The relationship between frequency of habit and customer retention

Edited excerpt from Grabbing Attention and Holding Onto It by Ben Yoskowitz:

In the consumer world (although this applies to B2B software too), attention is the currency that matters. If you can get people’s attention you have a chance of winning. Without it, you can pack up and go home.

When talking to entrepreneurs I often ask, “Do you envision this as a daily, weekly, or monthly use case?” If it’s a monthly use case it’s hard for me to get excited because the gaps between when you’ve (hopefully!) captured people’s attention are too big–it’s harder to get people coming back and the cycle times for testing things are too long. You won’t learn and iterate fast enough. A weekly use case is better, but daily is the best. Find a daily use case for something–and prove it–and you’ve got something very interesting.

If you’re building a product that doesn’t have a daily or weekly use case be very, very afraid. Certainly there are products that don’t get used a lot and are very successful (tax software anyone?) but it’s not a direction I’d recommend. And if you’re building a product that you think has a daily or weekly use case you need to prove that quickly.

Notes:
(1) Service providers for infrequent habits often become dependent for distribution on service providers for frequent habits. Example: Online retailers for occasional purchases (= infrequent habit) are dependent on Google search (= frequent habit). The only solution is to form a strong enough bond with your customers to generate loyalty.
(2) Sometimes a market has low frequency of habit. But a disruptive startup can lower price and friction enough to raise demand to a frequent habit. Think cars vs horse-drawn carriages.
(3) Our experience in Seeking Alpha: Monitoring your portfolio is a daily (weekday) habit. By providing better content on users’ portfolios, we’ve been able to win tremendous “attention”.

4 thoughts on “The relationship between frequency of habit and customer retention

  1. Pingback: The best products satisfy a frequent user need with minimum friction | A Founder's Notebook

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  3. Pingback: Why startups shouldn’t develop iPad apps | A Founder's Notebook

  4. Pingback: A framework for growth hacking using Job To Be Done | A Founder's Notebook

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