Duolingo’s Secret to Keeping You Hooked

0:00I think the best marketers and the best businesses lead. and that's why that people follow them. That's why they're excited to do that is because they make it very clear. This is where things are going and it's good for you and you should go this way. And so that's the first thing. Like they're willing to take a leadership position and anytime you take a leadership position, you gotta know that you're gonna have some arrows slung at you. I also think that when your prospects, when your customers, when your clients tell you that they want something, you should believe them. And if your job, if what your business does is help people achieve the outcome that they say they want, then you should do again, not whatever is within your means.

0:46You, I'm not saying that you go to this person's house and you like kidnap their cat and you say, look, you're not getting your cat back until you pass your Portuguese test, right? That would be a bridge too far.

1:04Hey, everybody. Welcome to another episode of Business Lunch with your host, Ryan Dice, and myself, Roland Frazier. It is wonderful to be back. Ryan, how are you doing? We just got back from a wonderful time off, and then you went and did something else. So you're either tired or feeling refreshed or... Yeah, maybe a little from column A, a little from column B. But no, I mean, it was good. You and I got to head out to UK, day, part board meeting, part, you know, partner retreat, part just kind of hang out and kick it. And so that was, that was really, really nice. Got to do that for, you know, for a week.

1:37And that was kind of on the back of some other family travel. So I'm now back in it. I mean, you know, this, I like to take a 30 day vacation. I found that that's been one of the most helpful things that I do, not just for me personally, but for the company. And so it was sort of broken up this year because my son had some college stuff, but I do actually feel very motivated and refreshed. And I found myself like working this weekend, not because like I had to, but because I just was like itching to get in and start building some things. So, um, yeah. What about you? Good. Just, uh, kind of same, just, uh, the, the trip was really great and then got back and, you know, hard in it for, for a week.

2:18And then this weekend just to kind of get, uh, get caught up on the, you know, the fun, interesting things that I like to do. And I always like researching, like kind of catching up on everything, finding things for us to talk about. And I came across this article that I sent you, which was near and dear, I guess, to both of our hearts, because you have had family experience with it and I have had direct experience with it. And that is that persnickety cagey little owl over at Duolingo. And I've seen and read quite a few deep dives on their marketing over the last four or five years. And they seem to be, to me, just brilliant.

2:58And I think I saw that either profits or revenues were up 50 % recently. And they just do a great job. But this article had a little bit of pushback because the gentleman was learning Portuguese for a trip. And he's like, I had the deadline. And so two weeks before I started doing it. I had a streak for two weeks. And then, and I like this, it says, it didn't take long for Duolingo's emails to shift in tone. One subject line read, it's been three days and it's got the like rolly eyes emoticon. And then it says, or emoji, the next day it asked, have you already gotten sick of learning Portuguese?

3:37And then the day after my favorite with the little smiley that's got its one eyebrow up and the hand on its chin, It says, it looks like you've learned how to say quitter in Portuguese. How?

3:55So he was basically just saying that this is an amazing job of bringing a brand's personality to life. And it's clearly been great. And they are following up, but not just, did you see my offer? Did you see my offer? Did you see my offer? They're following up in a brand personality congruent way, consistently, very emotional blackmail-y. They've gamified the app so that you've got these streets that you just don't want to break because why? I don't know. Does it mean anything? No, it doesn't. Not at all. But there's something about it that causes us to come back. I think I had right at a year of one language I was trying to learn on there.

4:46And I played with it over probably since it's come into being. And it's also interesting. I guess the little, this guy said in the article, I hadn't noticed it, but that the actual app icon turns from the happy, healthy green owl to like kind of an aged, decrepit owl when he doesn't get used on your app screen. They are absolutely brilliant at it. they sell, they sell the ability to, and I don't know if you can pay for it, but like you can use points towards it. The ability to get freeze diamonds and things to help you preserve a streak if you can't make it for a day. But I just wanted to talk about it a little bit because I think it's brilliant.

5:27And also does it go too far? And how can we learn from that as marketers? What are your thoughts? Hey, Ryan Dice here, co-host of Business Lunch. And before we get to the show, I have an exciting invitation for you. My business partner and business lunch co-host Roland Frazier and I are hosting a live in-person event and if you're a bootstrap business owner who wants to build a 10 million and even 100 million dollar business in the next three years you need to be there. This event is called Get Scalable Live and over the last four years it has transformed from a small gathering of entrepreneurs into the largest bootstrapped entrepreneurship conference in North America.

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7:22Again, that's GetScaleableLive.com, promo code LUNCH. It is truly amazing what can happen when you step out of the day-to-day and spend just a little bit of time surrounded by other powerful business owners. And since this opportunity only comes around once a year, you don't want to miss it. Again, the link is GetScaleAbleLive.com and don't forget to use promo code LUNCH at checkout to save up to 67 % off the full ticket price. That's all I got. I'll see you in Austin. All right, back to your regularly scheduled programming. Well, so first of all, the article that you're referencing, Business Insider and the headline is the world's meanest app.

8:04Duolingo subjects its users to emotional blackmail. Gen Z loves it. I think it's worth just pointing out again, the folks at Business Insider are just proving themselves to be just completely, you know, just, it's just, just such like crybabies. I don't know. I just, it drives me. Or is it just clickbait opportunists? Exactly. I mean, that's the thing. It's like their whole deal. Like you're doing exactly for what it's worth. You're doing exactly what you're railing. It's this app for doing. You've got clickbaity headlines and all this other stuff. So I want to separate just kind of like the tone of the article, because to me, it's just like whiny baby kind of reality stuff.

8:44But I do think it's important to acknowledge that, yeah, what Duolingo is doing is absolutely a form of manipulation. And I saw this with my youngest son, Timmy. You know, we were going to go, this was a couple years ago. You know, we're doing our family trip, 30-day vacation, like I talked about. We're going to be spending some time in Germany. And he decides I want to learn German. So he's like, can I get the Duolingo app? And this kid's like on a 400-plus day streak at 12 years old. Yeah, 12 years old learning German. I can't speak a lick of German, so I don't necessarily want to speak to the efficiency or efficacy rather of this particular language learning platform.

9:22But for sure, there was one night I remember he came down just bawling his eyes out because he thought he lost his streak. He didn't get it in and his iPad had died. And he's bawling. And I think people, you could argue that like, oh, this is therefore bad. had, we got to have a conversation with him as parents about like, let's talk about things that matter. Let's talk about responsibility. Let's talk about, you know, there were some good lessons for him to be had in there. So this idea of it being manipulative, I think it's possible to acknowledge that like, yeah, it probably is, you know, manipulative, but also to acknowledge that adults should be adults and should be responsible for their own stuff.

10:02And if you're going to let your kids do it. Parents should be parents. So can we set aside just the, is this wrong? And is this bad argument? Cause I just, to me, that's, I don't know. I think it's idiotic. What do you think? Actually, I would like to speak to it briefly. Um, because you, you know, you and I feel very similarly about things like that, but I think that not to get lost in our own, you know, uh, um, you know, uh, I can't call you an old man. I mean, I could, if I was 20, but not to get lost in our own, you know, like dad rhetoric. Is it unethical to manipulate your audience into doing the thing that you think serves them?

10:44Let's give Duolingo credit and say, we believe people that say they want to learn a language should be encouraged to learn a language at all costs is probably too far over on the spectrum. Not at all. And hope they just work is not enough, is it unethical to manipulate people into taking action to consume your product? Yeah. And I would argue that no, especially if you can make different arguments about whether or not the thing somebody wants to do is good or bad. And then you can decide what business you want to be in. I'm not going to be in a business that encourages smoking and drug use and pornography.

11:28I think that those things are bad. And so even if somebody says that they want it, I'm not necessarily going to be in a business that encourages those lifestyle. Because, you know, for me, I think that that's I think that's bad and unhelpful. In this case, how ethical is the result? Right. As the thing they want. Let's assume the thing they want. We don't have an ethical challenge with. Now we go to is the method is the means of getting them to consume the thing that we actually know they want. Right. Is, you know, where do we draw the line there? And how do how do people because I want to help everybody who's watching and listening first solve the moral dilemma or at least be able to analyze it.

12:07And so I think that first level is is the thing that we're ultimately trying to give them something that's not really that great for them. And if it isn't, then, you know, that's an ethical dilemma you've got to wrestle with and decide, you know, are you OK with that or not? We've obviously decided not. So then we get to. Yeah, OK, so they want it and and it's good for them. and we've got some tricks up our sleeves to kind of emotionally cause them to feel bad if they don't move in the direction which is the other thing it's that's negative reinforcement versus positive right so the positive is congratulations you're on day 45 of your streak and the negative is you know i guess you've learned how to say quitter in portuguese so so where how do we help people, including ourselves, think about where do you draw the line?

12:56Or is pretty much anything okay? I think the best marketers and the best businesses lead. And that's why that people follow them. That's why they're excited to do that is because they make it very clear, this is where things are going, and it's good for you, and you should go this way. And so that's the first thing, like they're willing to take a leadership position. And anytime you take a leadership position, you got to know that you're going to have some arrows slung at you. I also think that when your prospects, when your customers, when your clients tell you that they want something, you should believe them.

13:32And if your job, if what your business does is help people achieve the outcome that they say they want, then you should do, again, not whatever is within your means. I'm not saying that you go to this person's house and you kidnap their cat and you say, look, you're not getting your cat back until you pass your Portuguese test. That would be a bridge too far. But to say, hey, you said that you wanted this and you're not doing it, that kind of makes you a quitter to break out the stick. I don't think that that is a bad thing at all. I think it's actually in many cases a brave thing for a brand to do because they're going to get crap for it because people are going to get pissed off about it.

14:15Similarly, I don't think it's bad for a salesperson to follow up. Somebody opts in for something, they express interest. It's something that they've said that they're interested in. Their actions said that. You should believe them that they want it and you should take a leadership role in trying to get them to do this thing that while it's good for them is going to mean a change, which is hard for them. Not everybody's going to want to do it, but if you've decided that, yeah, as a business, we're certainly in the business of making money, but we're also in the business of helping people, changing lives, making an impact.

14:47That is going to require you to take the role of a leadership of a leader. You should absolutely deploy lots of benefit-based languages, lots of carrot, but when necessary, you should be willing to get out a little bit of a stick. Is there a line? And is it possible to cross that line and do some brands cross that line? Yeah. I don't know that that line is necessarily clear, but this idea that, oh, you should only use positive reinforcement to get somebody to do something, you're just not going to be as effective. You're just not. Statistically proven scientifically, right? Negative reinforcement works better.

15:20Okay. So some of the lessons, I just came across it. So the first quarter of 2024, the company reported 54 % year over year growth in daily active users, which is pretty impressive. 45 % growth in revenue and record profitability with over 31 million people paying to be on the platform. That's pretty crazy. What can we do if we don't have programmers that can create maybe the gamification to the level that those guys have? Is the first place in our messaging? Is it in retargeting? Is it in emails? What do you think some of the things that folks could do to help take advantage of what they learn from what Duolingo does?

16:07Because clearly they're having success. I think getting clear on the front end with your prospects and definitely with your clients, how do you define success? And if they're not sure, providing a means to define success for them. So, you know, in Duolingo, I'm not familiar enough with it, but obviously success is completing the different levels. So you want to complete the lessons and then you're leveling up and that's kind of how it gets gamified. I know with the scalable company, we would define success for a client. We're going to ask them, what is your three year target? Right. That's how we're going to define scale.

16:42Scale is increasing your sales profitability and enterprise value from X to Y in three years. So what is that? Some businesses know it. Some businesses don't. And so we'll say if you're unclear, we would recommend either double in three or top line to bottom line. So double in three is simply doubling your top line revenue and doubling your profitability in three years or go whatever your top line is today. let's set a goal of that being your bottom line profitability in three years. So I do think, again, this comes down to leadership and the best brands lead, but getting crystal clear on what is, what does winning look like to you?

17:18And if they're not sure, helping them to define it. That's the first step. I think, and everybody can do that. And that could be an aspect of a form they fill out where it's automated. That could be an aspect of a consultative sales onboarding conversation if what you're doing is more enterprise, if it's more professional service based. But I think that's the first that's the first step. And then when they tell you, I think it's your job to then believe them. And even when it gets hard to continue to follow up, even when it gets awkward, even when you know they're a little bit sick of hearing from you, even when I think this is important, you know, it risks the sale.

18:00And yeah, it's possible to cross a line. And I think we've all have received cold outreach from people who, you know, they reach out to us, we don't know who this person is. And then like message six or seven, they're like, you know, I guess clearly you don't care about this thing. Like, I think if it's a cold outreach, you haven't earned the right to take that posture and take that tone. But if it's an inbound inquiry, if it's an active customer or a client, I think you have earned that. And that's where I would say the other piece is to get permission early on, especially with your clients. hey, if this is what you want, can I have permission at times to really to push back and to lean in and to maybe kind of call you on on some BS if it's there to maybe give you a kick in the pants?

18:39And I think asking for permission, and this might be something that Duolingo might even do in the early stages where they would ask. You know, we found that our that our members respond when we frankly, you know, poke them and get a little bit snarky. like, how would you like to set your snarco meter? You know, do you want to like a 10 out of 10 where we are going to come to your house and steal your cat and not give it back to you until you complete your lessons or zero to zero. Like it's only this. So I think getting permission on the front end would kind of be step two. And then yeah, step, step three is being willing to follow up with both the carrot and stick and understanding that, um, that when you do reach out and when you hold up a mirror in front of somebody's face and you kind of speak truth into their life, if it's on something small like language learning or if it's on something, you know, bigger, fitness is a big aspect of this.

19:32Just know that some people are going to get mad at you and that's okay because that's you doing your job and you can't take the negative criticism as a reason that you should stop doing it. The only thing I think you should, not the only thing, the primary thing you should look on is what are your success rates? Because if your customers, if your clients are successful, then your methods are working, you know, focus, focus on that. Obviously, if you're getting lots and lots and lots of negative feedback, if people are like hating on your brand, then maybe you're pushing it too far. But I think you need to be willing to go there.

20:07I think most brands aren't willing to go there. I think about like Southwest Airlines, right? Who planted a flag and said, like, we're not going to serve food and we're not going to do these things. And they're, you know, they'll get a letter from a customer who's like, how dare you? I can't believe that you won't let me, you know, pick my seat ahead of time, which they're now doing. I can't believe you won't offer meals. And they get a letter from the CEO that simply says, we'll miss you. That's leadership. And I think the best brands are willing to offend for the sake of their clients and for the sake of the overall mission.

20:37So I agree. I think that our overly PC world is, It's not how things really are. It's just not how it is. We try, but... So the other thing that they were talking about in the article, they said research suggests it's especially risky to deploy marketing campaigns that make people feel bad about themselves. A 2010 study found that the use of guilt and shame in anti-drinking ads triggered a defensive response that actually made their target viewers likelier to drink more. If people feel that they're constantly bumping up against reminders of their failure, they may decide they're no longer having fun and want to move on.

21:16So that's one thing I want to talk about. But at the same time, Duolingo says that it's guilt-tripping notifications do the trick of enticing people to drop whatever they're doing and log onto the app. Spokesperson told a magazine in 2020 that other options for re-engaging users were between 5 % and 8 % less effective, which isn't that much, really. um but uh but over 31 million users that's a lot that's that that can be quite a few and and a lot of uh a lot of money so it's kind of interesting that that there's research that says don't don't make them feel bad but at the same time i think it might be don't make them feel bad about themselves more like like if you think about drinking it's like if if you're shaming somebody about drinking is that I'm an alcoholic and that's a label that's got so much social negativity that we don't want to be reminded of it as opposed to, hey, remember you wanted to learn a language is more about your habit of learning the language or your commitment to yourself.

22:17It's not a label that you are, you know, a non-language learner, which is a, you know, a thing that society doesn't like. What are your thoughts about that? I think those two, I think the study they mentioned has nothing to do with Duolingo. I think there's an incredibly important difference, which is if you're just running anti-drinking ads, that is cold outreach. These are not people who have requested to receive anti-drinking ads. These are not people who are in some type of substance abuse program. Like, I think if somebody is in that, then like, we both have known people who have gone through substance abuse program while they don't, you know, lean into like shame.

22:57And it's a highly supportive type thing, you know, if you miss your meeting, your sponsor is going to reach out to be like, what the heck, where were you? You know, I mean, there's, there is both, there's an, there's a tremendous amount of, of, of positive reinforcement, but there's also a fair bit of accountability and a, Hey, you said that this is who you are now and that you're not this person anymore. You know, you can call that shame or you can call that accountability. I don't like that's to me, that's a, that's a bit of a spectrum and kind of in the eye of the beholder. but I think that there's a fundamental difference between I have opted in for this app.

23:32I have said I want to learn a language. If I just got, if somebody just was randomly reaching out to me, being like, quitter, why on earth aren't you learning Portuguese? I'd be like, what's wrong with you? I never asked. I never said I wanted to learn Portuguese. The biggest difference is they've opted in. They have said, and that's why that step one is so important. Getting crystal clear with your leads, with your prospects, with your customers, with your clients, what does success look like for you? Once you have asked that question, got an answer and believed, and you've aligned with them and said, I agree.

24:03That is a good thing. You're right to want it. We can help you get it. That's when I think you've earned the right to leverage the stick. And until you have done that, I would agree with it. You shouldn't leverage the stick. You have not earned the right to speak truth into this person's life. And I think we're talking about the difference between inbound and outbound. And that clearly the author of this does not understand the distinction between that. But I think it's big. It's huge. And it's why, how you go about doing outreach. Like if you're going to do cold outreach, I think your methodology should be fundamentally different than if it's inbound and you're following up with existing leads and customers.

24:46So you have permission to, you have a greater level of permission, but you have a greater level of permission to engage in that nagging kind of behavior. If somebody's opted into it, basically is what you're saying. And especially if you've literally asked for permission. Like if you've said again, like step one, let's get agreement on what success looks like step two, get permission to, hey, can I, in the beginning, before anybody's failed yet, before any shame has entered in, do I have permission to kind of nag you about this, to give you a kick in the pants when you need it? So, I mean, whether you get kind of passive permission or direct active permission, yeah, I think that that is important if you're going to take on that role of saying, hey, you're not doing what you said you would do, whether that is in a proactive email outreach, whether it's in a follow-up phone call or whether it's in a owl going from green and happy to like sad and gray.

25:48There's an author that they quote in here of a book called Hoodwinked How Marketers Use the Same Tactics as Colts. And that person said that ethical lines get crossed when a brand attracts consumers under a false premise or doesn't let them disengage, which I think that's that's important as well. Like if they nag you and you're like, you know, no. And they're like, you know, well, you said that you wanted to opt out, but we're still talking to you. She cited multi-level marketing schemes as one example of a business model that routinely draws on both of these unethical tactics, relying on bombarding customers with communication, then withholding delivery of the promised goods or services until the customer gives more of their time, money, or both.