To the entrepreneurs reading this, please do not use this as a checklist of things you need to put into your products. For the rest of you beware and avoid such products and site that use these techniques to make you behave in ways you would not otherwise.
Capitalism has always been about growth. Money chases whatever grows, however it grows. Startups are able to raise money from investors when they are able to show that they can grow fast. Fast like in quintupling their size each year. It is not called Shark Tank without a reason. In the pursuit of delivering that kind of growth developers and businesses have figured out ways to use designs against the user instead of for the user.
Here are examples of some of the dark patterns that are often used.
Something that you did not order was inserted into your basket. The other variant of this is adding a cost that was not initially informed. This usually shows up as convenience cost, which itself is conveniently inserted in the last page just before you are about to hit buy. BookMyShow is a faithful user of this trick.
A countdown timer that is always on the site, is another way to tricking the user into thinking that the offer is for a limited period and I have seen several SaaS sites also put this to use. Only, when I found it there every day, I started to wonder how!
There are several examples of misdirection but the ultimate goal is to make the user choose what you want them to. This is often done by making the text size of the ‘No’ option very small. In the example above the option is coloured in such a way as to look inactive.
Here the user is made to believe that many others are also interested in the same product. This trick is also used a lot by travel sites when you go to book packages. It makes it seem like lots of people are interested in the same trip and some tweak it to seem like the inventory is about to run out. This adds urgency to the mix of social proof.
As soon as you add a product to your cart, it makes it seem like you need to rush through to the purchase because the item is running out.
Many companies are guilty of this trick. For all the weeping about the Apple App Store and the power that they possess, they make it damn simple to unsubscribe. Here in this example, you can sign up for the subscription online but to unsubscribe you need to call a number that is mercifully open 24X7.
In order to accept one action, you need to agree to another. This is not a choice. In the above example, you are forced to accept the mailers to accept the terms and conditions.
Examples taken from Princeton.
Not just small and unknown companies but even the most well-known companies in the world engage in this. If you want to know how? Try to close your Amazon account. Yes it can be done. After wasting 25 minutes, you can watch the video below.https://www.youtube-nocookie.com/embed/kxkrdLI6e6M?rel=0&autoplay=0&showinfo=0&enablejsapi=0
Deliverance is coming
A new California law approved by voters in November will outlaw some dark patterns that steer people into giving companies more data than they intended. The California Privacy Rights Act is intended to strengthen the state’s landmark privacy law. The section of the new law defining user consent says that “agreement obtained through use of dark patterns does not constitute consent.”
The politicians in the US have decided to take a step towards putting an end to this menace. Not only the states, now even the federal government is starting to take interest in this matter.
A 2019 Senate bill would have banned tactics that “intentionally impair user autonomy, decision-making, or choice” and would have established a group to advise the F.T.C. on dark pattern enforcement. It failed to advance, but will be reintroduced during this session of Congress. Without such uniform federal legislation, a patchwork of state rules could lead to varying levels of enforcement and definitions of dark patterns — potentially creating more confusion for consumers and opportunity for unscrupulous businesses.
Source: New York Times
And why was it nixed?
Donald Trump’s 2020 campaign, for instance, used a website with pre-checked boxes that committed donors to give far more money than they had intended, a recent Times investigation found. That cost some consumers thousands of dollars that the campaign later repaid.
Source: New York Times
The good thing is that if the federal government is taking action in the US, this will most likely end up impacting users across the world, at least for sites that are active in the US even if they are based out of another country.
With GDPR also, we have noticed the same. It is very difficult for companies to discriminate between traffic coming from different countries and running a different version of the product. It forces enormous costs on them to do the same. As a result, legislation around anything to do with an internet product ends up trickling down to every nation. In some ways this is good because if a genuine issues does come up legislation even by one country can help billions of users across the globe.
On the flip side, this is further proof that a global and singular framework is needed for the internet. Being saddled unnecessarily with laws that are created by the sensibilities of one but affect everyone is not the best approach to take.
The other days I was watching a news report on a French channel and listened to a report on “Gaspillage alimentaire”. I was intrigued to learn a new word. I did not know what Gaspillage meant. This took me down a rabbit hole.
There is a lot of money in the food business. It also means that there is a huge amount of investment that goes into the production and distribution of food. But unlike most other products food has a very short shelf life and can expire very quickly. This poses a challenge.
One of the main reasons for food wastage is the expiry date which is not often the date beyond which you cannot use food but rather the suggested date after which it is not advised. Unless you actually open, chop-up and check, there is no way of knowing for sure.
Waste often exists across the supply chain right from the time of production to the transportation to the retail and then at home. By certain estimates one third of the food produced is wasted across the world. It is criminal. We could probably ensure nobody goes hungry with that much extra food.
The biggest source of waste is the household, followed by food services.
Retail is the smallest component of waste.
Most interestingly contrary to what most would assume, food wastage per capita is actually highest in the poorest countries. Part of the reason is the poor supply chain.
This brings me to the report I started out with. A company called ‘TooGoodToGo.fr‘ has launched an application in France which is working towards ensuring that retail wastage is brought down to zero. The company offers a subscription service which will deliver you a bag of grocery that was left unsold at the end of the day. Usually fresh fruits, vegetables, bread, etc. What comes to you is a complete lottery and based on what is available on that day, not on what you order. It is an interesting take on trying to reduce food waste in the channel.
The best thing is that the company is not looking to donate the food away but trying to turn it into a model where conscious individuals buy food that would otherwise go waste, at a discounted price. We need more such companies in this world.
Entertainment has been moving into new paradigms for the last 5 years. As internet speeds have shot up, it has made streaming incredibly easy and this, in turn, has meant that the entire universe of content is available at your fingertips, albeit at a cost.
As a production company, if you have already recovered all the cost of content development and them some more, you can undercut on pricing and make your offering very attractive.
Take Disney for example. The Avengers: Endgame alone grossed USD 2.7 Billion. This is still premium content. They can afford to give it away for free if they wished to. Instead, they turned it into a tentpole on their Disney+ streaming offering. Last February, when the world was going into lockdown, the company launched its subscription service. Today, it has over 103 Million subscribers in all of 15 months. By comparison Netflix has about 208 Million subscribers. If Disney retains its pace (which it will not) it will be larger than Netflix next year.
Content has therefore become very important and back catalogues even more so.
AT&T, just three years after buying Time Warner for $81 billion (and renaming it WarnerMedia), plans to spin off the entertainment company and combine it with Discovery, the owner of popular unscripted US TV channels like Food Network and TLC. AT&T will receive $43 billion in the deal. Its shareholders will own 71% of the new company, while Discovery’s investors will get 29%. Longtime Discovery CEO David Zaslav will lead the still-unnamed joint venture.
One thing that is becoming clear is that the content business cannot survive with another business AND whoever amasses the most amount of content will win the market.
Meanwhile, foes are turning friends. AMC the largest theatre chain cut a deal with Netflix to show their movies in theatres. They will have a 1-week exclusive window before the movie goes onto Netflix. Theatres used to have a 90 day window of exclusivity before the pandemic. They have realised beggars cannot be choosers.
Over the last couple of years, there has been a cornucopia of streaming providers who have rushed to release their offerings. NBC, Paramount, Apple, Amazon, Hulu, Sling and even Youtube. TimeWarner and Discovery will obviously continue to hold HBO which also has HBO Max.
Here in India also, we have Amazon Prime, Netflix, Disney+, Sony Liv, Alt Balaji, Zee5 and several others.
From a consumer point of view, people will pay for one or two services. Nobody wants to be paying for 5 services every month.
One of two things would happen.
Much like the telecom industry, there will be consolidation and one will buy the other till there are only 2 or 3 players left standing.
The cable TV model was essentially a play at aggregation and a similar model might be possible where an aggregator sits on top of all those with smaller market shares and sell their subscription on their behalf.
Obviously companies like Disney and Netflix who have painstakingly built direct relationships with their customers would not be interested in ceding control to a startup. But smaller players who have few paid users would probably be willing to do that if it would mean a meaningful uptick in subscriptions.
This is going to be a space worth watching out for. Anybody knows of any startup trying to aggregate this space?
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