Decision Theory
The study of how individuals make choices among alternatives and the principles that guide these choices. Important for designing decision-making processes and interfaces that help users make informed choices.
29 topics found for:
“optimal choice”
Smart Defaults
Pre-set options in a system that are designed to benefit users by simplifying decisions and guiding them towards the best choices. Essential for improving user experience and ensuring that users make optimal decisions with minimal effort.
Design Tradeoffs
The compromises made between different design options, balancing various factors like usability, aesthetics, and functionality. Essential for making informed decisions that optimize overall design effectiveness.
Goldilocks Effect
The psychological phenomenon where people prefer options that are not too extreme, but just right. Crucial for designing products and experiences that cater to the majority preference.
Decoy Pricing
A strategy where an additional, less attractive option is introduced to make other pricing options look more appealing, often steering customers towards a particular choice. Important for guiding user decisions and increasing the perceived value of targeted pricing tiers.
Mid-Tier Value
A pricing strategy that offers a middle option with substantial value at a moderate price, often perceived as the best deal by users. Useful for driving sales by presenting a balanced choice that appears more attractive relative to higher and lower-priced options.
Decoy Effect
A cognitive bias where consumers change their preference between two options when presented with a third, less attractive option. Useful for designers to create choice architectures that effectively influence user decisions.
Hick’s Law
A principle that states the time it takes to make a decision increases with the number and complexity of choices available. Crucial for designing user interfaces that minimize cognitive load and enhance decision-making efficiency.
Overchoice
The phenomenon where having too many options leads to decision-making paralysis and decreased satisfaction. Crucial for understanding and designing user interfaces that avoid overwhelming users with choices.
Take the Best Heuristic
A decision-making rule where individuals choose the option with the highest perceived value based on the first good reason that comes to mind, ignoring other information. Crucial for understanding and designing for quick decision-making processes.
Histogram
A graphical representation of the distribution of numerical data, typically showing the frequency of data points in successive intervals. Important for analyzing and interpreting data distributions, aiding in decision-making and optimization in product design.
Decision Architecture
The design of environments in which people make decisions, influencing their choices and behaviors. Important for creating user experiences that guide decision-making processes effectively.
Sales Metrics
Data points that represent an individual's, team's, or company's performance in the sales process. Essential for tracking progress, identifying issues, and optimizing sales strategies.
Monte Carlo Simulation
A statistical technique that uses random sampling and statistical modeling to estimate mathematical functions and simulate systems. Useful for risk assessment, decision-making, and performance optimization in digital product design.
Expected Utility Theory
A theory in economics that models how rational individuals make decisions under risk by maximizing the expected utility of their choices. Essential for understanding decision-making under risk.
Sludge
Any process or administrative barrier that unnecessarily complicates transactions and creates friction, discouraging beneficial behaviors. Important for identifying and eliminating unnecessary obstacles that hinder user experiences.
Satisficing
A decision-making strategy that involves choosing an option that meets the minimum requirements rather than seeking the optimal solution, balancing effort and outcome. Important for designing user experiences that accommodate decision-making under constraints.
Opportunity Cost Neglect
A cognitive bias where individuals overlook or underestimate the cost of opportunities they forego when making decisions. Crucial for understanding user decision-making behavior and designing systems that highlight opportunity costs.
Data-Driven Design
An approach to design that relies on data and analytics to inform decisions and measure success. Crucial for making informed design decisions that are backed by evidence.
ZMOT
Zero Moment of Truth (ZMOT) is a concept in marketing that refers to the point in the buying cycle when the consumer researches a product before the seller even knows they exist. Crucial for understanding consumer behavior and optimizing marketing strategies to influence decision-making at this early stage.
Less Is Better Effect
A cognitive bias where people prefer a smaller set of higher-quality options over a larger set with lower overall quality. Useful for designing product offerings and experiences that emphasize quality over quantity for users.
Bounded Rationality
A concept that humans make decisions within the limits of their knowledge, cognitive capacity, and available time, leading to satisficing rather than optimal solutions. Crucial for designing systems and processes that account for human cognitive limitations and decision-making processes.
Dual Process Theory
A framework suggesting there are two systems of thinking: System 1 (fast, automatic) and System 2 (slow, deliberate), influencing decision-making and behavior. Crucial for understanding how users process information and make decisions.
Data Distribution
The spread and pattern of data values in a dataset, often visualized through graphs or statistical measures. Critical for understanding the characteristics of data and informing appropriate analysis techniques in digital product development.
Critical Thinking
The objective analysis and evaluation of an issue in order to form a judgment. Essential for making informed and rational design decisions.
Weighted Scoring
A prioritization method that assigns different weights to criteria based on their importance, helping to make informed decisions and prioritize tasks effectively. Crucial for making objective and balanced decisions in project management and product development.
Pseudo Set Framing
The cognitive bias where people treat a set of items as more significant when they are perceived as a cohesive group. Important for understanding user perception and decision-making.
Placing Bets
A strategic approach where multiple potential solutions are tested to identify the most promising one. Crucial for innovation and reducing risk in decision-making.
Naive Allocation
A heuristic where individuals evenly distribute resources across all options, regardless of their specific needs or potential. Useful for understanding and designing around simplistic decision-making strategies.