The power of behavioural economics is that identifies irrational cognitive processes to produce counter-intuitive insights which help us to better predict human behaviour. Consider the chart embedded above which shows the pain intensity over time experienced by experimental subjects. Patients in the B category clearly experienced more pain, but the surprising, counter-intuitive, result is that Patients in the A category remembered themselves as having had a worse experience.
In this case it is human memory which performs irrationally. Rather than accurately remembering and each element of an experience we are driven by what behavioural economists call the Peak-End rule which says that our memories are unduly influenced by the best and worst elements of an experience and by its final moments. In the ‘pain experiment’ which was conducted by Daniel Kahneman patients in Category A finished with much greater pain than those in category B and it is this worse ‘end moment’ which explains why they recall the pain as being worse than patients in category B (more details of the experiment here).
When I read about theories like this I like to test them on my own memories, and when I think back over the best and worst experiences of my life it is the peaks and troughs that I remember. For example – when I think about the best gigs that I’ve been to, I come up with a list where the best moments were AMAZING, not where the end to end experience was great. I can also see the importance of final moments, bands for example, routinely save their best tracks for the encore.
Turning to consumer internet, the peak-end rule tells us that to get consumers to have a great memory of an app it should deliver a real wow and maximise the peak, and that the impression in the moment when the consumer leaves the service is also important. Think about the Twitter ‘Fail whale’ and the amount of goodwill they got by having a bit humour having just delivered a service outage.
Interestingly, the amount of time spent using a service doesn’t impact how we recall it which implies that after a point engagement metrics are a poor guide to customer satisfaction (although they may be important for revenue). Google intuitively grasped this point in their early days when their goal was to get you off of Google and onto the page you wanted as quickly as possible.