© Edward Stull 2018
Edward StullUX Fundamentals for Non-UX Professionalshttps://doi.org/10.1007/978-1-4842-3811-0_27

27. Price

Edward Stull1 
(1)
Upper Arlington, Ohio, USA
 

In Leo Tolstoy’s short story, Ivan the Fool , three brothers seek success in three different ways: Simon wages war , Tarás pursues riches, and Ivan works the land. But like all experiences, each endeavor extracts a price.

Simon and Tarás wish to leave their family’s estate to pursue conquest and fortune. They bully Ivan, demanding money and food from him to support their adventures. Ivan is simple, having little to do with his brothers’ interests, but he tells them to take what they want.

Shortly after Simon and Tarás leave home, the Devil begins to create strife among the three brothers. He pits one brother against the other, plaguing the men with losses and misfortunes. Simon trades his honor for prestige. His hubris leads him to military defeat . Tarás trades his integrity for gold. His misdeeds lead him to financial ruin. However, the Devil is unable to make Ivan fail.

The Devil twists Ivan’s plow and floods his fields, but Ivan persists, facing each challenge with kindness and humility. Ivan’s good nature and simplistic views protect him from the Devil, ultimately leading Ivan to rule his own kingdom. The kingdom forsakes gold and glory, but in return, Ivan and his subjects live in harmony. Not a bad conclusion for a Russian fairytale.

Tolstoy’s allegory demonstrates that the price of something is more than what we literally pay. It is an exchange of values: give and take. Time, energy, attention, and money are just a few of the many currencies we can use. What we are willing to exchange defines an experience, be it a single interaction or a lifetime. Each exchange comes at a cost: we save time by sacrificing quality; we gain convenience by decreasing privacy; we build communities by surrendering authority. Nothing is free.

Although Tolstoy wrote Ivan the Fool in 1885, we can still see modern day organizations fulfilling each of the three brotherly roles. Some companies act like military generals, believing they can simply command people to use their products, discarding their users’ goals in favor of their own business’ objectives. Such companies fail quickly. Other companies play the part of rapacious swindlers, focusing solely on short-term financial gains, squandering their user’s time and trust with unethical tricks and dark patterns. Such companies fail eventually. Yet, we realize the greatest success by being the virtuous fool , taking no experience for granted, working on behalf of our users, and serving our audiences with kindness and humility.

Kindness and humility begin our discussion on price. For price, at its core, is the measure of any relationship, comprising both give and take, both gains and losses, both benefits and costs. Price defines a relationship, and experience becomes our ledger.

Economy of Needs

At the turn of the 20th century, an Italian economist named Vilfredo Pareto created a power law that we still use today. A power law bases itself on two quantities: one fixed, one proportional. You experience a power law each morning if you are a coffee drinker. Some mornings you may drink from a small cup and use one teaspoon of sugar. Other mornings you drink from a large mug and add several teaspoons . The more coffee you pour, the more sugar is needed. The quantity of one dictates the quantity of another. Pareto’s power law involved the relationship between population and land ownership. He recognized that 20% of Italy’s population owned 80% of Italy’s land. These observations later extended into other studies, such as the relationship between income and taxes. In each case, Pareto saw that approximately 20% of causes generated 80% of the effects (see Figure 27-1).
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Figure 27-1.

The 80/20 rule , where approximately 20% of causes generate 80% of effects

In 1941, Joseph Juran1 formed his theory of “the vital few and the trivial many,” based on Pareto’s distributions. Commonly known today as the Pareto principle, or the 80/20 rule, we see these distributions in everything from the relationship between top salespeople and company revenue , to the relationship between earthquake damage and seismic activity. We see examples of the Pareto principle everywhere. Twenty percent of products generate 80% of a company’s revenue. We wear 20% of our wardrobe 80% of the time. You’ll likely find 20% of this book delivers 80% of its value.

Pareto distributions are not always 80/20. However, they always feature an unequal weighting where a short peak of high values and a long slope of low values are present. Imagine a mountain cut in half . The mountain may be tall and thin, or short and wide. Every mountain has a peak, and every mountain has a slope. Now, consider a digital project. The short peak of high values reflects your vital efforts; the long slope reflects all the extraneous—and sometimes trivial—activities. We can almost feel Pareto distributions at play in our project schedules: we spend long portions of time caught up in minutiae (80%), and we cram the most important work into the short time before a deadline (20%). Consequently, that 20% period of time leads to 80% of our most important work . We can change this, however. Pareto isn’t predestination.

Pareto is also known—at least by economists—for a concept called Pareto efficiency. Pareto efficiency involves resource allocation. Picture two classrooms full of children. Each classroom contains rows of desks and smiling kids waiting in eager anticipation. You hold a basket full of cookies. You walk into the first classroom and hand a kid a cookie. Exiting the room, you walk down the hallway and into the second classroom . There, too, you hand a kid a cookie and exit the room. Simple process: walk into a classroom, hand a kid a cookie, and walk out. You repeat the process until your basket is empty.

With 10 cookies, the math is simple: you repeated the process five times. The fifth time is said to be Pareto efficient—you gave away all your cookies with an equal allocation. But what if you started with 11 cookies? On the sixth repeat of the process, one classroom gets a cookie, and the second classroom gets nothing. It isn’t Pareto efficient. One classroom is better off than the other. How can we improve this situation for the second classroom? Perhaps we could voluntarily compensate the second classroom somehow, such as by given the kids extra recess time . If we did, this compensation would be called a Pareto improvement. With the second classroom now better off and the first classroom being no worse off, we’ve reached a Pareto efficiency.

Although Pareto efficiencies drive free markets, they also create an argument for fairness: we wish all parties in an exchange to be made whole—no party should be made better off at the expense of the other.

Pareto UX

In terms of user experience , you could say that Pareto efficiency involves the fulfillment of needs—for users as well as businesses . We wish for both users and businesses to be made whole. Neither is better off at the expense of the other. Needs between users and businesses occasionally conflict. What a user wants, a business may not, and vice versa. Imagine an app that performs one of two functions: a user presses a button and gives $1 to himself, or a user presses a button and gives $1 to the business . Obviously, a user would prefer the one outcome and a business the other. The app is not Pareto efficient . When one party is better off, the other is worse off. We need to find an improvement to achieve the efficiency.

Like the “Acme $1 app,” every application provides a value exchange between a user and a business. Sometimes this exchange is front-loaded, and users pay for the application before its use. But often this exchange is less direct. A business may offer utility in exchange for a user’s loyalty. It may offer entertainment in exchange for attention. It may offer content in exchange for information. In each case, the Pareto efficiency illuminates the exchange : does the exchange benefit one party over the other? Is it optimal? Is it fair?

Complex applications may contain dozens—if not hundreds—of value exchanges between a user and a business. A visitor to an e-commerce site is offered utility in exchange for attention, information, and loyalty. The exchange is worthwhile for the business, if the cost of providing the utility is matched by the value it receives from users . However, these exchanges are easily mishandled when a business asks for too much from its users. Many users are a form field away from abandonment. Attention, too, is frequently overtaxed by obnoxious marketing. Moreover, the exchange of personal information threatens to surpass any value offered by a business.

If an application benefits the business or user at the expense of the other, we must revisit Pareto’s concept of efficiency and find improvements . How do we know if there is an unbalance? We create a list.

1. Sale of products

(+Business, +Users)

2. Customer information

(+Business, -Users)

3. Brand exposure

(+Business, +Users)

4. Ad impressions

(+Business, -Users)

5. Discounts

(-Business, +Users)

6. Free shipping

(-Business, +Users)

[…]

 

Using this example, we can see that the sale of products benefits both the business and user. A business gets paid; the user gets the product. This exchange is efficient. However, when we evaluate the exchange of customer information , the business benefits and the user does not. The user gave up a bit of their privacy—but in exchange for what? How do we find an improvement to make this exchange efficient?

Unequal Exchanges

In cases where an unequal exchange is made, we need to find a means of compensation. When a user gives up a bit of privacy, we can compensate her. Perhaps her private information is necessary to complete an order. The business profits from this information . But we could use it to expedite forms for the user, such as auto-filling a shipping address. Such functionality now provides benefits to both the business and user. The key is to compensate for every unequal exchange.

You can scoot by with one or two unequal exchanges, but push it too far and people will abandon. A good example is advertising placements. Ad impressions clearly benefit a business through increased awareness and possible ad network payments, but even the most jaded marketer must admit that advertising rarely benefits a user. Where can Pareto improvements be made in this equation? The short answer is that sometimes they cannot. To offset the cost of some experiences, we must overcompensate in other areas. Google Search does a fine job of this. Advertising surrounds it users, but the resulting utility is so great that the exchange is welcomed by those who carry out the 3.5 billion searches per day.2

At first, Pareto efficiencies may seem unnecessarily analytical, but they can help you reveal future user experience issues before they occur . Strive for balanced exchanges, for an imbalanced one will always remedy itself eventually: you’ll either fail by offering too much, or fail by offering too little. Balance maintains fairness. In the economy of needs, fairness always wins.

Contrasts and Anchors

I have a question for you: is the oldest performing ballerina more than 25 years old? If so, by how much? Without cheating , please take a guess now. I will wait.

Waiting…

What did you guess? Maybe you added 10 years; a ballerina at 35 seems reasonable. Maybe you added 20 years; a ballerina at 45 seems possible. Would you have added 61 years? Likely not. However, the oldest performing ballerina is 86-year-old Grete Brunvoll from Norway.3

Although regularly performing ballet at age 86 is remarkable, your answer skewed lower because of the anchoring effect the question: “Is the oldest performing ballerina more than 25 years old ?” Even though 25 years old perhaps seemed too young to retire , the number still anchored your expectations.

Anchoring affects everything from national budget policies to the price of tap shoes. It is a well-known tactic in the restaurant industry. Ever wonder why a $99 bottle of champagne is featured next to $5 chicken wings on a sports bar’s menu? The high anchor price of the champagne makes everything look less expensive. The inverse is true, as well: feature a low-cost item, and even the most reasonably priced items will appear expensive.

The human brain acts as a biological cash register, recording the highs and lows—the costs and benefits—of commercial experiences . Psychologists and professors , such as Robert Cialdini, Paco Underhill, and G. Richard Shell, have dedicated their careers to understanding influence and shopping behavior.

Behavioral economists and psychologists, such as Daniel Kahneman, Amos Tversky, and Richard Thaler, use pricing to delineate the very fabric of human behavior and decision making , proving price is more than a monetary measurement. We measure prices in dollars, but also time, attention, pleasure, and risk. As such, contrasts and anchors affect how we perceive costs.

Decoy Effects

Decoy effects steer people to choose one of two options by presenting a less preferable third option . The third option creates a decoy. Such decoys offset all sorts of questions, from software subscriptions (e.g., $1, $10, $30—decoy) to video game weapons (e.g., epic, uncommon, poor-quality—decoy).

Contrast and anchoring may trick users into making unwise decisions, but we can use the same techniques to create a greater good.

Ethical Anchoring

Attaching anchors to data creates a bias. But biases are not inherently bad. We can use ethical anchoring to persuade users to perform beneficial tasks.

Rather than display a progress bar at 0% completion , we can begin it 20% completed. We give users a head start . The partial completion creates an anchor that persuades users to keep going. After all, the first step in a journey is often the hardest one. Skip this step, and your users will be well on their way to a goal.

Want users to share your content ? Provide them a pre-filled message (see Figure 27-2). Not only does pre-filling save users time, but it also gives users an example of the type of message that could be shared. Users add a personal flourish, edit , or delete. Whatever the decision , a pre-filled message sets an expectation of how something works.
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Figure 27-2.

Pre-populated tweet content created through publish.twitter.com4

Setting an expectation helps users visualize the future, be it a download, a tweet, or a dance recital . Contrasts and anchors inform decisions by supplying information where none exists. When we anchor information , we reduce a user’s need to figure things out for themselves, quickening the journey to reach their goals, turning pirouettes into promenades.

Highly Destructive Operations

Years before the actor Sir Alec Guinness donned a cloak and wielded a light saber, he stood on the embankment of Sri Lanka’s Kelani River and shouted instructions to his fellow British prisoners of war . A largely fictionalized retelling of the construction of the Burma–Siam railway, The Bridge on the River Kwai5 recounted the hardships , struggles, and ultimate triumphs of Allied POWs and conscripts under the brutal occupying forces of Imperial Japan during WWII. Sir Alec was its star. The film shines as an example of both the foibles of pride and the exultations of sacrifice, for it tells the story of how the Allied prisoners painstakingly crafted an Axis rail bridge, only to destroy the same bridge once it was completed. It is a vital lesson shared by all creative endeavors: everything built is eventually destroyed—sometimes by others, other times by ourselves.

Users build and destroy. They spend hours finding the perfect product, only to abandon it in a shopping cart. They spend minutes filling out a lengthy form, only to cancel it midway . They spend seconds viewing an app’s login, only to ignore it and never return again. Users destroy, burn, and disassemble their own experiences repeatedly. They throw away their time, energy, and attention. They build and discard. They voluntarily dynamite the bridge leading to their own goals.

In the movie, Sir Alec’s character , Colonel Nicholson, experiences a moment of revelation when he realizes all his efforts have been wasted in the pursuit of an unworthy goal. In his last breath before dying, he exclaims, “What have I done?” falling onto an explosive plunger, detonating the bridge he had just completed. Though he had labored for months, he abandoned his goal within seconds of his epiphany.

Sudden abandonment is an ever-present liability within an application. It is the bomb hidden within every user experience . We construct experiences, bridging user needs with user goals . Yet, users alone decide whether to continue their journeys or to abandon them—they either traverse the bridge or blow it up.

Consider the fate of Myspace. At its height in 2006, the social site attracted more daily users than Google.6 Over 75 million people visited the site each month, roughly equivalent to two years of traffic on the Golden Gate Bridge. Since then, the number of Myspace accounts has dwindled. Think of the millions of users sitting in front of their computer screens , reflecting on all the time they had spent on Myspace, and in a moment of revelation exclaiming “What have I done?” then tapping the “Delete Account” button. Purchased for $580 million in 2005, News Corp sold Myspace for $35 million in 2013.7 Kaboom .

While the shift from one social network to another is certainly not new, it does highlight highly destructive operations. Even when users spend considerable time and energy investing in an experience , they will still abandon it. As the saying goes, “It’s a matter of when, not if.” Facebook gained when Myspace lost. Myspace gained when Friendster lost. Friendster gained users from now defunct networks such as PlanetAll, Bolt, and SixDegrees. Everyone eventually abandons.

E-commerce fares no better. Companies have agonized over shopping cart abandonments since the birth of online shopping. Several studies estimate abandonment affects two-thirds of all online transactions . According to 2014 U.S. Census data, e-commerce totaled 394 billion dollars in retail sales;8 yet these dollars only account for one third of all carts.9 Without abandons, U.S. online sales would top 1.18 trillion—slightly more than the total GDP of Mexico.

Everyone abandons, but how do we preserve relationships with users in the interim? How does each interaction with a user contribute to or take away from the overall experience ?

In the parlance of marketing, we define the preservation of a relationship as loyalty. A huge category in its own right , loyalty also plays a vital role within service and user experience design.

Avoid Mistrust

Security and privacy breaches affect relationships with users. When hackers stole data for an estimated 40 million card accounts and 70 million records of guest information from Target10 during the holiday season of 2013, the company reeled from plummeting customer satisfaction scores, stock price drops, a downgrading of its credit rating, and the eventual replacement of its CEO. However, the full impact of this breach may continue to reverberate for years. How willing are you to use Target’s website: enough to apply for a store card? Enough to create a bridal registry? Enough to buy?

The 2016 American presidential election flooded airwaves with a slurry of gossip, misinformation, and conspiracy theories. From PizzaGate to hacked emails, voters were inundated. As voters were often also Facebook users, inundation came in the form of eye-raising posts and hair-pulling comments threads. Our trust eroded. What we relied on as a daily diversion nearly capsized a democracy. Likes became contentious endorsements, worthy of heated debates and creative name-calling. Goofy personality quizzes,11 weaponized by campaigns, became sophisticated social engineering tools capable of piquing interests and exacerbating divisions. Whistleblowers would come to reveal the extent of this manipulation . Facebook’s audit indicated 87 million affected accounts.12 Despite the company’s eventual highly publicized apologies and congressional testimony, its problem with mistrust began more than a decade earlier.

In late 2007, Facebook launched the advertising platform Beacon . Beacon worked with partner companies, such as Blockbuster and Overstock.​com, to extract knowledge of website visitors’ activities—including buying and renting products and signing up for accounts. This detailed information was subsequently broadcasted in the newsfeeds of other Facebook users. Surprise gift purchases and movie rentals began to show up in the newsfeeds of wide-eyed spouses and voyeuristic friends across the social network. Years later, Facebook would terminate the service as part of a legal settlement, along with a 9.5-million-dollar judgment13—a drop in the bucket for a company with a market cap approaching 405 billion dollars in 2016. Yet, we must ask ourselves how such negative experiences change a brand. Some users love Facebook , some hate it, and many mistrust it. You can almost hear the faint sound of the Kwai River flowing beneath many Facebook user experiences.

Mistrust manifests in subtler ways as well. Where persuasion illuminates a path, manipulation dims it. Manipulation diverts users into making inadvisable decisions. We see its hand in ads placed near buttons, as unscrupulous designers attempt to capture a users’ mis-clicks. We see manipulation in link-bait titles, such as “The most important issue you must deal with today!”, “10 things no one will tell you”, and “You won’t believe this actually exists!” Hyperbole may provide a momentary spike in traffic, but it will ultimately erode your user’s trust. Fool me once, shame on you; fool me twice, shame on me; fool me three times, I’ll never click one of your damn links again.

Receive and Respond

Before online surveys, before market analysis, before focus groups, before telephone polling, before interviews, and before any research at all, was conversation. Conversation forms the heart of all relationships between human beings. From a loud “I love you” to a silent shuffle in your chair, we exchange information with one another by conversing.

We sometimes find ourselves so engaged in a conversation that time slips by like a fast-flowing stream of consciousness. Conversely, some conversations drip slowly, like a leaky faucet. Mihaly Csikszentmihalyi described in his book, Flow: The Psychology of Optimal Experience , that a person’s perception of time is altered by her or his focused attention. When we immerse ourselves in a pursuit, we maintain a state of flow.

Software enhances flow when users receive immediate feedback throughout an experience. Applications receive all sorts of inputs: mouse clicks, gestures, form field blurs, interval timers, and the like. However, these same applications often fail to respond with any sort of tangible feedback to their users. Akin to a user and an application passing each other in the hallway, the user says, “Hello, application!” and the application walks by without giving the user the slightest acknowledgment, making an application’s personality appear cold and mechanical.

Dan Saffer’s book, Microinteractions: Designing with Details , refers to software feedback as a “personality-delivery mechanism .” It affords us the ability to interject experiences with a human presence, including a full range of dispositions like humor, warmth, and charisma. Applications receive digital inputs, but they respond to human beings. It would serve us well to remember this. After all, users abandon for two reasons: when they dislike what they experience, and when they experience nothing at all.

A destructive experience extracts a cost from both users and creators. We pay the price, spending time, energy, and attention. Occasionally, we must clear the way for new experiences by destroying the old; yet, we must still maintain our connections with users. Trust and communication keeps the bridges intact.

Key Takeaways

  • Good UX takes no experience for granted, serving its audiences with kindness and humility.

  • Complex applications may contain hundreds of value exchanges between a user and a business.

  • To offset the cost of some experiences, we must overcompensate in other areas .

  • Imbalanced exchanges cause products to fail by offering users too much or too little.

  • Anchoring affects users’ perceptions of prices.

  • Ethical anchoring persuades users to perform beneficial tasks.

  • Users abandon experiences, even when users invest considerable time and money in an experience .

  • Users abandon for two reasons: when they dislike what they experience, and when they experience nothing at all.

Questions to Ask Yourself

  • Which 20% of an experience provides the most value to users?

  • Where within an experience do users spend 80% of their time?

  • Is an experience Pareto efficient?

  • How can I employ ethical anchoring techniques to help users pursue their goals?

  • Where within an experience is a user likely to abandon?

  • How does each interaction with a user affect her or his overall experience?

  • Does an experience persuade users or manipulate them?

  • Could users interpret any part of the experience as deceitful or unsafe?

  • How can I help users maintain a state of flow?

  • Ultimately, is the experience worth its price?

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