"Keep Them Coming Back: Rethinking the Social Responsibility of Business"

"Keep Them Coming Back: Rethinking the Social Responsibility of Business"

In today's competitive business landscape, it is not enough for a company to simply provide a product or service that meets a customer's basic needs. To truly succeed and keep customers coming back, founders must understand how their product makes users feel. It's all about creating an emotional experience that leaves users saying "wow" and telling their friends about it.

This understanding of emotional valence is especially important for products that fall into the entertainment category. Whether it's a video game or a social media platform, users are constantly seeking out experiences that provide entertainment value. Founders must recognize this and build their products accordingly.

But how do founders go about creating habits and capturing the monopoly of the mind? It starts with satisfying a user need and ensuring sufficient frequency of use. A product must provide real lasting value to users, and it must be used frequently enough to become a habit.

To achieve this, founders must consider the psychology of their users. They must understand the triggers that prompt action, whether they are internal emotional states or external cues. The action phase must be simple and easy to do, as the easier something is, the more likely people are to do it.

The next step is the variable reward, which taps into the psychology of searching and seeking. Users should feel a sense of anticipation and excitement when using the product, never knowing what they will find next. This keeps them coming back for more.

Finally, founders must consider the investment phase, where users put something into the product to increase the likelihood of returning. This could be as simple as loading the next trigger or building up stored value, such as reputation or followers on a platform.

But what about the social responsibility of business? This is a topic that has been debated for years, with some arguing that the sole responsibility of a business is to maximize profits. However, others, like John Mackey, the founder and CEO of Whole Foods, believe that businesses have a broader responsibility to their stakeholders.

Mackey argues that the purpose of a business should be to create value for all of its stakeholders, including customers, employees, investors, vendors, communities, and the environment. He believes that maximizing long-term shareholder value goes hand in hand with caring about customers and employees.

While Milton Friedman may have argued that corporate philanthropy is a violation of a company's fiduciary responsibility to maximize profits, Mackey sees it as a way to create goodwill and build long-term positive relationships with stakeholders. He believes that businesses should be able to make voluntary decisions about their social responsibility.

Ultimately, the goal is to find a balance between maximizing profits and serving the needs of all stakeholders. A business should aim to create value for its customers, employees, investors, and communities, while also staying within the rules of the game and operating without deception or fraud.

In conclusion, founders must understand how their product makes users feel and create an emotional experience that keeps them coming back. They must also consider the social responsibility of their business and find a balance between maximizing profits and serving the needs of all stakeholders. Here are three actionable pieces of advice for founders:

1. Focus on creating an emotional experience for users. Understand what makes them say "wow" and engineer your product to deliver that experience.
2. Consider the psychology of your users when designing your product. Think about the triggers that prompt action, the simplicity of the action phase, and the variable rewards that keep users engaged.
3. Find a balance between maximizing profits and serving the needs of all stakeholders. Aim to create value for your customers, employees, investors, and communities, while also staying within the rules of the game.

By following these steps, founders can create habit-forming products that keep users coming back and also fulfill their social responsibility as business leaders.