The Behavioral Design Behind Lemonade

Behavioral Strategist & Author

Samuel Salzer

INTERACTIVE CASE STUDY

Presented by

Applying the EAST framework to understand how Lemonade built their world-class onboarding experience

⏱️ 12 minutes

Habit Weekly Pro

Hi there, my name is Samuel Salzer and through this Habit Weekly PRO case study, I hope to help you uncover the following insights and tools 💡🛠

The EAST Framework 🚀

5.

4.

1.

2.

3.

How Lemonade makes it's call-to-action clear and timely ⏰

How Lemonade makes it feel ridiculously easy to onboard 🕺

How Lemonade makes it attractive to complete their onboarding 😍

How Lemonade could better utilize social influence 👪

Case Study Overview

In the top left, you can keep track of how many behavioral insights you've managed to collect through this interactive case study ⭐️

The EAST Framework 🚀

5.

4.

1.

2.

3.

How Lemonade makes it's call-to-action clear and timely ⏰

How Lemonade makes it feel ridiculously easy to onboard 🕺

How Lemonade makes it attractive to complete their onboarding 😍

How Lemonade could better utilize social influence 👪

Case Study Overview

BEHAVIORAL INSIGHTS COLLECTED

To navigate, you can either use your arrow keys or click at the bottom right of the screen. Alright, ready? Let's go! 🚀

The EAST Framework 🚀

5.

4.

1.

2.

3.

How Lemonade makes it's call-to-action clear and timely ⏰

How Lemonade makes it feel ridiculously easy to onboard 🕺

How Lemonade makes it attractive to complete their onboarding 😍

How Lemonade could better utilize social influence 👪

Case Study Overview

BEHAVIORAL INSIGHTS COLLECTED

Let's first establish; what the heck is Lemonade? 🍋

BEHAVIORAL INSIGHTS COLLECTED

Lemonade offers renters and home insurance "powered by tech and driven by social good". They use AI aimed at giving people a fair price and quicker support. Plus, they want to do social good 💙

BEHAVIORAL INSIGHTS COLLECTED

Lemonade offers renters and home insurance "powered by tech and driven by social good". They claim to have an AI that can give people a fair price and quicker support. Plus, they want to do social good.

Lemonade's business model

Pay claims super fast

A flat fee to run everything

If there's money leftover, give it back to causes.

BEHAVIORAL INSIGHTS COLLECTED

They even claim that their platform is built based on principles of behavioral economics. And you might recognize their Chief Behavioral Officer who has been part of the team since 2016...

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Hey Dan, good to see you 👋

Dan Ariely

Chief Behavioral Officer

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It's safe to say they are a pretty cool company and they've recently taken Wall Street by storm. Their IPO on July 2nd saw their listing price of $29 jump 139% to a closing price of $69.41.

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So let's take a closer look at the behavioral design behind this company and see if they can live up to their great claims 🧐

BEHAVIORAL INSIGHTS COLLECTED

To help us analyze Lemonade's onboarding we'll use the EAST Framework. It follows 4 principles for changing behavior...

The EAST Framework

The EAST Framework was created by the Behavioral Insights Team to organize behavior change tools according to the acronym EAST (Easy, Attractive, Social, and Timely)

IF YOU WANT TO CHANGE A BEHAVIOR, MAKE IT...

EASY

ATTRACTIVE

SOCIAL

TIMELY

BEHAVIORAL INSIGHT #1 ⭐️

BEHAVIORAL INSIGHTS COLLECTED

During this case study, I hope to teach you these principles and help you learn some of their underlying behavior change tools as well.

BEHAVIORAL INSIGHTS COLLECTED

The EAST Framework

The EAST Framework was created by the Behavioral Insights Team to organize behavior change tools according to the acronym EAST (Easy, Attractive, Social, and Timely)

IF YOU WANT TO CHANGE A BEHAVIOR, MAKE IT...

EASY

ATTRACTIVE

SOCIAL

TIMELY

BEHAVIORAL INSIGHT #1 ⭐️

Let's dive straight in, this is Lemonade's landing page.

Pretty good first impression. Actually, what is there not to love about this page from a behavioral design perspective?

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Captivating first line in the header

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Sub-header manages to list main benefits in less than 40 characters. And, also...

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First principle unlock - Make it Timely! 🎉

We'll start at the end of EAST since Lemonade does a wonderful job in using Timely Prompts.

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Make it Timely

For action to happen we need to be prompted. However, we respond differently to prompts depending on when they occur.

For example, we are particularly likely to change our habits during periods of transition — after we move house, get married, have a child or change jobs.

Timing is often overlooked, but it is a crucial component in making a behavior more likely to happen.

BEHAVIORAL INSIGHT #2 ⭐️

BEHAVIOR CHANGE TOOLS (CLICK TO LEARN MORE)

We should prompt people when they are likely to be most receptive - like when first entering a landing page.

The same offer made at different times can have drastically different levels of success. Behavior is generally easier to change when habits are already disrupted, such as around major life events.

Timely Prompts

BEHAVIORAL TOOLS

Deadlines

BEHAVIORAL TOOLS

Consider setting time-limits for taking action. If there is no urgency in taking action, people are likely to delay the action and often forget.

A common version of this that Lemonade likely uses as well are limited offers or deals which forces you to sign up by a specific date.

TIMELY PROMPTS

IF-THEN PLAN

DEADLINES

Help people plan their response to events. Especially when it involves overcoming potential challenges or obstacles - "IF that happens, THEN I'll do this"

There is a substantial gap between intentions and actual behavior. Prompt people to identify the barriers to action, and develop a specific plan to address them.

If-Then Plans

BEHAVIORAL TOOLS

IF-THEN PLAN

DEADLINES

TIMELY PROMPTS

Try click on the buttons for more info on the relevant behavior change tools ⚒️

BEHAVIORAL INSIGHTS COLLECTED

Make it Timely

For action to happen we need to be prompted. However, we respond differently to prompts depending on when they occur.

For example, we are particularly likely to change our habits during periods of transition — after we move house, get married, have a child or change jobs.

Timing is often overlooked, but it is a crucial component in making a behavior more likely to happen.

BEHAVIORAL INSIGHT #2 ⭐️

BEHAVIOR CHANGE TOOLS (CLICK TO LEARN MORE)

We should prompt people when they are likely to be most receptive - like when first entering a landing page.

The same offer made at different times can have drastically different levels of success. Behavior is generally easier to change when habits are already disrupted, such as around major life events.

Timely Prompts

BEHAVIORAL TOOLS

Deadlines

BEHAVIORAL TOOLS

Consider setting time-limits for taking action. If there is no urgency in taking action, people are likely to delay the action and often forget.

A common version of this that Lemonade likely uses as well are limited offers or deals which forces you to sign up by a specific date.

TIMELY PROMPTS

IF-THEN PLAN

DEADLINES

Help people plan their response to events. Especially when it involves overcoming potential challenges or obstacles - "IF that happens, THEN I'll do this"

There is a substantial gap between intentions and actual behavior. Prompt people to identify the barriers to action, and develop a specific plan to address them.

If-Then Plans

BEHAVIORAL TOOLS

IF-THEN PLAN

DEADLINES

TIMELY PROMPTS

Lemonade does this in a beautiful way through their main call-to-action. It really stands out and it's almost impossible not to notice it. Again, this is an example of Timely Prompts ⚒️

Timely Prompts

We should prompt people when they are likely to be most receptive - like when first entering a landing page.

The same offer made at different times can have drastically different levels of success. Behavior is generally easier to change when habits are already disrupted, such as around major life events.

BEHAVIORAL TOOLS

BEHAVIORAL INSIGHTS COLLECTED

Want to take Timely Prompts ⚒️ a step further? Consider during what time in someone's life would they be most likely to be receptive to your message. For example, after they just moved house.

Timely Prompts

We should prompt people when they are likely to be most receptive - like when first entering a landing page.

The same offer made at different times can have drastically different levels of success. Behavior is generally easier to change when habits are already disrupted, such as around major life events.

BEHAVIORAL TOOLS

BEHAVIORAL INSIGHTS COLLECTED

Lemonade's call-to-action also aligns with the user's main goals when it comes to insurance: Saving money.

BEHAVIORAL INSIGHTS COLLECTED

Well, let's now check out what happens when we follow Lemonade's call-to-action!

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Oh, hey Maya 👋 I have no clue who you are, but nice to see a friendly face. I was not expecting that.

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Who would have thought that giving an automated process a smiling face could make a big difference?

**Cough** Don't look at me **Cough**

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While this is a great first screen in its simplicity, I was expecting to see prices straight away, given the call to action.

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"In seconds" sounds quick and and I want to get an awesome price, but it also almost feel too good to be true 🧐 Still, I'm curious to find out - let's go!

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For the sake of this case study,
I thought I'd use my friend's identity here... Again, don't look at me. Just doing this for a "friend" 🤫

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Alright, let's see how well Google Maps cover Gotham City...

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Well, close enough I guess 🤷‍♂️

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Showing the map once I've added the address is a nice touch, removes potential uncertainty.

BEHAVIORAL INSIGHTS COLLECTED

That brings us to the next principle - Make It Easy! 🎉 Lemonade does a great job at this in a few ways...

BEHAVIORAL INSIGHTS COLLECTED

Make it Easy

We know from the behavioral literature and work in practice that small, seemingly irrelevant details that make a task more challenging or effortful (what we call ‘friction costs’) can make the difference between doing something and putting it off. Therefore, the first principle is to consider how to make it easier for someone to do something, be it live more healthily or pay their taxes on time.

BEHAVIORAL INSIGHT #3 ⭐️

BEHAVIOR CHANGE TOOLS (CLICK TO LEARN MORE)

Reduce the ‘hassle factor’ of taking up a service. The effort required to perform an action that seems complicated often puts people off. Reducing the effort required can increase uptake or response rates.

What counts here is perceived effort - how difficult and complicated does people perceive it to be?

Reduce Friction

BEHAVIORAL TOOLS

Defaults

BEHAVIORAL TOOLS

Harness the power of defaults. We have a strong tendency to go with the default or pre-set option, since it is easy to do so. Making an option the default makes it likely to be adopted.

For example, if Lemonade have defaults to include optional add-ons (burglary cover etc) it will likely increase chances of people keeping them.

REDUCE FRICTION

SIMPLIFY MESSAGES

DEFAULTS

Ensure messaging is easy and simple to understand for all users. Making the message clear often results in a significant increase in response rates to communications. In particular, it’s useful to identify how a complex goal can be broken down into simpler, easier actions.

Simplify Messages

BEHAVIORAL TOOLS

SIMPLIFY MESSAGES

DEFAULTS

REDUCE FRICTION

Make it Easy

We know from the behavioral literature and work in practice that small, seemingly irrelevant details that make a task more challenging or effortful (what we call ‘friction costs’) can make the difference between doing something and putting it off. Therefore, the first principle is to consider how to make it easier for someone to do something, be it live more healthily or pay their taxes on time.

BEHAVIORAL INSIGHT #3 ⭐️

BEHAVIOR CHANGE TOOLS (CLICK TO LEARN MORE)

Reduce the ‘hassle factor’ of taking up a service. The effort required to perform an action that seems complicated often puts people off. Reducing the effort required can increase uptake or response rates.

What counts here is perceived effort - how difficult and complicated does people perceive it to be?

Reduce Friction

BEHAVIORAL TOOLS

Defaults

BEHAVIORAL TOOLS

Harness the power of defaults. We have a strong tendency to go with the default or pre-set option, since it is easy to do so. Making an option the default makes it likely to be adopted.

For example, if Lemonade have defaults to include optional add-ons (burglary cover etc) it will likely increase chances of people keeping them.

REDUCE FRICTION

SIMPLIFY MESSAGES

DEFAULTS

Ensure messaging is easy and simple to understand for all users. Making the message clear often results in a significant increase in response rates to communications. In particular, it’s useful to identify how a complex goal can be broken down into simpler, easier actions.

Simplify Messages

BEHAVIORAL TOOLS

SIMPLIFY MESSAGES

DEFAULTS

REDUCE FRICTION

They simpify the onboarding process by breaking it down step-by-step. Each screen only asks the user to do one thing. This reduces the perceived difficulty, an example of Reduce Friction ⚒️

BEHAVIORAL INSIGHTS COLLECTED

The language used is also very easy to understand and sentences are kept short, a good example of Simplify Messages  ⚒️

SIMPLIFY MESSAGES

BEHAVIORAL TOOLS

Ensure messaging is easy and simple to understand for all users. Making the message clear often results in a significant increase in response rates to communications. In particular, it’s useful to identify how a complex goal can be broken down into simpler, easier actions.

BEHAVIORAL INSIGHTS COLLECTED

As we see when we continue, illustrations also helps to simplify the process. At least in most cases – these icons are a bit unclear.

BEHAVIORAL INSIGHTS COLLECTED

The buttons turning pink when each step is completed is a nice touch as an indicator of being ready to continue.

BEHAVIORAL INSIGHTS COLLECTED

My friend tells me Wayne Manor is 42,500 sq feet (4,000 sqm). Being a Wayne clearly has its benefits...

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Oops! Well, I must say this seems fair. Let's enter 4,250 sq. ft. instead.

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These illustrations are so fun! 🤩

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Still, it's a bit sad with this one as my friend has 42,500 sq. ft. to himself. That's a lot of space for one toothbrush...

BEHAVIORAL INSIGHTS COLLECTED

Still, it's a bit sad with this one as my friend has 42,500 sq. ft. to himself. That's a lot of space for one toothbrush...

I got to give it to Lemonade, they've made this onboarding very attractive. Especially using effective ways to attract attention and providing eye-candy 🍬

BEHAVIORAL INSIGHTS COLLECTED

Make it Attractive

There are several ways of making things more attractive. Some of these are relatively intuitive (such as personalizing messages); others are more sophisticated (such as re-framing the way in which incentives are presented). Fundamentally, though, making an action attractive is about two main things: drawing attention to it, and making the action more appealing. We can accomplish this in a few ways, as listed below.

BEHAVIORAL INSIGHT #4 ⭐️

BEHAVIOR CHANGE TOOLS (CLICK TO LEARN MORE)

Making something more salient often increases its chances of changing behavior. We are more likely to do something that our attention is drawn towards. Ways of doing this include the use of images, color or personalization.

Lemonade uses the color pink and illustrations to great effect.

Attract Attention

BEHAVIORAL TOOLS

Rewards

BEHAVIORAL TOOLS

Design rewards and sanctions for maximum effect. Financial incentives are often highly effective, but alternative incentive designs — such as lotteries — also work well and often cost less. Non-monetary rewards are also possible including badges and other forms of recognition and highlighting achievement.

ATTRACT ATTENTION

APPEALING FRAME

REWARDS

APPEALING FRAME

REWARDS

ATTRACT ATTENTION

Consider ways to frame the message to motivate action. This could include many frames, including using scarcity or loss aversion in the framing. "Limited spots available" and "don't miss the chance..." are examples of this. However, these frames can often backfire and many users are becoming wise to these tactics.

Appealing Frame

BEHAVIORAL TOOLS

So, with what we have covered so far, we are at the acronym EAT. Honestly, I'm happy to stay here 😄... But we have one more letter left. Almost there, let's find S!

BEHAVIORAL INSIGHTS COLLECTED

Make it Attractive

There are several ways of making things more attractive. Some of these are relatively intuitive (such as personalizing messages); others are more sophisticated (such as re-framing the way in which incentives are presented). Fundamentally, though, making an action attractive is about two main things: drawing attention to it, and making the action more appealing. We can accomplish this in a few ways, as listed below.

BEHAVIORAL INSIGHT #4 ⭐️

BEHAVIOR CHANGE TOOLS (CLICK TO LEARN MORE)

Making something more salient often increases its chances of changing behavior. We are more likely to do something that our attention is drawn towards. Ways of doing this include the use of images, color or personalization.

Lemonade uses the color pink and illustrations to great effect.

Attract Attention

BEHAVIORAL TOOLS

Rewards

BEHAVIORAL TOOLS

Design rewards and sanctions for maximum effect. Financial incentives are often highly effective, but alternative incentive designs — such as lotteries — also work well and often cost less. Non-monetary rewards are also possible including badges and other forms of recognition and highlighting achievement.

ATTRACT ATTENTION

APPEALING FRAME

REWARDS

APPEALING FRAME

REWARDS

ATTRACT ATTENTION

Consider ways to frame the message to motivate action. This could include many frames, including using scarcity or loss aversion in the framing. "Limited spots available" and "don't miss the chance..." are examples of this. However, these frames can often backfire and many users are becoming wise to these tactics.

Appealing Frame

BEHAVIORAL TOOLS

Hmm. This is honestly a tricky question. I'd assume "superb" for Wayne Manor, but I'm unsure 🤔

Oh! Very helpful and timely, Maya. Thanks! Another great example of reducing hassle factors 👏

Finally 🙏 I didn't plan to share my.. ehm, I mean my friend's email. But I've invested too much time in this to leave now...

Quick quiz! What is this tendency of finding it difficult to stop when we've invested time or money in something? Make your choice 🤓

How did you go with that one? The correct answer was the Sunk Cost Fallacy.

Here you can see how other people answered.

Alright, email entered! Still, this onboarding definitely took more than "a few seconds". Looks like you overpromised, Maya! 😉

I expect that most people wouldn't be too upset about this, especially given that the onboarding is so pleasant. Still, we should be careful not to over-promise if we hope to build long-term trust.

Anyway, my expectations are high now. I better be in for a sweet deal...

Alright, $207 per month. I guess that's a decent price. But is it an awesome price? I don't know. Say I had no previous house insurance to compare with, how would I know?