There’s a famous stat around Google search. Apparently for every 100 milliseconds the developers shaved off of search times, the number of searches went up several fold.
I think this phenomenon is everywhere, and is deeply underestimated. Particularly if you start with the assumption that cost is a combination of money, time, and effort.
Econ 101: the lower the cost of something, the more demand you have. If you can cheapen something enough, it has an overhelming effect…a lot more than I would have expected!
For example, if you make beef cheaper at the grocery store, you see more people buying it (and fewer people buying chicken). If you make beef more expensive, people will buy less. But what’s the true cost of using the beef? The true cost is not just the money you spend buying it, but the time you spend cooking and preparing it.
Which explains the popularity of McDonald’s. Fast food provides beef really cheaply (both in terms of money and in terms of time) and therefore get lots and lots of demand.
It was a set of technological innovations that allowed fast food chains to come into existence - the microwave, the deep fryer on a timer, frozen potato fries that could be made repeatably and consistently, large scale distribution, franchises, etc. But once those innovations were in place, it became almost too easy to make food, and therefore very cheap to eat it.
Obesity is a bigger problem (in the first world) than food scarcity because those innovations make it too easy to meet your caloric needs. For thousands of years humans were fighting to put enough food on the table, and now we fight not to put too much.
There’s lots of examples of cheapness causing outsized behavior in its favor. The cheapness is often created by an improvement in technology.
It should be noted that while technology makes things cheaper, it doesn’t necessarily make them better. It sometimes makes things worse, by meeting a surface level need but making the overall experience more shallow.
What are some other examples of this phenomenon?
Public transit
In Manhattan it is easier to go north or south than east or west because of how the subway system is arranged. If you measure the distribution of where and how New Yorkers spend time, it looks like an oval around where they live or where they work, with the long axis of the oval pointing north / south. The same phenomenon happens for SF residents of the Mission. In cases where public transit isn’t easy enough, the distribution is circular.
Social media
Social media makes it easier to do a bunch of things, and therefore gets outsized attention in proportion to its value. For example it’s easier to tweet than write essays, so tweeting seems way more popular than blogs. Watching gifs is cheaper than videos, so gifs get more popular. Messages lose nuance and become shorter, faster, and meme’d.
This probably applies to communication in general. The friends I previously called on the phone now prefer to text. Colleagues prefer slack to email, to their detriment.
Free vs non free
Free donuts at the office or free samples at Costco or free ebooks online all seem to incentivize tons of people to participate. Many now popular things started as free experiences for users which then juiced their popularity, after which they started charging money for them. One example of this is Andy Weir’s book The Martian, which was written serially, for free, on his website, and only after it reached popularity did it go through the normal publishing process and start to make money.
Home gym vs membership
The inertia to travel to the gym is its main cost (at steady state), and it seems to have an overwhelming influence on how often you go. Crappy home gyms are often used an order of magnitude more than fancy gym equipment 10 minutes away.
Similarly, walking to work is “cheap” compared to working from home and then proactively choosing to go on a walk (in this case, the price you pay is whatever motivational energy you have).
Organizational incentives
If you make it cheap to schedule a meeting (making calendars transparent, for example) then the organization, whatever its other goals, will have a lot of meetings. If you make it cheap to merge PRs, then more projects will get shipped to customers.
Unfortunately the above is usually only realized after organizations do the wrong things, i.e. keeping process and red tape cheap to add, but which makes getting products out the door expensive.
Snacks in view vs out of sight
It is cheaper to eat something on the kitchen table than find a different food buried in the pantry. Putting unhealthy foods in physically hard to reach places or out of sight means you don’t eat them, and is a demonstrated way of eating healthier.
“Contact us” vs “self-serve” pricing
Customers will find the cost of manually reaching out to a sales rep to be so annoying and frustrating that they will hardly ever do it, and so will go with a competitor who has transparent pricing and a billing flow that doesn’t require talking to a person first (even if that competitor is worse). Companies hoping to price discriminate for each customer sometimes find themselves with fewer customers, none of whom are inbound.
This same effect can be seen with sign up flows. Forcing a user to register for your web application before using it will often mean you get an order of magnitude fewer users.
Reading list-like articles vs reading structured prose
Lists require less cognitive cost, so we would expect a priori for this post to be more popular than most of the other ones on this site. We would expect buzzfeed articles to have higher readership than the typical New Yorker piece.
It’s not obvious to me what the lessons of this should be. One lesson might be to “reduce barriers to entry”, which is all well and good, but sometimes those barriers to entry allow for a better and more deep experience. I don’t think I would recommend eating only fast food, or only texting friends rather than speaking to them on the phone.
Still, I think the power of cheapness in all its forms is a useful mechanism for understanding what groups of people are likely to do, whether it’s in their interests or not.