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    Making Stickk Stick - Case Analysis - APO 4 - Section C

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    Debasya Sahoo
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    Making Stickk Stick - Case Analysis - APO 4 - Section C

    Uploaded by

    Debasya Sahoo
    6 views8 pages
    stickK case analysis and solution

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    Making stickK Stick - Case Analysis - APO 4 - Section C

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    stickK case analysis and solution

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    6 views8 pages

    Making Stickk Stick - Case Analysis - APO 4 - Section C

    Uploaded by

    Debasya Sahoo
    stickK case analysis and solution

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 8

    Making stickK Stick: The

    Business of Behavioral
    Economics
    Case Analysis - APO 4

    NAME ROLL NUMBER


    Aman Rohra 230103021
    Ayushi Bindroo 230103054
    Debasya Sahoo 230103059
    Divyansh Chauhan 230103072
    Gaurav Bhawsar 230103078
    Mankhushpreet Kaur 230103118
    Medhavi Mittal 230103123
    Case Overview
    StickK was founded in 2007 by Jordan Goldberg, Yale professors Ian Ayres, and Dean Karlan.
    stickK allows users to create commitment contracts to achieve goals, with a penalty of
    forfeiting money if they fail.

    The site was launched to the public in January 2008. As of June 2010, stickK had more than
    60,000 users.

    About 80% of stickK contracts focused on weight loss or fitness, with significant New Year
    growth from media coverage. A June 2010 partnership with the American Cancer Society
    added over 10,000 members.

    By 2010, over 30% of Americans were obese, linked to processed foods and sedentary
    lifestyles, causing health issues like heart disease, diabetes, and depression.

    Obesity-related public health costs were estimated at $150 billion annually. Governments and
    businesses initiated projects like posting calorie counts in restaurants to promote healthy
    eating.

    They used behavioural economics via commitment contracts to enhance motivation and help
    people adhere to their goals despite temptations.
    Why stickK Worked Key Competitors
    BEHAVIORAL ECONOMICS SparkPeople
    PRINCIPLES Had interactive tools & advice for weight loss and
    exercising more. By 2010, had 10M registered members.
    StickK used behavioral economics principles from
    books like "Predictably Irrational" and "Nudge" to
    combat procrastination and impulsive decisions,
    employing commitment contracts and incentives to
    PEERtrainer
    enhance goal achievement. A social networking site offering resources and strategies
    for successful dieting. Had nearly 500K users by 2010.

    Virgin Pulse
    UNIQUE VALUE Part of Richard Branson’s Virgin Empire. By 2010, had
    PROPOSITION more than 100 paid clients.

    stickK differentiated itself by offering binding


    commitment contracts that involved financial
    HealthyWage
    stakes, motivating users to adhere to their goals
    through the threat of financial loss. Organized weight loss challenges and competitions.
    Financially backed by US Government, food companies
    The platform's success rates were enhanced by
    users' ability to choose where forfeited funds would
    go, including to anti-charities, which resonated well Keas
    with users seeking strong motivational incentives. A pure B2B platform creating private social networks for
    its corporate customers’ employees.
    Understanding How stickK Worked
    Setting Stakes Key Competitors
    Referee and Support System
    Users appointed referees who monitored their progress & reported
    Users had the option to wager money on their commitment
    contracts to increase motivation. If they failed, the money was back to stickK. They played a crucial role in validating users' self-
    forfeited. reports.

    The choice of recipients included friends, charities, or anti- Supporters, including friends, family, and professionals, encouraged
    charities, with the latter being the most popular choice among & monitored progress through commitment journals and social
    users. media sharing.

    Goal Setting and Types Payment Policies and Success Rates Social Media and User Engagement
    Users set goals on stickK such as weight loss, Initially, stickK charged users upfront for the entire stake Social media played a vital role in stickK's
    exercise, etc. or achieving personal milestones amount but later switched to charging only if users failed growth, driving many new site visitors.
    like improving relationships. their commitments.
    Users could invite friends directly from stickK to
    Weight loss and fitness goals constituted Contracts with stakes had a significantly higher success support their commitments, leveraging social
    approximately 80% of all goals set on the rate, of around 80%. Contracts involving anti-charities as networks to enhance accountability and
    platform. recipients had the highest success rates. motivation.
    History - How stickK was Born

    Early 2007 Late 2007 2008 - 2010


    Early to Mid-2000s
    Goldberg Joins and stickK Is Born Preparing for Launch Growing and Learning
    Dean Karlan, while studying at Goldberg partnered with a web Dean Karlan, while studying at
    MIT in 2001, used commitment Jordan Goldberg, a Yale School development company to build MIT in 2001, used commitment
    contracts to manage weight loss of Management student, the stickK website and secured contracts to manage weight loss
    with a fellow student. partnered with Karlan and Ayres $1.2 million in angel investment with a fellow student.
    to turn commitment contracts by December 2007.
    In 2006, Karlan, now a Yale into a business idea. In 2006, Karlan, now a Yale
    professor, collaborated with Ian The website entered beta testing professor, collaborated with Ian
    Ayres on commitment contracts Goldberg secured initial funding in December 2007, with Ayres on commitment contracts
    for weight management, with and launched stickK publicly in encouraging participation rates for weight management, with
    Ayres successfully using a January 2008, receiving and financial commitments from Ayres successfully using a
    contract to lose weight. significant media attention. users. contract to lose weight.
    stickK’s New Opportunity: A B2B Platform
    stickK, popular among individuals, began receiving B2B requests by 2009. Early clients like Staples and ACS
    sought customized versions, leading to the creation of private-label sites tailored to corporate needs.

    · STAPLES · AMERICAN CANCER SOCIETY


    PARTNERSHIP (ACS) COLLABORATION

    ·With Staples, stickK pioneered a points-based system, Working with ACS posed complexities, including a non-
    replacing monetary stakes. A successful 90-day time-limited program allowing supporter donations
    program encouraged users to organize their lives with through stickK. The goal was to enhance awareness and
    Staples products, garnering over 2,500 commitments. fundraising for healthy behaviors.

    stickK's revenue model included a startup fee (up to $50,000) for platform development and a
    monthly administration fee ($10,000 to $20,000) based on user numbers. Forecasts aimed at
    securing one new B2B deal every two months.
    Problem Statement

    Whether stickK should focus more on its B2B segment


    and adpat a new model?

    Which model wil have greater impact in


    Which business model would provide a more
    using behavioral economics to empower
    sustainable source of revenue?
    peoplw for self-improvement?
    THANK YOU

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