For quite some time now I have
been involved in bringing behavioral science into practice and the beauty of
this (still emerging) field is its diversity. In essence, behavioral science is
about understanding how we really think (make judgments and decisions) and what
influences what we do. The practical applications of behavioral science are
hugely diverse: it is applied in public policy, in marketing and connected
fields such as advertising, market research retail design etc., in product and
service design, in the financial sector etc. Recently I was invited to take
part in a workshop on applying behavioral science in fisheries.
So it’s not exactly farfetched to
claim that Behavioral Science can be applied in any field where there is a human
component.
There is, however, another
dimension of diversity in applications of behavioral science other than the
area of application. This is the depth of incorporating behavioral science into
an activity.
Tricks
Not seldom I was asked to present
some “cool tricks” of behavioral science that can be used in field X. I’m seriously against seeing the
applications of behavioral science as “tricks” and usually respond with the
following phrase:
“Tricks is what is done in the red
lights district in Amsterdam. I am applying (behavioral) science, which is a bit different…”
Although I am against seeing
applied behavioral science as a “bag of tricks”, the reality is that many
companies and organizations want just a magical silver bullet to solve (almost)
all their problems and to brag about how they are “trendy” and “at the cutting edge of best practices”.
The truth is that, quite often,
applying patches (read “tricks”) is the only thing that can be done … at least at
the moment.
One very good example is that of traffic
fines. Thanks to the Behavioral Insights Team (UK) aka. The Nudge Unit, there
is some solid knowledge on what can be done to increase the rate of people
paying their traffic fines. Simple changes such as replacing “amount owed: …”
with “you owe …” leads to an increase in the voluntary compliance (read actually
pay the fine).
This approach, however, doesn’t go
very deep into solving the real problem which is traffic safety. But more on
that later.
When faced with “tricks”, people
say:
“That’s cool”
“That’s cool”
Cheats
Behavioral science can sometimes be
used to create cheats so that a company
(organization) gets X Euros extra from the clients’ pockets (bank account).
This is not illegitimate. After
all, in a market economy, companies try to maximize what they sell. And for all
people who are uncomfortable with this, they should know that once you are in a
shop, on a website etc. the organization that owns it will try to do anything
possible (and legal) to squeeze as much cash out of you as it can.
Coming back to behavioral cheats,
they refer to applications of behavioral science that are aimed at harnessing the
ambiguity people face more often than they are willing to admit and at
exploiting some of our cognitive shortcomings.
Here are some general examples of
behavioral Cheats.
The use of anchoring effects in
retail settings such as during a sales promotion, one client can buy maximum 8
items (when people don’t usually buy more than 2).
Diffusing the scent of freshly
cooked food in supermarkets so that clients get hungry and buy more (of
everything, not just food items).
The use of scarcity in on-line
retailing such as “We have only one room left” (by the way The Dutch
advertising standards authority concluded that booking.com is misleading by
using this phrase. Details here)
The use of default opt-ins for
buying travel insurance along with a flight ticket (yes, it’s about Ryanair)…
this practice was banned by the EU Regulation, thankfully.
These behaviorally informed
cheats are, for sure, controversial and to some extent subject of public and
regulatory scrutiny. However, most of them are no illegal and they are simply
part of the arsenal of XXIst century marketing.
When faced with “cheats”, people
say:
“They tricked me (again)”
“They tricked me (again)”
True Value Interventions
Cheats and (sometimes) Tricks are
quite often controversial and they give applied behavioral science a not so nice
image. However, Behavioral Science is a real gold-mine for creating true value,
especially when combined with service design.
Mixing behavioral science with
service design involves the use of Tricks and occasionally Cheats, but it goes
far beyond applying some patches here and there.
When used in developing products
and services (may them be public services), behavioral science will lead to the
creation of true value. Let’s go back to traffic safety. The use of some
behaviorally informed tricks to increase voluntary compliance in paying traffic
fines is more than welcomed. Whether we like it or not, fines are part of the
game of traffic safety. The application of behavioral science in this area can
go further. One possible path is to increase the pain of paying associated with
paying fines by making the payment more salient. This, however, is a
superficial application of behavioral insights since it doesn’t go beyond the
use of “sticks”.
Another path of applying
behavioral science in traffic safety is applying a Nudge approach to slowing
down drivers in risk areas. One way of doing so is the use of speed cameras
which display the speed of a car and showing a happy or a sad face depending on
whether the driver is going below or above the speed limit.
Another path of applying
behavioral science in traffic safety is creating a behaviorally informed
incentive system for young (male) drivers to be prudent. This would consist of
returning a part of the (quite high) insurance premium if they don’t have
traffic penalties (including accidents) within a certain year. Moreover, this
refund can take the form of emotionally valuable products such as a Metallica
concert ticket (though I’m not sure than today’s youth appreciate Metallica).
At least for this author, a Metallica concert ticket is more valuable than 100
Euros (even if that is the price of the ticket).
Behavioral science can be applied
in private sector services as well. Not long ago I was asked by a bank to
suggest some behaviorally informed interventions to help the bank’s clients
better manage their budget. In The Netherlands most essential expenses (rent /
mortgage, health insurance, utilities etc.) are fixed monthly payments done
through direct debit on the first day of each month. However, most people
receive their salaries around the 25th of the month. My suggestion
was to reframe the information on the clients’ account balance between the day
of receiving the salary and the day of monthly fixed payments. So instead of
seeing on the 26th a balance of 2050 €, the client would see 1150 € +
900 € for your fixed monthly expenses.
Another suggestion for clients
who have more serious issues with managing their budget (and subsequently
meeting their loan reimbursements) was to design a “self-control support”
mechanism. One feature was for each client to set some categories where they
would like to cut down expenses (say liquor) and whenever the person would
enter a liquor-shop their phone to display a moral reminder such as “your
daughter needs new sport shoes for school”. (Yes, it is technically possible to
do this, at least in The Netherlands).
To some (naïve) eyes, the
examples above may not seem more than just tricks and cheats, but there is a
huge difference. Although reframing the information about one’s bank account
balance or using moral reminders to avoid impulse purchases seem trivial and
even farfetched, they are neither tricks nor cheats. The behavioral science insights
are incorporated at the service/ product design level and they are centered on
a problem that needs to be dealt with.
When faced with “True Value
Interventions”, people say:
“What a cool feature. I’m glad they did that! ”
“What a cool feature. I’m glad they did that! ”
To summarize this already too
long post:
When faced with “tricks”, people
say: “That’s cool”
When faced with “cheats”, people
say: “They tricked me (again)”
When faced with “True Value
Interventions”, people say: “What a cool feature. I’m glad they did that! ”
Of course, there is a good chance
that a lot of people will not even notice the Tricks, Cheats and True Value
interventions. After all, fish don’t notice the water…
No comments:
Post a Comment