A behavioral economics concept where people categorize and treat money differently depending on its source or intended use. Crucial for understanding financial behavior and designing systems that align with users' mental accounting practices.
The tendency for individuals to continue a behavior or endeavor as a result of previously invested resources (time, money, or effort) rather than future potential benefits. Important for understanding decision-making biases and designing systems that help users avoid irrational persistence.
Return on Investment (ROI) is a performance measure used to evaluate the efficiency or profitability of an investment or compare the efficiency of different investments. Crucial for assessing the financial effectiveness of business decisions, projects, or initiatives.
Recency, Frequency, Monetary (RFM) analysis is a marketing technique used to evaluate and segment customers based on their purchasing behavior. Essential for targeting high-value customers and optimizing marketing strategies.