[Product Teardown] How Shopee Leverages Psychology to Make You Stick

Aug 2021 6-minute read

As part of my journey to learn product management in public, I’ll do a series of product teardowns focusing on connecting product design with psychology. I’ve been enamored with persuasive technology since my startup days a decade ago as it’s fascinating to see how colors or software can alter your emotions and actions.

How people feel and think are important considerations in a product design and flow. I’m excited to tap into this interest again (dusting that decaying Psychology degree I earned years ago) in my journey to exploring product management. For starters, I’d examine a couple of features on Shopee.

What is Shopee?

Pieced from Wikipedia, Shopee Pte Ltd is a Singaporean multinational social-first, mobile-centric e-commerce marketplace where users can browse, shop, and sell. Shopee was first launched in Singapore in 2015 and later expanded its reach to Southeast Asia and Latin America.

Shopee-pee-pee-pee is also behind this catchy tune.


Why analyse Shopee?

Sometime around the middle of 2020, I was HOOKED on Shopee. I would check it multiple times a day because I enjoyed the “high” when I scored a good deal and I felt anxious about what I’m missing out on. The product worked so well on me that I bought so many things that I didn’t need.

I wasn’t paying attention to how I was feeling and acting until a good 6-month or so, and when I did, I was both impressed and horrified at how the product was designed that I stopped using it.

This breakdown examines 2 main features that made me stick, why I stopped using Shopee, and how I would improve on it.

[Psychology of Collecting] Collecting Coins to Save Money

The psychology of collecting is an area of study that seeks to understand the motivating factors why people devote great amounts of time, money, and energy to making and maintaining collections. - Wikipedia

Shopee gives out digital coins for use on the app. Each coin is worth 1 cent, which isn’t a lot, but these coins do not expire and can be accumulated to offset any purchases.

Coins are incentives for actions they want users to perform, such as writing merchandise reviews and checking into the app. On the latter, you gain one and increasingly more coins for every subsequent day you check in on the app. The cycle ends after 7 days and automatically resets thereafter. The count also resets if you missed a day in the cycle.

I hated missing a day because it’s a broken series and I lose out on gaining money. It’s interesting to observe that this was more emotional than rational. After all, the total reward I could get from 7 days was less than a dollar.

By tapping into people’s desire to complete a collection, Shopee built a retention feature on the cheap. Spending $1 to retain a user consistently for 7 days is a pretty good deal!

Speaking of deals…

[Scarcity] Multiple Flash Sales Every Day

The scarcity heuristic is a mental shortcut that places a value on an item based on how easily it might be lost, especially to competitors. - Wikipedia

I love the high when I score a good deal and I hate the reverse when I miss out on one. That makes me a complete sucker to flash sales, which Shopee is incredibly good at.

Shopee runs a handful of flash sales every day, with each lasting anything from 1 - 8 hours. On special occasions, they may run flash sales in 15-min increments. That led to some competitive shopping behavior in me, especially when there is a progress bar signaling how many items are left for sale.

Adding a countdown timer and progress bar are neat concepts, and these are made more powerful with the selection of items that go on sale. I seldom see anything that is outrightly useless. Items on sale are typically things that you can use that you might not know that you want.

It’s just a great feature for product discovery at lowered prices. I found myself opening the app multiple times in a day to check what I can buy, which is great for Shopee but bad for my wallet.

So why did I stop using Shopee?

Despite all the praises I sang about Shopee, I eventually stopped using it that frequently because:

  • I discovered that some items offered during flash sales aren’t actually on discount. Other merchants are selling the same item at the same discounted price outside of the flash sale period. I suspect that there may be some artificial inflation on price to create the illusion of a good deal.
  • Items genuinely on discount during flash sales can be back on later flash sales. This, and the reason above, meant that there was no real scarcity at play here.
  • I simply don’t need more anxiety nor do I need to spend more money, especially during the pandemic.

Essentially, the upsides of the sticky features no longer outweigh the downsides of the negative emotions I have from using the app. So I decided to quit obsessively using Shopee but bought their stocks instead because you know, it’s fun to score a deal. 😂

How would I improve the Shopee experience?

Shopee is a great product. To better mitigate the potential anxiety the features designed to make one stick brings, I’d suggest a better play of the psychology concepts discussed here:

  • Collecting: Using coin-collection to encourage people to log in every day is great. However, instead of resetting every user’s cycle when a day is missed, occasionally give second chances to repeat users. Send a notification to retained users to remind them that they have missed a day and have a chance to get back on track. Or even better, randomly give repeated users bonus coins when they finish a 7-day cycle. Such random moments of delight can mitigate any anxiety with missing a day and encourage higher product loyalty.
  • Scarcity: Flash sales are great, especially when items are genuinely on sale. However, instead of expecting all users to log in for all the flash sales, recommend users specific flash sales they might find interesting based on past purchases. Allowing users to better plan ahead lowers the FOMO and could lead to higher spend with less mindless browsing.

How was this teardown?

If you’ve read all the way down here, it’s about time I tell you that this is me.

How did I do? Any feedback on my suggestions or how I could improve? Let me know!