Psychology for PMs - "Peak-end theory"
Did you know how crucial a role psychology plays in shaping up a PM's success? Here's how you could employ extreme points defining emotions of your users to build great product experiences.
“As product managers we often find ourselves needing to outguess, outthink, outsmart the markets and the user groups and in getting any closer to achieving that, the whole effect of psychology has as a subject could never be discounted”!
Building context
A really long time back when I was in a training (owing to how we cherry-picked topics / subjects over our training calendars given the degree of autonomy the MNCs offered) the trainer was talking on the subject of "impact" explaining the importance of "making / leaving an impact".
He narrated how he remembers each of us in the hall by our names (there were about 25 of us) and it was the 2nd day and how he may still be able to do that for the whole week post the 3-day training engagement he was signed up for with our org., but how his memory may be reduced to the people who consistently outshined or managed to exhibit their lustrous best on the very last day or the parting moment over the forthcoming weeks and thereafter.
No surprises there, isn’t it?
That is just how we humans happen to be wired, we are programmed to remember experiences based on the impact they have had on us over our interfaces be it single or multiple and especially the ones that tend to leave a strong tinge. Also, please note, how that impact in question could either be positive or negative and it would all add up and get accounted for.
There is no doubt that the same thing could apply to UX at a very broad level and customer experience (CX) at a granular level.
The customer experience is so often shaped by the most intense points and of course the finish
- Steenstra, 2021
Alas! Only if one had some magical powers to deduce what those moments were and how they happened to shape up or influence user behavior.
The Peak-end Rule
Devised by the Nobel prize winner Dr. Daniel Kahneman the peak-end theory talks about how “people’s judgement of things largely stems from the peaks they seem to have experienced over a period of time” as opposed to being more considerate and gratifying by taking some sort of a mathematical average of those very experiences.
Let’s run over a few practical scenarios to get a hang of this.
SCENARIO 1:
A generic example away from the domain of Product Management:
(Most people may correlate to this & I know how its really sad at so many levels)
A lady who was working for an org. for almost 4 years decided to quit and resigned. The post-resignation discussion happened and it seemed like she was unmoved by any amount of convincing by the org. to reconsider her decision or cajole her to overturn it to stay back. On the day of her reliving all the documents were not handed over by the concerned department and she was asked to come back at a later date (which may be fair enough).
But, what followed post that was tons of delays that mounted to weeks and trepidations on the back of some mumbo-jumbo reasoning by the org. that led to deep sourness in the whole relationship during the END of her tenure.
Years later, when the name of the org. is quoted irrespective of the place or the context, her sourness is bound to take over anything else, even the countless instances she might have enjoyed spending there leading to many crucial learnings helping shape her whole career.
1) problem:
Over most orgs. the head honchos, the C-suite may not even get to notice all this as it might have been handled about 4-5 levels lower to theirs. All that they would see is a “negative review” or a “negative rating” over public domain leaving them with many questions.
2) desirability:
Could all those problems be averted? Well, yes. Only if the culture was so deep-rooted and was upheld or practiced across teams getting each and every member to live, breathe & eat it so to speak.
3) feasibility:
That’s so easy to say or even set the bar high over culture and still so tough to achieve, even after years of practice.
4) insight (peak, end):
Over interfacing with the employees at the exit interview, one could consider popping a few questions applying the peak-end rule so as to enlist a thing or two about behaviors. For instance:
what’s the one thing you liked about working for the org. here?
if there’s anything that you’d change over the way we functioned, what would that be and why?
how would you rate the overall experience you have had over this exit interview?
if there’s anything that you’d change over the exit interview, what would that be?
Although some may argue that the main motivation things get to that stage pushing employees to quit and bring the EXIT interview about, it should NEVER be driven by the culture of teams and that’s an absolutely fine way to think.
NOTE: Most important part about the questions and the answers ought to be transparency and visibility. They ought to have an org-wide visibility and taking feedback like it ought to be taken.
5) deterrent:
It’s quite possible that the responses over the questions may not be accurate or ceases to be an exact reflection of the trepidations defining experience one’s had.
6) workaround:
How about this for a change over the workflow?
honor the response and send in an acknowledgement to the employee
send a MoM (minutes of meeting) of the Exit interview over e-mail
drop an e-mail exploring the person’s availability over a short call (if needed)
ask relevant follow-up questions that help drilldown deeper into issues faced
ensure confidentiality and thank the person for their time
put forth the feedback thus received for internal reviews & discussions
The shared understanding:
There are many instances where the Peak-end rule could apply and prove to be gold class.
Post teaching my mentees about Kahneman and his works, I’m not altogether surprised how one of them recently went:
“I now thoroughly understand and comply with the concept of leverage and focusing on the right area or incentivizing the right stuff so as to aid the movement healthily over the metrics”
And I’m not surprised altogether. There are countless instances where leadership coaxes teams and unforgivingly pins on and follows up over some vanity metrics when there seems to be no real intention or inclination towards sitting down with the teams and spending time with them, collaborating with XFN and getting one’s hands dirty with strategizing.
Here’s a visual framework you could employ to collaborate and brainstorm towards arriving at building a shared understanding of the entire situation.
start with the 1) problem and working your way towards gaining some 2) insight over the peak and end points
that done, you explore the 3) desirability of the markets / users and the 4) feasibility of coming up with a workable solution to it
then go about listing out the 5) deterrent(s) that reduce the solution from being effectively applied and adapted to
and finally get to exploring 6) workaround(s) so as to put it all in the clear as for the implementation of the solution goes thus paving the way for a smoother execution
SCENARIO 2:
Adapting to the Peak-end rule driving conversions at an FMCG firm for a common product - “The Toothpaste”
(This would totally be familiar turf if you are a PM at a growth stage startup)
A new PM joins a growth stage startup and is handed his first outcome to drive, which is to bump up the conversion rate so as to lead to improvement in sales by specifically focusing on the marketing bit.
The PM starts off by interfacing with all the concerned and relevant stakeholders gathering data from all the market touchpoints and deriving insight into where they stand currently whilst gauging the strength, relevance and semblance of all marketing activities undertaken thus far and the magnitude by which the needle seems to have moved over each of the metrics that they were tracking.
Turns out the results were skewed towards problems and that seemed to go beyond just what appeared on the surface of it, as in - packaging, presentation, availability & accessibility when there was no denying that there may have been problems there as well. It indeed seemed deep-rooted.
Time to go over our framework again now:
1) problem:
Toothpaste is such a mass market and yet well segmented at the same time. When the PM pinned on the product analytics it was evident that the no. of eyeballs on the product as for in-store shelves wasn’t all that impressive at all (insight gained by pinning on & studying survey data)
2) desirability:
Firstly, see if the visibility part could be solved so that the no. of eyeballs on the product would increase (multiply) manifold & then look at taking it to the next step over enticing the customer to add that tube of toothpaste to his cart
3) feasibility:
Can we look at organizing a separate shelf for our toothpaste so as to standout from the other competitors in the shelves? Or is there any other way to achieve this outcome and solve the problem of product visibility?
4) insight (peak, end):
Not discounting the fact that the situation may demand some user testing at first so as to get a hang of the user behavior and meticulously measure for changes over their attitude & how that affects their perception towards the product in particular and the brand in general.
Here are a few steps:
organize a few random focus groups to understand user behavior & why they skipped the product & moved away from the shelf
understand their current adoption patterns & the motivations behind them
hinge on & employ technology to effectively change the positioning of the product (depending on what the problem happens to be)
for instance: if the problem points to “users perceive the toothpaste as just another product in the market” it simply means they don’t understand the value or THE thing that differentiates, so ensure you put in an effort to highlight that over the pitches
introduce new terms which are essentially deeply tech / science / subject oriented and explain them over the pitch like as if one was talking to a 5-year-old (#ELI5)
build a few alternative pitches and A/B test them over keenly measuring the TTV (Time To Value) or cycle time and how the user’s / target market’s perception of the value proposition changes now
NOTE: Another very famous quote from Kahneman which talks of falsehoods and frequent repetition combined with the Peak-end rule could do the trick here.
5) deterrent:
It may still be possible that the conversions don’t take off as much as expected which is where the whole point of frequent repetition could kick in
6) workaround:
Just supposing the adoption and retention rates don’t takeoff as expected, the workaround could be applied over these steps:
ensure your target market understands how you define the value proposition alongside the differentiation strategy
hinge on technology all the more and show how it is deeply embedded into the making of the product as well
talk percentages when you want to highlight metrics oriented towards product efficiency
introduce new tech terms that the market has never heard thus far and use those theories to inform the target market about how your org. has factored it all in over building the product
project the fact that the org. deeply cares for issues that plague the environment today tying it to how that led to the motivation to innovate
ask your marketing / copywriting teams to iteratively work on refining the content so as to make it more amenable to your target audience / markets
Peak-end rule - Canvas usage
Here’s a visual representation of the peak-end rule over “scenario 2” so as to facilitate brainstorming & seamless collaboration of XFN building clarity & leading to a shared understanding:
(click here for the HQ version)
Remember:
The peak-end rule defines how the user’s emotions over the usage of a particular product or the BEST experience they have had (PEAK) over their entire tenure and also around that time when they made that decision to drop the product / quit (END) does play a crucial role in defining the behavior.
Make sure you are factoring that in to target and build some great experiences over your products / features.