How do you influence an audience to visit your site as a habitual part of their everyday experience? Then, once they are there, how do you motivate them to buy whatever it is that you are selling? Well, if you take a cue from woot.com, you could design your business model around the principles of Scarcity and Operant Conditioning.
For those of you not already familiar with woot.com (gasp!), the modus operandi on Woot! is actually pretty cut and dried. Only one item is sold per day, and it is announced at midnight each night. If it sells out by 2 a.m., it’s gone. If it doesn’t sell out immediately, it’s still going to be pulled from the site at 11:59 p.m. the next night. That’s it. This model has droves of people visiting the site everyday at 12:00 a.m. CT, when that day’s new product is announced.
Woot! makes brilliant use of the Scarcity and Operant Conditioning principles to keep their loyal following coming back. And yes, the pink unicorn is included with this laptop.
If you carefully read the paragraph above, you’ll find that both principles of Operant Conditioning and Scarcity are represented. But let’s take a closer look at how Woot! uses these principles to shape their audience’s behavior to first get them to check the site everyday, then motivate them to buy their products.
First, let’s take a look at Operant Conditioning.
The authors of Universal Principles of Design define Operant Conditioning as “a technique used to modify behavior by reinforcing desired behaviors, or ignoring or punishing undesired behaviors.” As for how Operant Conditioning applies to Woot!…well, if you act fast on Woot! (the behavior they want to reward), you will get a good price on a scarce product. If you don’t act fast (the behavior they want to ignore/punish), well, then you miss out.
Timeliness, therefore, becomes a key factor in the success of one’s Woot! experience. There are widgets and tools that we can integrate into our everyday lives to help us monitor the products that Woot! is selling…here are a few examples:
- Apple’s Dashboard widgets
- Example of a Microsoft Windows Sidebar
- @woot is one of the most followed accounts on Twitter
- RSS Subscriptions to woot.com are currently over 32,000 readers and with an average of 49.9 posts per week.
- iPhone apps including: Woot Watch, WootOn! Woot at a Glance, ClockWoot
The fact that these tools exist at all is proof that we are looking for ways to create a daily habit out of checking Woot! for deals. They introduce behavioral change into our daily lives; something we don’t usually choose unless the reward is great (or on the other hand, if the punishment is severe.) The reasoning is as follows: if we check Woot! frequently enough, over time, there will be enough deals that reinforce our pattern to keep checking back for more deals. The promise of this “variable ratio reward schedule,” keeps us coming back to check for the next reward, and is an example of Operant Conditioning at its finest.
Once we get to the site, the Scarcity principle comes into play…
“When items and opportunities become scarce, so too does their general desirability, and even people who are otherwise disinterested often find themselves motivated to act.” 1 Woot’s mocking (yet funny) approach to customer service makes it clear that there are no exceptions around the scarcity of their products. From their FAQ:
Question: I missed yesterday’s item. Can I still get one?
Answer: No. Each Woot! product is discontinued at 11:59pm central time. That’s that. Period. We may get more at a later date if we’re lucky, but we offer no guarantees, we allow no backorders, and we have no waiting/notification lists. Too bad.
Not your typical Customer Service FAQ, is it? But because loss aversion is a powerful motivator, Woot! is able to be irreverent because it is also brilliantly employing a set of scarcity-related tactics to create demand. These become key influencers in helping people make the decision to buy, and buy now:
- Exclusive information: It’s the bizarre variety of the products that keeps people coming back. One day might be a Blu-Ray Player with Netflix Streaming on the cheap, the next day might be a 10 x 10 Gazebo (see other random examples here). There is something for everyone, but not all the time.
- Limited Time: They guarantee that the supply will only last so long…whether the product sells out immediately, or by the next day at midnight.
- Limited Access: We can only buy a limited quantity of any one Woot! product.
- Limited Number: No one knows how many items Woot! has in stock of that day’s product. Once they are gone, that’s it.
- Suddenness: Supply can be depleted by 2 a.m. if the product is awesome or the price point really great. Or, if you hedge your bets and wait for morning, another sudden run on the product can happen at 8 a.m. when we all check our first emails of the day.
How can I discuss Woot’s application of the Scarcity principle without mentioning the coveted Bag of Crap?
The crown jewel of the Woot! Off experience is the bag of crap. Literally known as “Random Crap” but known as “Bag of Crap” by fans because of the paper bag image used, it’s a grab bag of fun. Each bag has one item in it, randomly selected by Woot! A bag of crap could hold something as trivial as a refurbished CD player or as awesome as an Xbox 360. The Bag of Crap is so popular that when one comes up in the Woot! Off rotation, it usually brings the Woot! servers to their knees. People love the gambling-thrill of the Bag of Crap. -Lifehacker2
Woot's infamous Bag of Crap (BOC)
The fact that the BOC can bring the Woot! servers “to their knees” is a supreme example of the principle of Scarcity as a motivator. Woot! has conditioned its audience to clamor for an unknown item based almost solely on its scarcity and caché, which is remarkable. (Certainly, since the BOC is only $1, the risk is minimized while the perceived reward—even if it is a complete joke—skyrockets.)
Together, Woot’s use of both Operant Conditioning and the Scarcity principles help keep the site going strong. The UX of the site has actually changed very little since it’s launch in 2004, and Woot’s business model—the first of it’s kind in 2004—is now popularly known as one-deal-a-day, and is used ubiquitously across the internet.
(Design principles are well at work in the world around us. “Scarcity” and “Operant Conditioning are the 10th and 11th out of 125 universal principles of design that I will cover this year.)
References
1. Universal Principles of Design by William Lidwell, Kritina Holden, Jill Butler, Rockport Publishers, 2010, p. 174-175, 216-217.
2. The Complete Guide to Capturing Woot! Off Loot, Lifehacker, March 24, 2010.
Also see:
Influence: The Psychology of Persuasion by Robert Cialdini, Collins Business, 2006.
The Behavior of Organisms: An Experimental Analysis by B. F. Skinner, Appleton Century, 1938.
Here is a podcast with Leo Laporte opening his BOC.
And finally, thanks to Andy Budd for slide 65 of his presentation, Persuasive Design: Encouraging Your Users To Do What You Want Them To! given on day two of the IA Summit in Phoenix. It is what inspired me to write this post.
