February 17, 2005

"How do you design for stickiness", asked Ziya in a post to the SIGIA discussion list recently. I responded by saying that that's a wrong question. I think aiming for "stickiness" or "lock-in" is a nefarious goal for a business. Here's my complete response as posted on the list:

Can we rephrase the question as: How do you design systems that favor customer loyalty?

By forgetting about stickiness, and delivering such exceptional value over other competitive products/services that customers keep coming back for more.

At least this is one of the lessons I take from the Google vs Yahoo approach. Yahoo's strategy to this day has been to be the only place where customers go for everything. Their search engine in late 90s reflected this approach as it included results from Yahoo's directory and other properties. The idea was to keep the user on their site for as long as possible [it suited their main revenue stream at that time-- banner advertising].

Google took the opposite route. Google came with a singular focus on helping users find the best sources of information as quickly as possible. They want you to leave their site. The value that their search provided [accuracy of results] was so strong that people kept going back to it. As Google founders say in their interviews [1], if people really care about the information they're looking for, they're not going to stick with one service. They will look at a multitude of sources to find the best one.

Stickiness, if it means doing everything you can to ensure users only use your service, is an evil goal ultimately even though it might seem to work well in the short term. Yahoo's strategy is a "push" strategy, supply focussed rather than the pull strategy of Google, demand focussed. We know who's winning.

Of course, it might not work for everyone. What's critical here is to deliver exceptional value to users that they don't find anywhere else.

[1] Interview 1 Sergey Brin:
My personal feeling is that people focus a little too much on these integration questions. I think if you have a subject you really care about, like if you have diabetes and you want to figure out the latest research on something like that, you're going to use the best research tool in terms of the messengering service you use.

Interview 2 Larry Page:
PLAYBOY: Many Internet companies were founded as portals. It was assumed that the more services you provided, the longer people would stay on your website and the more revenue you could generate from advertising and pay services.

PAGE: We built a business on the opposite message. We want you to come to Google and quickly find what you want. Then we're happy to send you to the other sites. In fact, that's the point. The portal strategy tries to own all of the information.

PLAYBOY: Portals attempt to create what they call sticky content to keep a user as long as possible.

PAGE: That's the problem. Most portals show their own content above content elsewhere on the web. We feel that's a conflict of interest, analogous to taking money for search results. Their search engine doesn't necessarily provide the best results; it provides the portal's results. Google conscientiously tries to stay away from that. We want to get you out of Google and to the right place as fast as possible. It 's a very different model.

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