Dead Ends: Lock Ins

Hi. Welcome to Dead Ends. A monthly podcast about how the world around us is designed. How it got that way. Ending mostly in. Isn't that interesting? I'm one half of your hosts, Sarah Drummond, and I'm the other half lay down. And this is a dead ends podcast and we hope you enjoy the show.

00:00:27:18 - 00:00:48:12

Sarah

Okay, so I have my notes here. The first thing to say for our new podcast, how is it February already? Actually, March. So we are like two years, two years, two months. I mean, we could be two years, two days to do this podcast. Yeah. Do we still say Happy New Year? No, definitely not. And I love that that's in your notes.

00:00:48:13 - 00:01:05:20

Sarah

How do we say Happy New Year in February? It's March, but originally we meant to record this in January and I thought we worked on such a good episode that I'm going to just roll with it. If we're talking about it being January and it's still cold. Nothing has sprung in the garden. Why not? Okay. Put ourselves in mind there. Do you have any New Year's resolutions?

00:01:05:21 - 00:01:28:17

Lou

I mean, not now. It's March, but I have long since cast aside. But do you keep any. Do you do resolutions? Not really. I mean, my like, my personal motto is, in hindsight, that was a little bit ambitious. So I've kind of learned now that I'm basically massively overambitious with most things in life.

00:01:28:19 - 00:01:50:22

Sarah

So setting goals is something I don't need to do, basically. But it made us when we were thinking of the first episode for a podcast, talking about resolutions, kind of got us along the route to what we're going to talk about today. We went to see in January, actually just at the turn of the New Year, a film by the wonderful director, Jeanie Finlay, called Your Fat Friends, which is great.

00:01:51:00 - 00:02:14:06

Sarah

Recommend you going to see it. And it was a really interesting journey into understanding the word fat and the diet industry. Not necessarily a film just about diet industry actually around the amazing author of Your Fat Friend, Aubrey Gordon. But there was this one bit, the student in the film to me that Aubrey said, and I'm going to get the fact, you know, I'm not going to get it exactly right.

00:02:14:06 - 00:02:43:16

Sarah

But it said something around people that go on a diet, and these kind of fad diets are like four times or something more likely to put the weight back on. And once they're off that diet and it made us stop thinking about resolutions and the kind of push from the industry, lifestyle, health industries on like nudging people into these get, you know, get fit, lose the weight, you know, get rid of that Christmas meal that you've had, have this big purchase, this annual get 25% off.

00:02:43:18 - 00:03:10:00

Sarah

And we were just like, got it. Feels like so pushy, doesn't it? Mm hmm. Like really trying to get people to sign up to these things that are kind of whole year in because you're preying on people. Sort of like maybe like they feel inadequacies or a lack of confidence or whatever it is. And I started looking into this this idea of false hope around like diet, industry and lifestyle went on a real kind of dead ends like Little Journey.

00:03:10:02 - 00:03:34:04

Sarah

And I found this little story of a woman who's a kind of feminist offer called Susie Orbach, who was invited into parliament and gave a sort of testimony to MPs to talk about people going into like slimming world and Weight Watchers often being locked into these. Like she used the word life long straight jackets and unrealistic expectations about weight loss.

00:03:34:04 - 00:03:55:09

Sarah

And so she kind of gave evidence. And I think people just started to ask questions about it. And I'm not here to say people shouldn't do swimming, slimming world or Weight Watchers. You know, I think you do you and you do what is right for you around your body, your lifestyle. I'm not here to police it in any format, but I just really got me thinking about the word she used straight jacket for the rest of their lives.

00:03:55:11 - 00:04:16:14

Sarah

So it really got us thinking about lock ins. And, you know, if you look up the meaning of the term, there's lots of language that surrounds it, like vendor lock in, proprietary lock in. But the one that got us really thinking was this term of customer lock in, making customers dependent on, you know, a company for products or maybe unable to use another without switching costs.

00:04:16:14 - 00:04:40:07

Sarah

And so we thought we do an excellent job on lock in rights is something that happens a lot to customers. Yeah yeah. Is it something that happens a lot to customers? And I think we're much more familiar with more formal terms of of lock in like the ones you mentioned, you know, offender lock in where you have a really long contract between you and another organization that's providing part of your service for example.

00:04:40:07 - 00:05:09:18

Sarah

But that customer lock in is something that often we rely on in the background of our services. We rely on subscriptions or we rely on customers being loyal to us or buying something repeatedly. It is something that I think many services in particular, although they may not necessarily explicitly have a lock in do. And so it's a very common pattern for better and worse in a lot of services.

00:05:09:18 - 00:05:34:20

Lou

And that's why it got us thinking about this. And you, I think, have a personal experience of being locked into something that was hard to cancel, which is a good example. I don't know if you want to share that. I mean, I don't know if I want to share it, but oh, sure. Anyway, so yeah, I mean, just recently I was actually trying to take a temporary post from a gym.

00:05:34:20 - 00:05:52:00

Sarah

I was kind of traveling quite a lot. I wasn't in the area that I was going to be going to that gym. So yeah, I tried to not cancel, but just temporarily pause. And one of the reasons I joined this gym is that they allow you to do it. I thought it was great. You know, if you're going away for up to six months, you can just pause the membership.

00:05:52:00 - 00:06:10:20

Sarah

There's no new sign up fees. So fantastic. And when I actually signed up at the front desk, they said, just get in contact with them and ask. So went onto the website, used the contact form, got in contact with them as I was instructed, you know, I'm going away. I won't be able to use a gym. Can I, like not, you know, not get charged.

00:06:10:22 - 00:06:30:10

Sarah

And I didn't hear anything, but I saw the form had just gone into the ether, really, and that that would happen. And then like a few months later, I suddenly started seeing on mobile again. And so this didn't get canceled. And so I actually got in touch with them and they said that I should have checked the terms and conditions and everyone knows terms and conditions.

00:06:30:10 - 00:07:02:10

Sarah

TS and CS are often in tiny font hidden away in the future of a website or in a sign up process. And I was supposed to email a very specific email address about it, and they had no way. I had no way of proving that I'd sent this form because I didn't get any copy of it. Anyway, long story short, after threatening them with the public sector web and more failed 2018 accessibility law by saying it was very unclear for me to understand what to do, they eventually caved in and gave me my money back and I'm still a member of the gym sheepishly.

00:07:02:12 - 00:07:35:01

Lou

I love that after all of that, you're still a member of the gym and this is why I call you. Drummond returns, because literally if I need anything returned, any kind of refund, Sarah will be the one to do it because you seem to have an ability to basically push forward through all of those barriers that are put in the way of just making something either impossible to return something or cancel something or just very, very hard to do it.

00:07:35:05 - 00:07:53:21

Sarah

But I also think that that is a special skill. Yeah, well, I mean, you know, everyone has, right? I mean, I got I mean, guys, I got money back from Amazon Prime. I got over £160 back from a double account that was created by accident and in the US for £160. And that was my Pete. What did they say?

00:07:53:21 - 00:08:20:16

Sarah

Piece to the Resistance? What? How do you buy this? (Lou) Definitely your piece to resistance. (Sarah) Okay. We can't even say, Yeah, it was not good. We were basking in the finest moment. Finest moment. But. Right. We find, like, in experiences in everything and it is often a high barrier to stopping someone doing something right. It is. And I think it's worth saying that this hard to cancel pattern that we see in so many different services is a real thing.

00:08:20:16 - 00:08:43:10

Lou

So much of a real thing that is featured is probably one of the most common and prominent patterns on Doctor Harry Brignull's, website, Deceptive Patterns, which, if you've not seen it, do you go and have a look? It's a list of all sorts of different deceptive patterns that makes users do different thing and lots of different ways to make users do certain things.

00:08:43:10 - 00:09:10:02

Lou

And there is one pattern on there called the roach motel pattern, which is described as basically a deceptive pattern where it is easy to sign up for a service or subscription, but very difficult to cancel it. This typically involves hiding the cancellation option, requiring users to call customer services or to cancel and making the cancellation process overly complex and time consuming.

00:09:10:04 - 00:09:39:07

Lou

So this is a thing that is, I think, used in lots of different ways. And as I said before, kind of explicitly and implicitly, like some some services just don't even really think about doing this. Other services will do this very, very deliberately. So either way, what we're doing is basically creating barriers. The either completely meaning use it gives up or it's so hard to council that basically they run out of steam unless, of course, you are Sarah Drummond and you have an infinite amount steam to get every refund.

00:09:39:09 - 00:09:58:06

Sarah

I don't know if I have an incident of I can't even say it. I don't know if I have an incident amount of steam. I think I just have a strong sense of service. Justice is how I would describe it. But, you know, it's so frustrating when I look at services doing this because it just feels so unfair to the users and to the customers.

00:09:58:08 - 00:10:25:02

Sarah

And I actually got to vicariously not quite meet, you know, when you're on a big zoom call with lots of faces. But I was in a Zoom call with Harry, actually, who runs Deceptive patterns because Citizens Advice, the team they're working aligned with ritual called COP, had done this report called Tricks of the Trade. And actually looking at more deceptive patterns that inhibit users from really getting justice and using the services that they're paying for.

00:10:25:04 - 00:10:41:11

Sarah

And I think it was really interesting actually, about these sort of deceptive patterns is they fly in the face of actually some of the regulations that we have in different countries. So, you know, we're broadcasting today from the UK. So talk more about UK rules. But there are laws across the world which actually are there to protect consumers.

00:10:41:16 - 00:11:08:18

Sarah

In the UK we have something called trading standards. They're the kind of like enforcer of consumer protection legislation, looking after laws like the consumer protection from unfair trading regulations 2008 and the Consumer Rights Act of 2015. And they stop companies or they're supposed to be there to stop companies from doing things like fake endorsements, bait advertising. That's when you advertise a certain price.

00:11:08:18 - 00:11:23:20

Sarah

When the trader knows they cannot, you know, offer that product or only has a few stock in that price and or pressurizing customers to make decisions like, I don't know, do you want to make sure that you sit next to this person on the flight? We really do. Or we really do, or you must buy it or buy it.

00:11:23:20 - 00:11:50:23

Sarah

Oh, quick to see. So there's lots of stuff in there in the law actually, that really is saying we shouldn't be experiencing these kinds of design patterns. But we we do. And I think what's interesting, it's worth folks listening, taking a look at the digital markets competition and Consumers Bill, which is currently in the UK going through the House of Lords, but it's really there to try and introduce even more kind of consumer rights, particularly as we see more services.

00:11:51:00 - 00:12:12:00

Sarah

I mean, this is a really obvious thing to say about being digital, but it often takes a lot of really long time to catch up with what's actually happening out there in the industry. And I remember Harry saying something on this call that I thought was really interesting is that the strengths of these laws is only if somebody gets brought to justice, and that then creates a precedent in how we will design stuff in the future.

00:12:12:00 - 00:12:34:00

Sarah

And it's not common that we actually see customers winning stuff. And I, I think we had a chat, Lou, that you'd seen a case actually that was really interesting where someone took an organization to court over a deceptive pattern. Yeah, there is a really interesting case that backs up and like you say, there are a lot of cases because it takes quite a lot of money to get something through the courts.

00:12:34:02 - 00:12:59:04

Lou

So generally speaking, there isn't a lot of case law of people protesting against bad services in in any way, which is one of my favorite topics. But there is a really interesting case that came through in 2022 against the dieting service NOOM, and that was brought forward by a customer called Sylvia Mahmood Ahmed, and she was doing on behalf of a claimants.

00:12:59:04 - 00:13:35:08

Lou

And basically her point was that and I'll read part of the court case against name, she said basically Nim's website and app both lead customers through a lengthy evaluation which asks the customer's height, current weight, ideal weight, gender and age. The evaluation continues with several multiple choice questions regarding the customer's fitness goals eating and exercise habits, medical history, home environment, marital status, weight loss, motivations and struggles and food reactions.

00:13:35:10 - 00:13:59:10

Lou

And her point was basically that once you have completed all of those things, you are really, really invested in not giving up the process. And by the way, this is before you've even signed up for a name service. So you're just kind of wondering along. You're thinking about using Noom, you've answered all of these questions. You are literally, you know, kind of you're the roach wandering through the motel.

00:13:59:16 - 00:14:25:18

Lou

The door is locking behind you because you've answered so many of these questions. And her point was essentially that the service promised a lot of things, but she didn't feel like it was effective. She didn't want to continue. But the major way that the customers had to be able to cancel the service was basically through talking to their coach.

00:14:25:20 - 00:14:51:21

Lou

But the coach never materialized. The coach was not a person that she could actually speak to. And so the court case goes on to say that Nim's website did not offer any mechanism for contacting anyone at the company Names website did not provide a fax or phone number, an email or mailing address, a customer service chat option, or any other way of contacting a noom representative and so noom.

00:14:52:01 - 00:15:14:02

Lou

I think it's worth saying, ignored thousands of complaints about this. This is not an isolated case. This person obviously took forward this court case and it's her name on on that case. But there was on on I'm sorry, it was in representation of many, many other customers. And they stated that you needed to contact your coach to cancel.

00:15:14:02 - 00:15:52:03

Lou

But coaches never basically materialized and there was no way of contacting that coach. So essentially you've wandered in, you've answered all of these really detailed questions. You're really invested in this process. And then when you want to cancel, there is no way of canceling. And I think what's really interesting about this class action is the it's and I, by the way, don't spend most of my time reading class actions, but it's the only one that I have ever seen that includes detailed screenshots and the description of that user journey, which is actually really, really fascinating to see.

00:15:52:05 - 00:16:13:12

Lou

Yeah. And they threw a bunch of different laws at them within this class action. So one of the contraventions that they said noom was in and with the defendant chasing this was called the false advertising violation of the California Automatic Renewal Law. And this is just one of the laws is actually mentioned in this. I got really into this class action reading.

00:16:13:12 - 00:16:45:16

Lou

It is really fascinating. And it's you know, it's as loose as it gets into actually really forensically picking apart the product and service design. You know, they they have this this section 103, the defendant committed unfair acts and practices by and I'll read this really quickly, stating the trial period last 14 days, stating and creating the net impression that the 14 day trial program is either free or cost no more than $18.37 stating and creating the impression that customers were able to easily cancel, omitting the fact that customers can cancel the Roman on Nim's website.

00:16:45:16 - 00:17:07:22

Lou

I mean, I'm reading fast like it's one of those kinds of, you know, advertisements that reads the stuff. Pretty small print really, really quickly. But it goes on. I mean, it's it's it's wild the different laws and they basically really going going after them. They have another one called the California Consumers Legal Remedies Act. I think there's a New York one throwing in there, if I could be misrepresenting that.

00:17:07:22 - 00:17:41:00

Unknown

But really, they're throwing the book at them. So what was the what was the result of this class action? Yes, the result of this class action was the Mahmud. Basically won her case and noone settled in in court for the total of $62 million. That's a lot. Yeah. It is a law actually to repay to those customers who were affected by this particular pattern, which sort of works out to roughly about 30 to $160 per name customer.

00:17:41:00 - 00:18:10:04

Lou

So pretty significant in terms of a payout to those customers. And I think I mean, it's really important that we should say that Noom did respond to this court case with quite a detailed blog post actually from the founders. And what they said was that while we disagree with the claims made in the suit, we believe that the settlement is the best path forward as it allows us to focus our energy on delivering the best possible health outcomes for our members.

00:18:10:04 - 00:18:49:03

Lou

They called them memos. Yes, they did, Nicole. And with that commitment in mind over the last 18 months, we have scaled our investment in customer experience by and I will list some of the things that they did, making cancellation even easier with 100% self-serve option in the Noom app via the name website. I will just say that is the the bare minimum but fine introduced new ways to make it easier to engage with our support team, including the addition of phone and chat based support and maintaining best in class timely service levels across all channels.

00:18:49:03 - 00:19:12:03

Lou

Do you think that chatbot support is just a bot? I mean, I wouldn't like to comment. I've never used noom. Maybe, maybe it is, maybe it's not. I would imagine that they probably are looking for ways to automate that because if they didn't have customer support, that's going to be an incredibly expensive addition to the service, significantly increasing the size of our support team.

00:19:12:03 - 00:19:35:17

Sarah

Will they? That answers your question, making subscription details even clearer and more readily available for numerous to refer back in their account portal and simplifying. Sorry, I keep interrupting, but I'm just like no one needs a portal for their account. Just no one don't do it. I mean, is it an account or is it a portal? It doesn't need to be both.

00:19:35:17 - 00:19:57:10

Sarah

Like, both of them mean the same thing. Account portal. Fine. Okay. Anyway, we're nit picking here. I was. I was nit picking. Okay. Sorry. Can you tell us all the things that Noom did to actually help users cancel? Well, lastly, also simplifying pricing and making it even clearer before you sign up when and how your name subscription will be charged and renewed.

00:19:57:12 - 00:20:28:19

Lou

I'd like to say here, but if I had someone saying I am making it even easier for you to do this thing, when I had basically won a court case saying that they weren't doing it at all and that maybe might not be my language. But anyway, Noom did respond and they have improved the service to make it easier, even easier for customers to basically understand what the service is, how much is going to cost, and to be able to cancel the service and get support.

00:20:28:19 - 00:20:56:23

Lou

So kudos to Noodles Noodle. Kudos to Noodles, Kudos to Noodles. You you kudos to Hi. It's new here. Time for short ad break. When we're not podcasting, we run the School of Good Services. That helps people and organizations learn how to design and deliver great services. We teach courses on service design, how to get by and for your work and what makes a good and a bad service.

00:20:57:00 - 00:21:24:14

Lou

So if you want to know more about that and to sign up to one of our courses, check out Good Got Services. Now back to the podcast here. Kudos to Noom for doing that. But does this does this happen like is this happening a lot? Like, is this an isolated case? Because this is wild, right? This is totally wild that someone actually managed to take some of these laws and get that amount of money, obviously split and goes back to people taking the case on.

00:21:24:14 - 00:22:02:01

Lou

But is this an isolated case? So, no, this isn't an isolated case. There's been loads of really fascinating examples, particularly here in the UK, of other areas, other industries that have basically locked in consumer through various different means. And there was a really interesting case in 2018 that was brought forward by systems of ice here again against banks, telcos, insurers, mobile phone companies and various others in a sort of so-called super complaint for basically charging loyal customers more than new customers.

00:22:02:01 - 00:22:31:08

Lou

So if you're an existing customer of a bank or a telco or another industry, you are much more likely to be paying more than a new customer. And in research across five different sectors, mobile phone companies, broadband, home insurance, mortgage and savings organizations, the Citizens Advice Bureau found that British consumers were basically losing £4.1 billion. So a huge amount of money basically in this so-called loyalty penalty.

00:22:31:08 - 00:22:53:14

Lou

So it added that eight in ten people were paying a significantly higher price in at least one of these different sectors for remaining with that particular supplier. And there are loads of examples of this in particularly in the telco industry. If you sign up to a contract that comes with a mobile phone, part of the cost of that contract will be the cost of the handset.

00:22:53:16 - 00:23:20:01

Lou

And obviously after a certain period of time you will have paid off the cost of that handset. But as a loyal customer, if you don't then renegotiate that contract, you continue to basically pay for that, that subsidy for the handset. So there are just so many examples of this and anyone who is listening to any kind of consumer watchdog program like Lbc's consumer rights, our with Dean Dunham on a Friday little plug there.

00:23:20:01 - 00:23:57:08

Lou

It's a brilliant show. It will know that basically the major topic of a lot of those conversations is basically how to get a refund for something that someone has bought accidentally or a contract that they have signed up to they can't get out of or something that where they're being asked to pay more than they really should do, as we've seen in those so-called kind of loyalty penalty examples, I feel like this is becoming a love letter to the Citizens Advice Bureau, but they do do so much amazing research work as we've seen that people might not actually know about it, as well as answering the phones, you know, taking questions from the general public

00:23:57:08 - 00:24:19:04

Sarah

and they have I feel like we're on one of those shows now. If you feel like you've been scammed or something has happened, they've actually got some really good advice about what you should be reporting to trading standards. Who I sort of briefly mentioned before. I think actually what's really funny about trading standards is when you go on, that was not funny, but it's interesting when you go on their website, they've got this kind of list of things that they've achieved in the year.

00:24:19:04 - 00:24:37:06

Sarah

And it always feels like, you know, we found 20 boxes of underwear on. Having 26 is even 26. Even a road is a road. Yeah, I think it's similar to Birmingham. Okay, cool. But like they find this stuff, you know, are these mobile phones counterfeit mobile phones. So these drugs were taken and that's probably more of the police.

00:24:37:06 - 00:25:10:04

Lou

But it feels very much like uncovering these sort of only fools and horses style schemes. But actually the work that the trading standards do, you can report to them because of the consumer acts that we mentioned are actually about if a business is again not being clear about pricing things that you were just talking about when it comes to the kind of telcos and banks or someone didn't carry out work properly that you'd agreed to like on your property, like kitchen fitters or things like this, or if someone tried to stop you, I don't know, using your legal right, it's like returning stuff.

00:25:10:04 - 00:25:32:08

Lou

So there are so many ways in which you can use the law and go to people like trading standards to try and get some extra support. And I'm really glad to hear from you that there are cases now where we're seeing this. I think this leads us to a really interesting predicament and the question, which is not helpful QUESTION because the world is horrible when we start blaming people for stuff, but who is to blame for this?

00:25:32:10 - 00:25:59:17

Lou

You know, we could really easily say it's the designers because they're the one designing the user interface, the user flows, the feature is taking features away, but it's probably really the business, actually the business that's setting the key performance indicators that are kind of forcing designers to put in place designs that get more from users, get more out of them, make more profits, make more money.

00:25:59:19 - 00:26:26:10

Lou

And but there's lots of tricks, right, that businesses know that they can use in adult to get users to import more money from them. Right? Yeah. And I think the roach motel pattern of basically getting someone to invest loads of time and effort in doing something only to then make it difficult to cancel that thing is a pattern of two halves, right?

00:26:26:10 - 00:26:57:11

Lou

It's both very difficult for you to cancel that thing, but it's also something where you have put in such a significant amount of effort to get to that point. The emotionally, it's very difficult to walk back from that moment in time. And that's what we saw in that example of noom. It wasn't just the fact you couldn't contact your coach, it was the fact that you'd already answered so many really personal questions about who you are and what your ambitions were, that it was really difficult to leave at that point anyway.

00:26:57:13 - 00:27:23:10

Lou

And I think this is a perfect example of what we call the sunk cost fallacy, which is a well-known economic principle to do with essentially the fact that once we have invested a huge amount of time or effort or something else in a particular process, we are much less likely to back out of that thing. And we see this all over the place.

00:27:23:10 - 00:27:43:02

Lou

This idea of kind of, Well, I'm here now, I can't leave essentially kind of going on. So yeah, I'm super interested in this idea of sunk cost fallacy. I did a bit of research actually into where the term had come from, and I came across a name, Richard Thaler, who's a pioneer of behavioral science, first kind of introducing this idea.

00:27:43:02 - 00:28:09:12

Sarah

And, you know, there was a bit of writing about where the term came from, but this one line stood out to me was that simply sunk? Cost fallacy goes along with the idea that it's better not to lose $20 than to find $20. Right? So there's a big thing in which you're saying about we don't want to lose money, but the bit that really actually stood out to me about this was the emotional and psychological labor side in leaving one thing and moving to another.

00:28:09:12 - 00:28:44:22

Sarah

So this kind of idea of switching costs, not just being about the monetary economic cost, but about the life idea and the emotional psychological labor that goes into leaving something that you've invested so much into. And we see this in all sorts of play out in all sorts of weird ways in life, right? Yeah. I mean, this really reminds me of something that happened to me years ago when I was a frieze art fair and I was an intern at a big gallery, and I had turned up basically to try and get in early and, you know, help out basically with the stall that we were running at the Frieze Art Show.

00:28:44:24 - 00:29:12:01

Lou

And I joined what I thought was the queue to get in to the exhibition. And I was there for probably about 25, 30 minutes waiting in this queue, but it wasn't going anywhere. And I started to realize that the queue felt a bit weird, like everyone was really calm. Meanwhile, also, it definitely seemed like other people were getting into the exhibition somehow, and I definitely felt like this key wasn't moving.

00:29:12:01 - 00:29:47:23

Lou

And anyway, long story short, I realized quite some time later actually having left that queue and realized that there was something very weird about it that it was of course art and it was a piece of work by a guy called Roman Undark, who has well known for his kind of social intervention artworks. But it was an artwork call taking a line for a walk and it was basically a queue as an artwork and a couple of people had started the queue and members of the public, like me, had basically joined that queue thinking that it was a queue to get in to something or to do something.

00:29:47:23 - 00:30:08:11

Lou

And we were perfect examples of that sunk cost fallacy, right? As soon as someone else joined the queue behind me, it became infinitely harder to leave that queue because I had invested time and effort in doing that thing. And I often think about this particular artwork when when sort of thinking about the sunk cost fallacy. It's such a British thing to do.

00:30:08:13 - 00:30:25:19

Sarah

I know you sound very British right now. We love in Britain. We love to queue. Yeah. Let me tell you about the queues that I have been in. Yeah, I know that you really don't like people skipping queues as well, so you're really like quite calm and passive when it comes to being when you're not passive. So maybe you try to adopt a passive.

00:30:26:00 - 00:30:50:12

Lou

I am, I am dying inside basically every time I join a queue, and particularly if someone seems like they are queue skipping ahead of me, it is like my one number one toll pipe. Yep. I never did. So interestingly bringing up the artwork because I never really thought about queues being a sort of very British. It feels like a queue all around the world, but it feels like a very British thing to do, like a sunk cost fallacy.

00:30:50:12 - 00:31:15:08

Lou

Queues are a kind of sunk cost fallacy. We don't want to leave them because we've invested so much of our time and we're going to get there. We're going to get there. I mean, if we seen where else do we see sunk cost fallacy? So there's a really interesting example from Sydney, and it's where the New South Wales Government in 2015 introduced a new policy to try and manage and basically stop violent alcohol based crime.

00:31:15:10 - 00:31:35:22

Lou

And it was called the lock out policy and basically it stopped you from leaving a bar after a certain hour and then being allowed to go into another bottle. So if you were drinking in that particular bar, you could carry on drinking there until quite late in the evening. But if you wanted to leave and then come back in or you wanted to leave, go get some food and then go somewhere else and you couldn't.

00:31:35:24 - 00:32:01:17

Lou

And it was a very successful policy in lots of different ways. There were lots of different studies on it, as you can imagine. And one 2015 study showed that there was a 26% reduction in assaults in that lockout area and a 32% reduction in the kind of wider area around that. So it was successful, but there were also some downsides to this.

00:32:01:17 - 00:32:22:13

Lou

And as you can imagine, if you are in one of those bars and I was in 2017, you very disincentive guys to leave because you have basically no other option of coming back in. So if you feel a bit snappish, you want to go and get something to eat. You can't you have to carry on drinking. So what happens in that situation?

00:32:22:13 - 00:32:54:05

Lou

Well, obviously you end up drinking more. And there was a 2017 study that actually showed a increase in the amount of alcohol based assaults in a wider surrounding area around the kind of central business district that this was implemented in. And it showed a 12% increase in assaults with a 17% increase in easy to reach areas. So once you've basically kind of downed your last drink, got on the train home, then there was an increase in the number of assaults.

00:32:54:05 - 00:33:15:24

Lou

And so people obviously ended up drinking more and causing more assaults further away from that area. And so I think this is a really good example of the fact that often when we think about these kind of lock ins, it's not really straightforward. Yes, you managed to keep a customer in your service for longer, but they can kind of feel pretty resentful when they leave.

00:33:16:05 - 00:33:47:09

Lou

So there are often, you know, kind of these really quite dramatically negative impacts when we see these these kind of lock ins happening. And I think if I were to kind of summarize how we got here, it's really a situation that we have created as we moved from products to services. And when we were in a world where we were producing Hoovers and vacuum cleaners and all sorts of other things, lock ins were just part and parcel of how you designed your product right?

00:33:47:09 - 00:34:12:21

Lou

You know, you wanted to make sure that you could only use the guaranteed parts for that particular product. And so the lock in was just part of buying that particular product. And we see this actually in things like video game consoles. You know, the Atari console, you could use many different video game cartridges in the Atari console. And of course, you know, they had no control over that market.

00:34:12:21 - 00:34:37:23

Lou

And so now we see video game consoles that do have control over who gets to produce cartridges and it's just them. So once you buy into a platform, you've bought into that platform. And that's what we've done with services and ultimately all of this comes back down to money. Of course it does, because if we invest in a service, if our service is really expensive, we're going to try and make that money back.

00:34:37:23 - 00:35:09:10

Lou

And money basically causes lock ins in services in lots of different ways. So what we see time and time again is the more expensive our service is, the more we will have to offset that cost through things like subscriptions. And this is why things like lifetime customer value is so important to us because of course it comes back to certainty if we're going to invest in improving a service or providing a service, we need to have certainty that that money is going to come back to us.

00:35:09:12 - 00:35:29:08

Lou

And as a digital service like Noom or any others, we need to give that certainty to our investors. And of course, what way do we give certainty by the number of customers we have and the regular subscriptions that we have? So subscription services are just a part and parcel of how we think about services now. But there are real double edged sword.

00:35:29:10 - 00:36:00:05

Sarah

It feels like this idea of lock in happens across the entirety of services, right? Like we've covered today, we've talked a lot about this kind of sunk cost fallacy idea where we're really relying on the fact that customers invested so much that we're going to keep them locked in. And I think what you're saying around the kind of cost to the business to recoup their money back is a lot around this idea of ensuring they like retain customers because the cost of acquiring customers is really high.

00:36:00:05 - 00:36:18:10

Lou

We know that from various friends we've talked to in start ups who've said actually the amount of money it takes and marketing, advertising, you know, word of mouth to get someone to just part of their cash in the first moment takes a lot of money. So once you've got them, you've got to lock them down. You've got to keep them in that relationship with you.

00:36:18:12 - 00:36:35:18

Lou

And it feels like this drive for profit leads to all types of dirty tricks when it comes to locking people in. So we're seeing across the whole service, we're seeing it from locking people right in at the start with these long term subscriptions we're seeing with it. You know, kind of keeping people, checking in with them all the time.

00:36:35:18 - 00:36:57:17

Lou

You UK, you get you want to stay, you want to say, yeah, we'll give you little bit more. You going to leave, You have to have this and right to the end where we just literally make totally undoable. Is that even a vibe undoable? You can't do that so you cannot leave. And that just feels criminal that we don't really actually let people leave relationships with organizations, right?

00:36:57:19 - 00:37:22:15

Lou

Yeah. And if you were to apply that to a relationship with a person in your life, like I think most people would describe that as pretty toxic, right? Like that, you literally force someone to not be able to to leave. It's the equivalent of basically locking the doors and, you know, taking away someone's car keys. Like it's not a good thing to do to a person in a relationship is not a good thing to do to your customers.

00:37:22:15 - 00:37:42:13

Lou

But I wonder when you look at some of these examples, if it is actually more of a crisis of confidence, actually of those organizations, because really what we should be aiming for is that people don't want to leave the service, right? Like, it's so good, it's so valuable to us. It's such good value for money that we want to stay loyal to that organization.

00:37:42:13 - 00:38:06:09

Lou

We want to carry on with that subscription because it's valuable to us. But it's almost like there's a kind of security policy in a lot of these relationships that if that suddenly changes, if we don't get what we need out of it, we can't leave. And if you were to think about someone that in a relationship context, it's often because that person is afraid that that person is going to leave.

00:38:06:09 - 00:38:26:22

Lou

Right. You know, I don't want to get too, too existential about this, but I do wonder if there is just this real crisis of confidence that's behind a lot of organizations not letting their customers leave. But no one really designs good endings. Right? And that's why we love to love your McCloud. Love, love to love Joes, McCloud, Joe's MacLeod's the plural of Joe.

00:38:26:24 - 00:38:52:14

Sarah

So many jobs, there should be more than one door. Joe To be honest, if you know Joe with his work, he does a lot of chatting about ends and he's got a really good book. He's got two books actually about ends that you should definitely check out, check out. And he trains and coaches people now on not overlooking endings, you know, and really looking into this from what we were talking about from a human perspective, but also organizations, products and services and their kind of digital experiences.

00:38:52:16 - 00:39:14:03

Sarah

Why we should leave. Enzo Right. Yeah. And on that note, perhaps we've reached a dead end. Do you think so? I think maybe. Maybe we've reached a dead end. Well, that's it. That's it for the Dead Ends podcast. This is what happens when we get together and we talk about a topic we sort of squirrel. We've yeah, interrelate topics, ideas.

00:39:14:03 - 00:39:37:05

Lou

And we've basically come to that end. Yeah. Tell us what you think if you have thought about lock in's endings, if you've enjoyed this podcast, if you have found it weird, if you could get a pub to 2 a.m. locked in. Yeah we wouldn't know. Yeah. So where can people get in touch with us? Well, you can get in touch with us on all of the normal social channels.

00:39:37:05 - 00:39:55:23

Lou

You can either find me at @loudowne or Sarah at all of the places that she's at, or you can go to good Dell Services and you can get in contact with us there. And if you have a topic that you would like us to talk about in a future podcast and you have ideas on that, we are very open.

00:39:55:23 - 00:40:20:02

Sarah

This is the first one that we've done. So who knows? This format might go in lots of different directions. It may not go anywhere. Yeah, it might be a dead end in and of itself. Who knows? It was fun. Yeah. Bye.

podcastdeadends

Sarah Drummond http://sarah-drummond.com/

Dead Ends: Lock Ins

In our first episode of Dead Ends, we talk being locked into products and services, queuing in an art work, the Sydney lock in rules and taking a well known dieting app to court

Dead Ends: Patterns