.

In B2B, we’re seeing the same phenomenon. Outbound used to be painstaking and manual. Today, there are many sales tools that make outbound more accessible (Mixmax, Outreach, insidesales.com etc), which automates part of the process but also generates more noise and competition. Tasks that used to be more manual and higher friction are automated and easier, which leads to more people jumping in.

The result is that it makes everyone better. You and all your competitors understand your/their acquisition and retention bottlenecks. Everyone has an equal, data-driven shot at improving LTV, and as a corollary can spend more on ads.

#5 Smarter and faster competitors
It used to be that startups could count on their competitors to be big, dumb, and slow. Not anymore. We’ve all gotten smarter and faster, and that includes your competitors. It used to be that you could wait a few years before competitors would respond. Now the Facebooks, Hubspots and Salesforces of the world can and will copy you right away.

Most famously, we’ve seen Facebook fast follow Snap within their Messenger, Instagram, Whatsapp and core product:

But it’s not just consumer where this is happening:

  • Dropbox <> Google Drive
  • Slack <> Microsoft Teams
  • YesWare <> Hubspot Sales

… and many more examples too.

#6 Competing with boredom is easier than competing with Facebook + Google
When the App Store first launched, competition was easy: Boredom. Mobile app developers were taking time away from easy, ‘idle’ activities like waiting in line, commuting etc. But today, acquiring a new app user means stealing a user’s time from their favorite existing app.

As we’re near the end of the cycle, companies have moved from non-zero sum to a zero-sum competition.

Instead of competing with boredom, we’re now competing with Silicon Valley’s top tech companies, who already have all your users (back to number 2 above). This also applies to the consumerized workplace, where new entrants will be competing to steal users’ time from Slack, Dropbox and other favorite apps. This is much, much harder because the incumbents have pretty great products! And proven distribution models to respond if needed.

How the industry is evolving, in response
The above trends are troubling for new products, and especially for startups. All 6 of these trends are scary, and they’ve emerged because we’re at the end of a cycle. There’s a variety of natural monopolistic trends (like app stores, ad platforms, etc), where everything with related to growth and traction is getting harder.

If companies want to stay in the mobile/software product categories, they need to evolve their strategies. I’ll save a deeper discussion for a future essay, but here are some observations on what’s happening:

  1. More money diverted to paid acquisition
  2. Deeper monetization to open up channels – especially paid
  3. Creation of paid referral programs to complement ad buying
  4. Personalization features that rely on lots of data to amp up targeting
  5. Products trying to deepen differentiation by solving hard(er) problems/tech

There seems to be a deepening in both monetization, differentiation, and personalization to help open up growth. This happens by solving more fundamental customer problems – especially those that help generate real $ value for people – but also helps open up paid channels, whether that’s advertising, referrals, or promos.

More discussion on this in a future writeup!

PS. Get new updates/analysis on tech and startups

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Travis – thank you for leading us at Uber

2015
This pic is from two years ago, taken at Uber’s HQ on 11th and Market. After weeks of discussion with the product team, we’d hit the final stretch, and TK and I holed up for a few hours in a conference room to finalize my role at Uber.

There were a couple things that got me over the line: TK’s insanely big vision for Uber, the already huge impact the team was making, and the entrepreneurial culture he’d created. It won me over. We shook hands, TK wrote and signed the offer letter on a sticky note (blocked out for obvious reason!), and took a selfie for posterity. I’ve never shared this photo publicly before, but here it is now. Happier times.

Starting at zero
TK (and RG+Garrett!) started a company at zero that’s creating work for 13,000+ people at HQ and millions of drivers. I want to take a moment to acknowledge – even as we’re at the peak amount of noise in the press – all the amazing qualities that Travis embodies as an entrepreneur and leader, especially in the context of a guy whose last startup had <10 people.

Yes, there are changes that need to be made and passionate folks working on addressing the many serious issues that have been surfaced. It will take years and a lot of hard work, to make that happen.

At the same time, one of the most important startups has been built in the last few years, and they deserve to be called out. Let’s take a moment to do that:

Lead from the front
TK asks his team to work hard, but he works harder than all of us. I remember during my first few months at Uber, I’d have 11pm meetings scheduled with him to talk about driver referrals. After a solid hour-long jam session, he’d say he had to leave to get on a conference call on China, and leave for another multi-hour meeting. And Travis would do this all the time, day in and day out. You never feel like the leadership is resting on their laurels, just dialing it in, because TK wasn’t.

Details matter
As it’s been widely reported, TK cares about the details. He’ll look at your graphs and ask about week-to-week deviations. He’ll ask about the sample sizes on your A/B tests. I’ve worked on projects where he wants to give final approval for the final mockups of flows. TK empowers teams, while simultaneously creating a very high bar for them, because it was constantly reinforced that you had to do things right.

Always available
It didn’t take me long to learn that if a random rider or driver emails Travis on his @uber.com email, he’ll read it and often forward it to the teams to fix ASAP. And he’d often play support, replying and explaining things himself. TK didn’t just do this for customers – but also for employees. Every week during our company all-hands, he’ll take questions from anyone, and answer them off the cuff. He’d commit to following up 1:1, regardless of your seniority or role in the company. This availability made it easy to feel heard, and that you had ownership/input into all the problems we have as a team.

Optimism and energy
Sometimes you have to give good news to people, and sometimes you have to explain that there’s problems. TK often called himself “Chief Problem Solver” and it was because no matter how bad things got, and how down the team would get, he would jump in with energy, ideas, and solutions. And because of his hustle and determination, it meant there was a solution for everything.

It’s these qualities, and more, that’s made Uber so successful. It’s hard to imagine someone else stepping into TK’s shoes, and the bar will be insanely high.

Thoughts from the team
There’s a lot more to say about Travis, but I want to leave all of you with a series of messages on my Facebook feed from my teammates and friends at Uber. This essay came out of me reading these notes and getting inspired to write my own.

Here they are:

Thijs Niks:
Starting a company is hard. Growing its reach globally is tiring. Forwarding to the future faster than anyone else is demanding. Motivating people to exceed their own expectations time and time again is exhausting. Building an organization that scales from 10 to 10,000 people is insanity. Scaling yourself at the same time is grinding.

You know you will make mistakes along the way. You know people will come for you.
And you do it all because you’re pursuing a vision no one else could dream of. You’re building the next version of what this world could be.
Thank you, Travis. We will keep building.

Nikhil Goel:
Thank you, Travis Kalanick, for everything. Thanks for taking a chance on me — it takes an extraordinary CEO to let a 25-year-old kid go PM work on flying cars. Thanks for creating a company with a culture where even that didn’t seem like such a crazy idea. I won’t forget our jam sessions and the lessons you taught me anytime soon — you continue to be an inspiration to me and the thousands of proud Uber employees who carry your vision forward.

Amy Sun:
Heartbroken to hear that Travis is leaving Uber. TK– thank you for your leadership and passion over the years. You are my hero and were such an inspiration to us all.
Thank you for helping us solve the world’s hardest problems through hard work and determination. Thank you for pushing us to always be better. Thank you for putting Uber above all else. Thank you for taking the time to listen and be there for us when we were hurt. Thank you for your support and words of wisdom (and selfies)

Wenqi Shao:
Thank you Travis for inspiring us to change the face of transportation, for being our chief problem solver.

Thank you Travis for creating for me the opportunity of a lifetime to work on China Growth and self-driving cars. Thank you for all the late nights and weekends you spent guiding the teams. For the care and thought you put into every problem, big and small. For designing the future, figuratively and physically. For your ability to jam on the small details to zoom out to the biggest picture. Thank you for your leadership and inspiration. For your guiding light. We will miss you.

Anonymous:
Wherever I go and whatever I do in my professional career, I will always carry with me your huge vision, your larger than life ideas, your big bold bets and your courage. Whatever I do I promise to make it the most big and beloved. I will always be hustlin and truth seeking.

Travis I will miss you but I’ll never forget what I learned from you.

You’ve launched a thousand of us, your disciples, out into Silicon Valley. Let’s fucking do this. Game on.

Margaret-Ann Seger:
I’m angry, sad, flustered, confused, but mostly just heartbroken.

The only appropriate thing to say right now is thank you, Travis. Thank you for inspiring not only your own employees but an entire generation of entrepreneurs. Thank you for inspiring us to think bigger, faster, and higher-impact than anyone has ever dared to think before.
Thank you for creating a place where no idea was too crazy. When we told you that in order to make the product accessible for our international riders we would need to accept cash payments, you weren’t thrilled but you were willing to give it a shot. When your employees told you that we needed to change some aspects of the internal culture, you were sad but you were all ears. Building the best possible product, the best possible company- it requires humility. Admitting you might be wrong and being open to change. I was always impressed by how truly humble you were.

Thank you for creating a place so passionate about bringing affordable, reliable transportation to the whole world that your employees all over the globe were willing to hop on planes, get on Zoom calls at bizarre hours of the day, manually onboard thousands of drivers, stand on street corners handing out flyers to riders, and build last-minute stunt products to help celebrate the communities they were a part of. I’ve seen firsthand the impact this product has had worldwide and the universal fire and passion that Uber employees all over the world have to constantly improve it, to always be serving drivers and riders better, and to perpetually push closer and closer to truly making transportation as reliable as running water, for everyone, everywhere.

Thank you for creating a culture where- as a woman- it was okay to, no, encouraged to speak up. This is one of my oft less-told anecdotes, but I feel it’s appropriate given the circumstances. Before Uber, I was at Facebook. I left Facebook because I was told that I was too aggressive. Pushing too hard, wanting to move too fast, challenging the status quo a bit too much. The amazing part is that coming to Uber was like a homecoming. I could be who I truly am, without being labeled an “aggressive” woman. I could push on assumptions, move quickly, do whatever work needed to be done whether it was “in my area” or not, question leadership in an open, earnest environment. It was like a breath of fresh air. I don’t think people realize how unique this is. This company truly listens to every voice, from the VPs all the way down to the junior PMs like myself. Thank you. Thank you for listening and creating an environment where the best answer truly does win.

And thank you on behalf of your riders and drivers. You’ve created millions of earning opportunities for drivers all over the world. From the part-time student teacher driver to the full-time driver in India, these are real economic opportunities at an unprecedented scale. I’m always amazed talking to drivers in India or Indonesia or Mexico or Kenya- their story is not too dissimilar from the drivers I talk to on my way home from work in SF. Uber has allowed them to build a better life for their family- to send their kids to school, to work more flexible hours so that they can be there for their family. Not to mention the newfound mobility that Uber affords millions upon millions worldwide. Elderly folks & teens can now access their city, stress-free. People can go out for a drink- or three- and get home safely without endangering those around them. Uber is fundamentally reshaping people’s transportation habits and how they interact with their cities. This kind of impact would have been unthinkable only a few years ago, but we’ve made it a reality- thanks to your vision.
So thank you. We’ve mis-stepped at times- I’ll be the first to admit that Uber is not perfect. But the positive impact you’ve had on this company, and the world, is truly inspirational.

Goodbyes always suck. Thanks to the OG Builder.

Thank you Travis.

PS. Get new updates/analysis on tech and startups

I write a high-quality, weekly newsletter covering what's happening in Silicon Valley, focused on startups, marketing, and mobile.

Psych’d: A new user psychology framework for increasing funnel conversion (Guest Post)

[Hi readers, my good friend Darius Contractor (currently growth eng at Dropbox) has a brilliant new framework how user psychology has driven growth at companies like Bebo, Tickle, PhotoSugar and of course, Dropbox. Thanks to Darius and the folks at Reforge for putting this together. Hope you enjoy the writeup here! -Andrew]

Increase your funnel conversion by getting users Psych’d – by Darius Contractor

Have you ever wondered why people are bouncing from your nearly-frictionless onboarding flow? Why the same change can result in a lift on one page and cause drop-off on another? Or why people who find you via search bounce away after a few moments?

Having spent years focused on building experiences that got millions of users sharing, onboarding and inviting their friends, I’ve learned 2 things:

1. Every element on the page adds or subtracts emotional energy
2. Inspiring users is as important as reducing friction

A secret of the top growth experts in tech is to think about every UX interaction as an emotional event. But far from being random or beyond our control, emotion-driven interactions can be broken down into components, optimized at each step and replicated to get better results for onboarding and conversion.

The Psych Framework

Today I’m sharing the Psych Framework I’ve used to help grow companies like Tickle, Bebo and Dropbox. It is a systematic way to detect and improve the way an experience affects user emotional energy, which we call “psych”.

User Psych Framework by Darius Contractor

Every UX interaction increases or decreases Psych, the unit of measure for motivation to complete an action.

Every element of a webpage either inspires us by giving us more units of Psych or overwhelms us by depleting our existing store of Psych.

Once you understand what elements are adding to or depleting users’ energy, you can then start to manage that energy: adding inspiration and minimizing overwhelm to help users take your core actions.

Psych Units

We measure user energy in units of “Psych”, from 0 to 100.

User psych fuel gauge measures unitsA user at 100 Psych is maximally committed to their current experience, does not need further motivation, and will overcome most challenges. For example, a person who needs to file their taxes tonight will do whatever it takes to download their W2 from their company’s payroll site. They’ll complete a forgotten password step, suffer through a poor interface they’ve never used before, and read through confusing numbers in order to get their taxes done in time.

A user at 0 Psych is exhausted and disinterested, to the point of abandoning their current experience. For example, a person accidentally clicking on an ad who realizes they’ve ended up on a scam site will have no motivation to continue and will bounce.

Psych Elements

Being aware of +Psych in your UI can massively drive user excitement/growth:

Tinder: “Discover new and interesting people nearby” → Yes, let’s!

Likewise, being unaware of the -Psych in your product can massively decrease success:

Global Entry site: “Fill in 40 form fields about yourself” → Ugh, maybe later… <closes browser>

We call elements that inspire users and add to their emotional energy +Psych.

If a car rental site pitched “Get your car for $15/day” that might be a +Psych, inspiring users to try to get this good deal. Inversely, -Psych are items that tire or overwhelm users, such as long sign up forms, unclear UX, too much text, and unclear next actions.

Let’s test drive this concept with Match’s home page. After that, we’ll talk about what to look for in your flows and examine what Airbnb gets right in their host sign-up experience.

Example 1: Match’s homepage

Match homepage user psychology
How do we evaluate the Psych score of this page?

1. Determine your starting Psych

To understand how much Psych a user has when arriving to a site, consider how they got there.

For example, users who arrive on Match through a Google Search are high-intent and have intrinsic motivation since they’re explicitly searching for dating. So they’re around a 60 Psych.

By contrast, visits from banner clicks would likely be low-intent since their clickthrough came in response to an external trigger. They’re perhaps a 30 Psych.

A referral from a friend might result in a clickthrough that’s low intent but has high social validation. So, they might be at 50 Psych.

2. Follow the user’s attention from top-left to bottom-right

In left-to-right languages like English, we consume content from top-left to bottom-right. As we follow our natural path across the page, our Psych will either go up or (more likely) down as we encounter elements that excite us or elements that are obstacles.

On the Match homepage above, these are the elements we encounter from top-left to bottom-right:

  • Logo
  • Photos of singles
  • “#1 in dates, relationships and marriages”
  • Demographic form
  • “View Photos »” button

As you can see, right after the logo assuring us it’s a real company entity that we can trust, we see appealing photos of smiling people. Then we see the byline “#1 in dates, relationships and marriages,” which assures us that we’re going with the best site and that it’s there to help us achieve dates, relationships, or even marriage.

Next, there’s a form, which requires action that potentially depletes Psych. But we’re spurred on by the “View Photos” button — which is exactly the thing a user interested in “dates, relationships, and marriage” wants to do at this point.

3. Which elements are +Psych for you? Which are -Psych?

Let’s run through the Match homepage again and tally up Psych, element by element.

Match homepage user psychology each step animated
These are the + Psych elements:

  • “Ooohh, these people look attractive!” → +10 Psych
  • “They’re #1? And I can get dates/relationships/marriages?” → +3 Psych
  • “I like that it defaults to Woman seeking Man.” → +3 Psych
  • “Nice, can’t wait to View Photos” → +8 Psych

These are the – Psych elements:

  • “Hrm, what age am I looking for?” → -5 Psych
  • “Why do they need my zipcode? Argh, keyboard…” → -10 Psych

4. Sum it up!

Tally up all the Psych elements to see where users are by the time they get to your call-to-action.
Greater-than-zero Psych means the user got through the flow.

  • Starting from a Search: 50 Psych
  • +Psych: 10+3+3+8 = +24 Psych
  • -Psych: -5-10 = -15 Psych
  • Result: 59 Psych → They made it!

Next, we’ll go through some of the top +Psych and -Psych factors across common pages.

Maximizing Psych on each of your pages

1. Assess initial Psych

People come to your site with an initial quantity of Psych.

If you’re hungry at noon and haven’t eaten all day, then your Psych level for a sandwich will be very high. That will help you power through the friction of standing in line, deciding between options, and pulling out your wallet to be saved by an $8 hero.

Therefore, the first step to evaluating Psych is to look at factors determining how much Psych people have when they enter your funnel:


2. Psych on the landing page

Once a visitor hits your landing page — great! You now have multiple chances to increase their Psych to get them to continue to signup or, if you’re not careful, decrease their Psych and cause them to bounce.


3. Enter personal info

At some point, you’re going to have to ask your visitor to enter some personal information, even if that’s just their email address.

Asking for personal information usually creates a negative Psych moment, whether it’s because people are wary to share their information or because they’re simply feeling lazy and don’t want to complete an input action.


4. Interact with product

If you have a freemium or free trial model, your user will get a chance to interact with the product before it’s time to pay. This is a chance to increase Psych before the user gets to the Psych-depleting payment action.


5. Enter payment information

For most businesses, eventually it’ll be time for users to enter their payment information and complete a transaction.

This is the ultimate Psych-depleting action because of the psychological phenomenon of the pain of spending money.

While we might think that the purchase action should be Psych-increasing because of the anticipated pleasure of acquiring something we want, it actually triggers the same area of the brain as for physical pain. So, spending money = pain.

But, MIT researchers found that credit cards increase detachment from purchases. In other words, credit cards help decrease the pain we feel from spending (cash) money.

Aside from the inherent pain and negative Psych of spending, there are still things you can do to improve Psych at the payment step.

Decreasing cognitive load is more than just short signup forms

The above is a basic framework anyone can go through for figuring out the ups and downs of Psych within an onboarding flow.

But optimizing Psych isn’t just a matter of removing clicks and reducing text. In some cases, more detailed forms or copy can help by decreasing the cognitive load on making the decision — even though it’s technically more effort. For example, including more information about security and money-back guarantees can overcome trust barriers and alleviate fears for big purchases.

Now let’s look at another live example.

Example 2: Airbnb’s hosting flow

Let’s go through a more complex example — becoming a host on Airbnb.


How do we evaluate the Psych score of this page?

1. Determine your starting Psych.

To figure out the ups and downs of Psych for someone who’s thinking about hosting on Airbnb, let’s start with their mindset before they hit the landing page.

  • They might have heard some stories about making a lot of money on Airbnb → +20 Psych
  • They might have heard about it being lots of work or a negative hosting story → -10 Psych

But ultimately their positive starting Psych is greater than their doubts and they are motivated enough to check it out.

2. Follow the user’s attention from top-left to bottom-right

Airbnb offers three different ways for becoming a “host” on the platform:

  1. Renting a house or apartment
  2. Helping neighbors with their Airbnb listings
  3. Leading a tour or other travel experience

To keep it simple for this post, we’ll just look at the core Airbnb “host” action — renting a house or apartment.

As you follow the user’s attention from top-left to bottom-right, it’s pretty clear that Airbnb knows what its hosting users care most about — making extra money by renting out their places.


Here are the immediate elements we encounter above the fold, from top-left to bottom-right:

  • Logo
  • “Earn money” value proposition
  • An interactive calculator to see how much you could earn
  • A “Weekly Average” box with an impressive earnings estimate and a dollar sign

From there, the page displays more content aimed at increasing Psych and reducing doubt:

  • Tactical instructions that demystify how Airbnb works
  • Reassuring details about safety and security, like their host protection insurance and their $1M guarantee for hosts
  • Social proof in the form of a video featuring a diverse handful of hosts talking about how income from Airbnb has helped them to stay in their homes, pay for medical bills, or fund a retirement.

Because users have to log in to continue the host flow, Airbnb’s goal on this first page is to drive up Psych high enough to carry them through the subsequent, more tedious steps in the flow — logging in or creating an account and setting up their first listing.

3. Which elements are +Psych for you? Which are -Psych?

Now let’s run through and tally up Psych, element by element.

Airbnb does a good job of loading up the page with +Psych elements because they know they’re asking a lot of the user:

  • “Earn money? Yes please.” → +10 Psych
  • “I can rent out an entire place, or a room, or just a couch? Then there probably is something for me.” → +5 Psych
  • “$741 weekly average… higher than I thought.” → +10 Psych
  • “Host insurance, and a $1M guarantee that protects my stuff… ok phew.” → +4 Psych

4. Sum it up!

Once again, you can tally up all the Psych elements to see where users are by the time they get to a call-to-action. Remember, greater-than-zero Psych means the user clicked the “Sign me up” button.

This is a simple tally of Psych on just one of the pages of the Airbnb “become a host” flow. There are obviously many more steps before a user becomes a successful host that’s contributing to the marketplace. With that in mind, you can run through the Psych Framework at each step of your onboarding or conversion flow to find opportunities to reverse -Psych and increase +Psych.

So that’s the psych framework in a nutshell. Tell me what you think in the comments and if you’d like to hear more.

-Darius

Disclaimer: I’m a Dropbox employee, but I’m not posting on behalf of Dropbox or in an official capacity as a Dropbox employee. This post was originally published here.

PS. Get new updates/analysis on tech and startups

I write a high-quality, weekly newsletter covering what's happening in Silicon Valley, focused on startups, marketing, and mobile.

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Quick announcement: The Backstory, a private discussion forum for tech, marketing, growth

Uber’s virtuous cycle. Geographic density, hyperlocal marketplaces, and why drivers are key

My top 2015 essays on Uber, online dating, push notifications, Apple Watch, and more

Personal update- I’m joining Uber! Here’s why

This is the Product Death Cycle. Why it happens, and how to break out of it

Quick update: Quoted in WSJ on dating apps, recent podcast interview, plus recent essays

New data shows losing 80% of mobile users is normal, and why the best apps do better

Photos of the women who programmed the ENIAC, wrote the code for Apollo 11, and designed the Mac

The Next Feature Fallacy: The fallacy that the next new feature will suddenly make people use your product

Why investors don’t fund dating

Why we should aim to build a forever company, not just a unicorn

Ten classic books that define tech

How I first met Eric Ries and also why I’ve ordered his new Kickstarter-exclusive book The Leader’s Guide

This is what free, ad-supported Uber rides might look like. Mockups, economics, and analysis.

Meet me and Eric Ries at a private event on March 21st – here’s how to attend

Personal update: I’ve moved to Oakland! Here’s why.

The most common mistake when forecasting growth for new products (and how to fix it)

The race for Apple Watch’s killer app

My top essays in 2014 about mobile, growth, and tech

Why messaging apps are so addictive (Guest Post)

IAC’s HowAboutWe co-founder: How to Avoid Delusional Thinking in Start-up Growth Strategy (Guest Post)

Mobile retention benchmarks for 2014 vs 2013 show a 50% drop in D1 retention (Guest post)

New data on push notifications show up to 40% CTRs, the best perform 4X better than the worst (Guest post)

Why Android desperately needs a billion dollar success story: The best new apps are all going iPhone-first

Early Traction: How to go from zero to 150,000 email subscribers (Guest Post)

New data shows up to 60% of users opt-out of push notifications (Guest Post)