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What is behavioral economics? Why does it matter to you?

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Podcast Episodes

What is behavioral economics? Why does it matter to you?

274. Reducing Business Friction: Understanding The Benefits With Examples From Amazon & Steve Jobs, with Roger Dooley (Refreshed Episode)

Today I welcome Roger Dooley to The Brainy Business podcast for a refresh of our conversation about his book Friction. Featuring this discussion was inspired by Richard Shotton’s new book The Illusion of Choice, which has one chapter about “making it easy” and then another on “making it difficult” (and you’ll hear all about it on Friday). This perfectly aligns with Roger’s book, Friction, which is all about understanding the psychology of friction and how it can be used to optimize customer experiences. That made it the perfect refresh candidate for this week!

While reducing friction is often best and what most businesses need, sometimes there is also value in adding friction in the right places. For example, in What Your Employees Need and Can’t Tell You, I suggest introducing a 30 minute waiting period before sending emails can help to avoid mistakes. 

As you listen today and think about Friction, consider your own experiences — where can they be easier? Where should they be more difficult? I know that seems a bit counterintuitive now, but some thoughtful friction is really valuable in the right places. Listen in to learn how you can use friction in your own business.

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IN A RUSH?

HERE'S A 2 MINUTE TIP.

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SHOW NOTES:

  • [00:39] Today’s episode is all about friction, specifically, a refresh of the conversation I had with Roger Dooley on his book Friction way back in November 2019.
  • [01:44] As you listen today and think about friction, consider your own experiences — where can they be easier? Where should they be more difficult?
  • [04:04] The cover of Roger’s book, Friction, intentionally had a coarse / gritty texture. It was meant to convey a sense of friction. (Priming!)
  • [05:35] Roger shares about himself, his background, and the work he does.  
  • [07:40] The interaction of neuroscience, behavioral science, and business has always been fascinating to him. His blogging, podcast, and books have given him a chance to explore that and simplify it for people in business. 
  • [09:22] There has been an increase in business interest in behavioral science.
  • [11:46] Change is hard, especially when humans are involved. 
  • [12:57] 95% of the time businesses have too much friction in their processes.
  • [13:49] There are times when adding friction helps. In general, it is best to eliminate it. Amazon is a prime example of that. 
  • [16:27] Friction is an unnecessary effort to complete a task. 
  • [18:29] Amazon makes it so that 99% of the time or more you are simply using the one-click button to ship a product to your home address or office address.  That makes it a low-risk transaction. 
  • [21:46] People don’t look at the cost of the processes they create. When looking at the total time, cost, and effort compared to the amount you would lose, there’s no comparison. 
  • [23:29] Where there is high trust there is low friction. 
  • [25:08] Often we create processes that are designed to make things easier but they don’t really work that way. 
  • [27:51] How many people are going to be affected by this and how can we make things easier? 
  • [30:08] In general, if you are trying to maximize leads or sales, making the process as simple as possible is the way to go. 
  • [33:08] By giving them that “out” you relieve the pressure and they are more comfortable complying with the request. 
  • [35:54] Buffer took all the friction out of scheduling social media. They made it simple to get started. 
  • [38:34] Rather than seemingly correct the person and imply that they didn’t work at it hard enough they avoid the word “actually”.
  • [40:46] Loyal customers are better and more valuable than new customers. Low-effort experiences drive loyalty. 
  • [42:38] They are comparing you against their best, lowest effort customer experiences. 
  • [43:57] You are endangering the loyalty of all those customers you can not handle in that instantaneous and efficient manner. 
  • [46:54] Sometimes eliminating useless parts of the process is the best way.
  • [48:34] As you look to decrease friction you will start to notice it all around you. 
  • [50:27] Melina’s closing thoughts
  • [52:41] Remember, you are a human doing business with humans inside your company and with your customers — trust and humanness and a reduction in friction can go a long way in building an amazing business.

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