The Self-Defeating Fight against Vaccination Refusal

In reaction to the persisting decrease of vaccination rates in developed countries, public authorities, the media and non-profits counteract with information campaigns. In my opinion, this approach is self-defeating because it ignores the phenomenon’s behavioral realities.

1. Raising awareness is typical for information campaigns.

Articles with headlines such as Wealthy L.A. Schools' Vaccination Rates Are as Low as South Sudan's are well intended, but ignore the effect of social proof. When unsure what to do, people use others’ behaviors as cues for their own behavior. When faced with information on the increasing number of parents who refuse vaccination, others might interpret the message as: it’s OK not to vaccinate your children since others are doing this.

In many developed countries the overall situation is not as dramatic as some headlines indicate. The ideal vaccination rate is 95%+ which ensures herd immunity. The actual vaccination rates are somewhere in the 80-90% range. Healthcare professionals are worried mainly because of the trend and because of the real danger of losing the herd immunity.  As I understand the societal benefits of vaccination are not linear. Simply put, the societal benefit of improving vaccination rates from 80% to 85% is smaller than getting it from 90% to 95% (where heard immunity is achieved).

While from an epidemiological point of view a vaccination rate of 80% is worrisome news, from a behavioral science perspective things aren’t as dramatic. While most news focus on the increasing number of children who are not vaccinated, the upside is that the very large majority of children (in the USA) are vaccinated.

Saying that 20% of children are not vaccinated can be reframed as 80% are getting vaccines!   

In other similar situations, this type of simple reframing proved extremely effective in achieving behavioral change. Just as an example, many people have no problem buying a ham that is 97% fat free, but they would be very reluctant to purchase ham that is 3% pure fat.

Couple this reframing with social proof and you have a nice tool for reaching the goal of increasing vaccination rates.

Whereas headlines need to be dramatic in order to get clicks (or sell newspapers), public information campaigns need to be effective in achieving behavioral change – in this case get more children vaccinated.

Instead of relying on alarmist messages, why not simply say that the great majority (80%) of parents (in USA) do vaccinate their children.

Social proof and reframing of information can be used in even less favorable circumstances. A few months ago, I heard on the radio a commercial aimed at increasing the flu-vaccination rate. Unfortunately, the commercial said something like: “If you are one of the 65% of Americans who don’t get the shot, you can get the flu”.

Beyond the obvious errors in communication (from a behavioral science perspective), the reality of the numbers seems discouraging. When only (approx.) 35% of people get a vaccine, it is hard to leverage social proof – the great majority of people is not doing what is desired.

There is, however, a silver lining: 35% of the US population (311 million) is roughly 100 million people. Very likely, saying that over 100 million people (fellow Americans) get the flu shot is more convincing than 65% of Americans don’t get the flu shot.

   

2. Doctors are spokespeople in pro-vaccination campaigns.

The use of medical doctors as authority figures (recommenders) in communication has a long history. Doctors (or actors dressed as doctors) have recommended anything from detergent to cigarettes and from pharmaceutic drugs to diets.

While in many commercials using medical doctors as recommenders proved to increase the communication’s effectiveness, in the case of pro-vaccination (or anti anti-vaccination) campaigns is not exactly appropriate.  

Doctors’ presence and messages are reassuring for people who favor vaccination. However, those who are reluctant to vaccination don’t perceive doctors as authority figures, thus the message’s impact is severely diminished.

Simply put, in the eyes of (some) people who refuse vaccination, regular medicine is not trustworthy and so are medical doctors. Maybe herbalists, alternative healers etc. would be more credible.  

3. The rational message favoring vaccination is inadequate for tackling highly-emotional (false) concerns.

Strongly related to using medical doctors as advocates for vaccination is the messaging of pro-vaccination endeavors. Doctors dressed in their uniforms speak about the scientifically proven benefits of vaccination and talk about the serious dangers of not using this simple and effective prevention tool.

Although correct, this rational message is highly ineffective for those who oppose vaccination. Many anti-vaccination arguments have a high emotional load. Nobody (falsely) claims vaccines to cause kidney-failure – a serious condition with a low emotional load / fear-factor. Yet, all anti-vaccination advocates mention that vaccines can cause autism – a condition that has a high emotional component or fear-factor. By the way, vaccines don’t cause autism, but at one point someone made a false claim they did and the research has been proven to rely on faked data and the paper was later retracted. Yet, the legacy of fear left by that paper stands.

4. Vaccination’s benefits are Non-Events & the Availability Heuristic

The benefit of vaccination is very difficult to observe because it is a non-event – something that doesn’t happen. We humans are terrible at understanding non-events and in the case of vaccination things are even worse than in other situations.

Taking a step side-ways, I think we can all agree that a fire-fighter who goes into a burning building and saves a person (or cute puppy) is a hero worthy of public praise.

At the same time, the huge majority ignores other people who (indirectly) save many more lives from fires – the fire-safety inspectors: The bureaucrats who come with checklists and regulations, who generally are grumpy and somehow annoying because they keep insisting on even small features of compliance to fire-safety regulations.

These people save lives not by entering burning buildings, but by ensuring the conditions to prevent fires altogether and / or decrease the damage caused by fires.

The vaccination situation is somehow similar. Preventing a disease is not the same with curing one. A doctor who cured a patient with smallpox will receive many thankyou notes and will be held in high regard, but the nurse who gave thousands of anti-smallpox vaccines, thus preventing the disease, is still anonymous.

Earlier I mentioned that the situation is somehow similar. The high effectiveness of mass vaccination in preventing diseases, in fact, makes it more difficult to see the benefits of vaccination.

Let’s go back to the firefighter – fire-safety inspector illustration. The (paradoxical) reason for complying with fire-safety regulation is that there are enough (?!) fires to make the danger salient in our minds. Either in real life or in movies, fires are frequent enough to remind us that preventive action is needed.

In the case of vaccination things are a bit different. In developed countries recent cases of smallpox, poliomyelitis etc. are extremely rare. Mass vaccination led to having two-three generations free of such diseases and their devastating consequences. While during our (great-) grandparents’ childhood it was common for families to lose one or more children to diseases such as poliomyelitis, nowadays such instances are (almost) inexistent.

This is when the availability heuristic comes into play and distorts decision making on accepting vaccination.

The availability heuristic means that we judge the probability of an event based on the salience and frequency of memories of that event. We know of a lot of killings by firearms and very few suicides by guns, thus we perceive that there are more killings than suicides by firearms. The reality, however, is different: there are more suicides than killings by guns (at least in the US).

Because instances of terrible diseases that are prevented by vaccines are extremely rare and inconspicuous, we erroneously perceive the risk of not vaccinating a lot smaller than it actually is.

Here’s where movie makers can lend a hand. Instead (alongside) of scaring people with terrorist plots, doomsday scenarios etc. they could include more instances of people suffering and dying from poliomyelitis, smallpox etc.

5. Costs are in the present and benefits are in the future

   

Most people prefer 100$ now over 110$ in one year from now. This is an illustration of a psychological phenomenon called discounting future outcomes.

Vaccinations’ (non-event) benefits occur in the future (1-20 years) and, subsequently, are discounted in the present. The discomforts of vaccination– parents have to take their child to the clinic to get the shot, normal minor side-effects (fever, local swelling etc.) – are in the present.

The false dangers of vaccination allegedly occur very soon after getting the shot (in the present, not in the distant future).  

While it is impossible to change the nature of non-events and to eliminate the discounting of future outcomes, there are several things that can be done.

First, to tackle time discounting we can bring the benefits in the present. Naturally, vaccination’s benefits cannot be brought in the present (more so since they are non-events), but decreasing costs (hassle) in the present could be a great approach. In addition, although it might seem unethical, we could offer incentives in the present for getting vaccinated.

Second, to tackle the issue of non-events, we could try to make the immediate benefit more concrete by offering tangible rewards. As mentioned earlier, we could increase the frequency and salience of the dangers of non-vaccination and movies are the best way (at least in my view).

Workshops & Seminars on Using Behavioral Science in Health & Wellness  

 

Do I Really Need a Financial Incentive to Recommend a Service / Product?

Shortly after my wife and I moved to the USA, I noticed an announcement in the apartment building we live in that said: “recommend a friend to move here and you get 250$ when they sign the rental contract” (citing from memory). From an economic point of view this made perfect sense: you bring a client to a business and you get something in return.

Only later I realized that this type of incentive made sense when I saw it simply because, at the time, we barely knew anyone on this side of the Atlantic. A few months later, two former colleagues from Erasmus University moved from The Netherlands to the Washington DC area and they were looking for a place to live. We wanted to help them and showed them around the neighborhood. They were curious about the place we lived in and they came over to our place. To make a long story short, I got a business card from the leasing office of the building and gave them the information. The leasing officer (a very nice lady) mentioned that the offer of 250$ was still valid, so if our “friends” leased an apartment from them, we would get the incentive.

That was the moment when it struck me that this type of incentive scheme was faulty. Although I wouldn’t mind getting 250$, my motivation for recommending the apartment building wasn’t financial. We can pay the rent and I think, considering market conditions, that we get a reasonably good deal. We wanted our former colleagues to enjoy the same price-quality ratio. Moreover, the prospect of getting some cash out of the whole thing made me feel guilty. I truly, deeply hate the multi-level marketing approach. The relationship with our former university colleagues was social, not economical.  In fact, as someone who recently made the move from The Netherlands to the USA, we knew the costs and inconveniences it involved. If anything I would have preferred for our former colleagues to get the 250$.

Our former colleagues picked an apartment in a different neighborhood and the 250$ never left the real-estate company.

A similar case happened with a meal-delivery service we use. At the recommendation of my friend Arjan Haring (from The Netherlands) we tried Hello Fresh – a meal delivery service. In a nutshell, we pay each week 70$ and we receive a box with ingredients for three meals for two. This (type of) service is fantastic for foodies such as myself and my wife. We enjoy cooking and eating new stuff, but aren’t actively looking for new recipes and ingredients.  For our food experience, Hello Fresh is a blessing.

As we were very excited about this service, we talked about it with our few acquaintances in the US. Most of them seemed intrigued and curious about it.

In the first month(s) of using this service, Hello Fresh had an option for existing clients to “give a box” for free. It was an (a)typical approach for bringing in new business based on (existing) customer recommendations.

A bit later, however, they changed this “give a box for free” approach to a split incentive scheme. Basically, if we recommend the service to a “friend” and she subscribes, we get 30$ discount for our next order and the recipient gets 40$ off their first order.

While there is some economic sense in this split benefit approach, I began feeling uncomfortable recommending Hello Fresh. I wouldn’t mind 30$, but the financial incentive doesn’t match my motivation for recommending the service.

I recommend something because I want others to enjoy the service we think is great, not to make money out of it.

While in the case of Hello Fresh there might be some evidence-based reason for changing the approach to generate leads from existing clients from “give a free box” to split-benefit, there’s a big lesson to learn, particularly for marketers.

If you want to leverage your existing clients’ social relationships for your business, you need to understand their nature: SOCIAL.

Most people make a reasonably good distinction between social norms and market norms. The element that makes multi-level marketing utterly disgusting is that it perverts social relationships into (wannabe) market / business relationships.

Social relationships are based on imitation, reciprocity, status and alliances. Once you understand this, you can properly leverage them for your business’ benefit.

Simply put, if you want me to recommend your service to a friend (acquaintance, colleague etc.) help me enhance my social relationship with her/him. If you allow me to make a gift in the form of a discount, voucher or even allow me to offer them a full experience for FREE, that makes me look good, gain reputation etc. with the person with whom I am having a social relationship. This gain in strengthening my social status or relationship with someone I know (well) is, for me, more valuable than (the relatively small amount of) money you are offering as an incentive.

Marketing & Behavioral Science: www.naumof.com 

Is Overconfidence Bias All that Bad?

A while back Daniel Kahneman said in an interview that if he would have a Magic Wand he would eliminate overconfidence.

The article further elaborates on what Kahneman means: “Overconfidence: the kind of optimism that leads governments to believe that wars are quickly winnable and capital projects will come in on budget despite statistics predicting exactly the opposite.”

Source: Daniel Kahneman: ‘What would Ieliminate if I had a magic wand? Overconfidence’ 

Probably the best known example of overconfidence is that of newlywed couples who, very close to the time of getting married, unanimously say that their chances of getting divorced are zero. This, despite the statistical fact that around 50% of marriages end in divorce. If I’m not mistaken, even people who get married for the second time exhibit a similar overconfidence bias.

Without challenging the great Kahneman, I wonder if there isn’t a good (evolutionary) reason for why we’re all affected by overconfidence.

It goes without saying that the prediction: the war will be over by Christmas was wrong for both World War I and World War II. Naturally overestimating one chances of success when starting a war is detrimental – one starts a war.

However, there are lots of benign cases of overconfidence bias that have some positive impact, at least at a higher societal level.

Coming back to marriages: if, at the time of the wedding, we wouldn’t be overconfident about our marriages’ chances of success, we might never do it… and this includes those whose marriages last.

Having children is another case of overconfidence and is strongly correlated to marriage. Whether married or not, future parents underestimate the hassles they will face.

Overconfidence among (wannabe) entrepreneurs is widely known. Every entrepreneur believes she or he will bring to the world the next major business, paradigm-shifting tech product etc.

The statistical reality, however, is a lot more down to Earth. Most new businesses fail and the chance of creating the next big business is in the same order of magnitude of winning the lottery.

However, trying to start a new business brings some benefits at both societal and individual level. In order for a new business to benefit its owners it doesn’t have to be the Next Big Thing. In order for it to benefit society, it can be even a small business that works reasonably well.

With the risk of using myself as an example, when I started my first business (after successfully setting-up a student non-profit), I was wondering: How can I fail? and I got more than one answer. My first business endeavor was an utter failure. But after a while, I tried again in a different area of business and after about a year I managed to find a business model that worked (at least for a couple of years).

Without starting that first, doomed to fail business, I would have never started the one that finally worked.   

There’s a Romanian saying that would translate to English as:

You entered the game, now play.

I believe overconfidence has the role of Getting us into the Game; of getting our behinds off the couch and doing something. Even if that initial something doesn’t work, we’re in the game and we have to play, so we are forced to figure out how to manage.

I believe many people get married due to love and, of course, overconfidence. Naturally things don’t go as in the ideal scenario, but this makes us figure out ways in which we can make things work.

Many people start a business that doesn’t go as they dreamed (overconfidence strikes again), but at least some will try to figure out what and how can work. Maybe some entrepreneurs start as (delusional) dreamers who believe that they will bring The Next Big Thing, but end up having a reasonable small business that provides them with an income and pays a few employees.

I believe overconfidence plays a huge role in getting us to begin doing things. Some will end up in failure, but others will get done and will be useful. 

Behavioral Science Meets Marketing Communication and UX Design

On September 21^st I gave two workshop sessions on how behavioral science can improve marketing communication and UX design, respectively.

I very much enjoyed giving the two half-a-day workshops to the very nice audience at LiveHealthier – a corporate wellness company just North of Washington DC. Both workshops were well received by the audience in both enjoyment of the sessions and usefulness.

Here’s what Amy Troop SVP, Consumer Experience at LiveHealthier said about the training:

Nick Naumof conducted two sessions for our consumer marketing and product development teams on applying the theories of behavioral science to marketing communications and UX design.

Participants found it to be time well spent and came away with immediate applications for the learnings in their day-to-day work.

Thanks, Nick, for all your efforts in crafting a meaningful program for our team!

Thank you Amy, Demetrius and Sasha for the great support in organizing this session! Thank you to all participants who made the day delightful.

Here you can find details on my Learning Programs on how behavioral science and behavioral design can make your products & services work with human nature.

You can take a look at my dedicated programs on behavioral design for banking  and health & wellness.

Nudging Rich and Nudging Poor

In the very short time since I moved to the USA, I was fortunate enough to have met a gentleman who works (worked) at the World Bank in research and applications of behavioural economics in development policies. It was very fortunate since we met because he was selling a car and my wife and I were buying one.

While we were waiting for the car to be inspected by a mechanic we had a wonderful chat on behavioural science and its applications. We shared perspectives, points of view, experiences and illustrations of behaviourally informed interventions.

For me this short chat was an eye opener on the differences in Nudging across countries.

When it comes to differences across countries, the first thing that comes to mind is Culture and subsequently, Cultural Differences.

Culture, however, is not the (main) cause for the differences that exist in applying behavioural science in rich and poor countries. (I’m oversimplifying, I know). The main cause is the (invisible) infrastructure that exists in rich countries and, quite often, lacks in poor ones.

In the Western World we have infrastructure that we take for granted and, to some extent, we have become blind when it comes to it. Many western-world nudges and behavioural design features are built on this (seemingly) invisible infrastructure.

The example of the Fly in the Urinal  nudge (Featured in the book Nudge and detailed in this article), it is a wonderful illustration on the how western-world nudges are built on the western-world infrastructure.

The Fly in the Urinal intervention is aimed at tackling a sanitation / health problem – spillage of urine in public toilets.

As you can imagine, sanitation and subsequent health related problems are not specific to the western world; such problems are present everywhere and the western world is (maybe) the least affected by them.

What is essential here is that the Fly in the Urinal intervention assumes that there is a sewerage system.

I know this sounds weird, but it is true. Moreover, I have to admit that I have never thought about this underlying pre-condition of the fly in the urinal intervention. I guess I’m not the only westerner Behavioural science guy who has taken this for granted.

Whereas for westerners the presence of sewerage systems is natural, according to the World Bank Report 2015,

 About one billion people defecate in the open. (see page 17)

For this behavioural problem which brings health problems, flies (in the urinal) will not work. (Flies will appear naturally, but they will only worsen the problem).

The design of behavioural interventions definitely is context dependent and infrastructure might play a bigger role than culture.

Behavioural science is a gold mine for service design and customer experience – Interview with Nicolae Naumof on Adrian Swinscoe’s blog

Two weeks ago I gave this interview for Adrian Swinscoe’s blog. In it I explain my view on applying behavioural science in service design.

Naturally, I speak on what is behavioural science, what drives human behaviour and plead for a simple, two steps approach on applying behavioural science in service design: (1) Use the scientific literature on human behaviour to come up with behaviourally informed interventions and (2) test them, because no one knows the (absolutely) correct answer.

Interview can be listened here (30 mins or so): - open in new tab ;)

Interview and full transcript on: Adrian Swinscoe’s blog 

In a gold mine, you will not find gold bars …

More on applying behavioural science in service design www.Naumof.com

Behavioural (Service) Design Is About Technology as Much as Rembrandt’s Paintings Are About Canvases and Paints

We are going to make / made a great app that does this and that.

We are building a website that will help people with….

Our new device will enable people to….

These are phrases that are encountered at many conferences, meetings, tradeshows, get-togethers on service design.

A huge proportion of people who (claim to) do service design or customer experience focus their work and their speech on the technology they are working on and how great and mesmerizing it will be for their consumers / users.

Naturally, the ground-breaking, paradigm-shifting technology will enable organizations to be consumer / customer centric…

Although I am allergic to buzz-words, I think that the big issue is not the use of fluffy words that everyone pretends to understand.

The big issue is the over-emphasis on technology.

Good (profitable) service and great experience are as much about technology as Rembrandt’s paintings are about the canvases and paints.  

Source of picture  

It’s obvious that without paints and canvases any painter, including the great Rembrandt, would not be able to create a masterpiece. Nonetheless, good painters draw very beautiful sketches with just a piece of paper and a pencil. It's the same with technology and great service. One can have good service without too much technology being involved.

Even in the case of Service Masterpieces, technology is simply a tool.

It’s about giving a good feeling not about how you do it.

For example, a restaurant stores the phone numbers of frequent (loyal?) clients and when one of them calls to make a reservation, the receptionist answers with “Good day Mr. X, how many will you be this evening?” instead of the typical “Good day, restaurant R, how may I help you?”.

The increase in customer satisfaction with the experience of making a restaurant reservation is not due to some fancy technology (caller ID to be precise). Rather it is because someone (apparently) knows him and (apparently) cares about who he is.

Technology is, not seldom, overused while disregarding the human component.

For example, there are some elevators which have the control buttons on the outside.

Source of picture

Basically, when you call the elevator, you have to type the number of the floor you are going to. The elevator arrives and you enter into it. The doors close and it takes you to where you commanded it when you were on the outside.

I am sure that there is a good reason for this; it might be energy use optimisation.

However, the designers forgot to take into account a very basic human feeling and need.

Once you enter the elevator, you are in a closed small metal box without any control.

That’s pretty freaking, right?

Where the buttons are placed might not influence too much the technology part, but having the buttons on the inside gives you a sense of control. It’s the person who controls the machine and not the machine controlling the person.

We see the technology, but we don’t see the fundamental human truth.

More than 80% of information acquired by humans is received through the visual sense. Our vision is pretty amazing and we rely on it.

There is a draw-back of human vision:

Human vision is great at seeing what is in front of our eyes, but it is horrible at seeing what is behind the salient (shiny) object.

Several years ago, a technology company (with a fruit name) began selling mobile technology devices. There was and still is a lot of buzz around this company and its products. Recently, this company reported the highest profit for a quarter in corporate history… and that amount is in the same league with the GDP of small countries.

Hundreds of business and technology analysts commented on the success of the company and its products. The emphasis, naturally, was on technology and the products’ features: touch screens, apps, memory capacity etc.

Yet, I haven’t heard anyone speaking about the fundamental reason behind this company’s tremendous success. This reason is not technology; rather it is a fundamental human truth.

Without going too much in the depths of evolutionary psychology, the fundamental truth is that all humans have a need to communicate (advertise) themselves on the social and mating market(s).

This is true for other creatures as well, but there is an essential difference between humans and other creatures. Whereas many animals advertise their mating value through conspicuous and costly features such as the peacock’s tail, humans advertise their mating (and social) value through behaviours and ornaments.

In a nutshell, the company mentioned above managed to create and sell peacock tails… It was not the first one to do so, but it managed to become an icon of self-advertising. The most interesting thing is that this company manages to create (and sell) peacock tails that are self-degradable, thus creating the conditions for re-purchase every (other) year.

Whenever a new generation of the product is launched, both the company and its clients talk about the technology progress and the new features, but this is only the surface…

The fundamental truth is that

An “i Peacock’s Tail 5” is sexier than an “i Peacock’s Tail 4”

Happier Customers & Higher Profitability through

Behavioural Science Applied in Service Design

www.naumof.com

Salt & Pepper Choice Architecture

Last year (2014) I had the largest number of flights in my life. Alongside the convenience of fast traveling, flights come with several inconveniences, one of them being in-flight food.

In-flight food can range from (almost) terrible – KLM – to quite good – Tarom – to surprisingly good (for flight food) – Turkish Airlines.

One of the reasons for in-flight food being not exactly a treat is the airlines’ need to cut costs. And this post is a free advice on how airlines can cut costs when it comes to food without damaging the clients’ experience.

Usually, the in-flight food comes with Salt and Pepper in small envelop-like packaging as in the picture below.

While, in our minds, salt and pepper go together very well and are seen more or less as equals, there are some serious differences between them when it comes to prices and use.

You might not realize, but (black, grinded) pepper is more than 79 times more expensive than (white, regular) salt.

According to prices in Albert Heijn (the largest supermarkets chain in The Netherlands), a kilogram of black grinded pepper of the cheapest kind is € 23.80, while a kilogram of regular table salt of the cheapest kind is  € 0.30.

  

When it comes to using salt and pepper, I believe there is a considerable difference. There are a lot more people adding salt to their food than are people who add pepper. It might be just my biased view, but I believe a lot (the huge majority) of the pepper packs are never opened and end up in the trash.

At first glance, this might not look like an issue, but every 200 packs of 5g of pepper thrown in the garbage, are equivalent to throwing 23 euros in the trash. Scale this to millions of passengers each year and things will look very different.  

Just as a note, it would be nice to have some garbology data on this – looking in airplane trash bags and see exactly how much of the pepper ends up unopened in the garbage.

In this light, airlines could simply eliminate pepper from their meals, thus avoiding unwanted waste. But this would damage the experience for the passengers who want pepper in their food.

The solution comes from Choice Architecture.

Instead of providing pepper by default, airlines could make pepper a (free) additional option.  

Here’s a rough prototype on how I see things being solved.

The envelope-like pack of pepper can be replaced by a small piece of paper with the message:

Please ask a flight attendant for pepper.

This change would bring some considerable cost cuts to airlines.

Of course, it would bring some headaches to pepper producers… more on the side-effects of applied behavioural science in a future post.

If you’re curious on how choice architecture can help improve your business, take a look at Designing Decisions.

Re-Design Banking & Insurance

At the end of November in 2014, I gave a session of Re-Design Banking & Insurance seminar to a group of intellectually curious bankers.

It was a very pleasurable experience and I was happy that the participants were open to my (a bit wacky, for banking standards) approach.

One participant said after the seminar:

Nicolae made us think about things we always take for granted.

Another participant said something that made me feel very happy and very proud.  

Nice how he got to the point without bullshitting around it. With every point.

The organizer of the event said about the Re-Design Banking & Insurance seminar I gave:

Nicolae delivered more than promised: content to reflect on, presentation to learn from and takeaways that the group took home to work on right away.

Jeroen Nas

You can take a look at the presentation of Re-Design Banking & Insurance seminar enjoyed by more than 20 intellectually curious bankers here: Re-Design Banking & Insurance seminar.

Applied Behavioural Science the Istanbul Way

At the end of 2014, my beloved wife and I spent six days in Istanbul. Apart from the traditional touristic attractions, which are truly astonishing, I was amazed by the high level of applied behavioural science techniques used by businesses, at least in the touristic area of the city.

Most likely the people who use these techniques have not studied behavioural science. I seriously doubt that many of them even finished high school. Yet, when it comes to deploying sales and marketing techniques rooted in behavioural science, the merchants in Istanbul are better than many people who have studied this beautiful branch of science at Master or PhD level.

Personally, I realized that I could have learned most of what I know by working six months in Istanbul: 2 months in a restaurant, 2 months in a shop and 2 months at the Grand Bazar.

Here are some examples I encountered:

1. Establishing liking and similarity and the use of the Representativeness Heuristic.

Many merchants, including street vendors and restaurants, use the representativeness heuristic in order to choose the language in which they approach people on the street. In my case, I heard lots of people approaching me in Russian. Yes, I do quite look like a prototypical Russian, but I am not.

In addition, a lot of the people whose job is to bring clients from the street, approach passers-by with “My friend”. 

As Cornelia (my wife) said, We never knew how many friends we have there …

Moreover, the majority of merchants speak some very, very basic level of most languages that tourists speak. Not seldom, I was greeted in Romanian and once, we even spoke in Romanian with the seller who was quite fluent.

Another way of establishing liking used by merchants in Istanbul is the universal language of football (soccer for readers who wrongly believe that football is a different game). Usually, tourists are asked by vendors where they are from. 

The moment one answers the question, the merchant replies with names of footballers from the country the tourist is from.

In the case of Romanian football players, the Turks know quite a large number of names, but this is mainly because many Romanian footballers played in Turkey. Usually I got: “Hagi, Popescu, Filipescu, Ilie” (all played at Galatasaray).

Once I said that I am from The Netherlands and the only name I got was “Dirk Kuyt” … kind of thin considering the large number of famous Dutch footballers.

2.  Making things easier and simple.

I could write a lot on how the merchants of Istanbul make it simpler for tourists to spend money, but the one thing that impressed me the most was that in many restaurants and shops had especially employed people to open the door once a passer-by stops even for one second in front of a shop or a restaurant.

3.  Choice architecture and leaving a tip twice.

In restaurants, I noticed that the staff was well versed in encouraging customers to leave a tip twice. The custom in Istanbul is to leave a tip of about 5-10%. Some restaurants include the tip in the bill. For example, if the food and drinks amount to 64 Turkish Lira (TLR) there is another 6 Lira added for service and the total is written in large fonts 70 Lira.

Since the bill is written, usually, in Turkish and most tourist customers look only at the total, sometimes they leave another 5-10 Liras as tip, even if the service was included in the initial bill.

What I found fascinating was that at one restaurant which included the service in the bill, the change came in a particularly interesting denomination. For example, if the bill was 64 Lira, the total was 70 with 6 Liras for service. If the client paid with a 100 Liras banknote, the 30 Liras in change was brought as one banknote of 20 Liras, one banknote of 5 Liras and five coins of 1 Lira. This encourages customers to leave 2-3 Liras (in coins) as a tip, even if the service was included.

4.  Endowment effect

Quite a few times I was approached by people working at restaurants with the following phrase:

“Sir, your table is right here on the terrace”.

Now, who would want to lose their table?

5.  Physical environment influences and apparent reciprocity.

After the first night spent in the hotel, we came back from our sight-seeing and noticed that on the night stand there was an envelope with “Tip Box” written on it.

Subsequently we noticed that virtually everywhere there were tip boxes.  

Another interesting use of environmental influences was that in all restaurants and shops the temperature was quite high. It was December when we visited Istanbul, but the weather was quite OK and it is nice to eat or shop in a warm environment, but I don’t think that sweating is necessary. Nonetheless, a higher room temperature is always good for spending money.

In some restaurants and shops the customers are offered tea or a small desert (Turkish delight or baklava). This is not exactly free, but the staff gives the impression that they do it especially for you. Subsequently the likelihoods of purchasing and / or leaving a larger tip increase.

6.  Anchoring and mocked bargaining.

Yes, Bargaining is part of the touristic experience in Istanbul. And the Grand bazar is the most appropriate place to do so.

The thing is that the merchants in the Grand Bazar and, in fact everywhere in Istanbul, are more versed in sales and bargaining than all the tourists put together.

We looked at an artisanal coffee set as a gift for my parents and I asked how much it was in Euros. The merchant said:

“Normally it is 80 Euros, but now because it is winter and there aren’t many customers in the bazar it is only 50 Euros”.

The Grand Bazar was not packed with tourists, but it wasn’t empty either. We managed to get the coffee set for 46 Euros, but when we arrived home we realized that it only looked like copper … it wasn’t real copper... it was painted with a copper like paint...

7.  The honest cheater (?)

It was quite late and after a 4 hours flight, 3 hours delay and a crazy half an hour taxi ride on the streets of Istanbul, we were quite exhausted and happy that we finally arrived at the hotel.  

The gentleman at the reception was very welcoming and gave us a 5 minutes crash course on how we will be cheated by merchants, taxi drivers etc. Personally, I knew that we will be cheated, which is part of the tourist experience in Istanbul.

What I found very interesting, was that at the end of the micro-lecture the gentleman said, with the aura of a concierge, that if we want to buy anything – leather, gold, carpets etc. – we should ask him and he will recommend some honest shops…

This got me wondering about the commission system that I believe works very well in Istanbul. Although I have no proof to doubt his honesty, I had a feeling that everything he said could be reframed as:

“We don’t want others to cheat you. We will cheat you and you will have the impression that you got a good deal.”

Well, we weren’t there for shopping and we knew that we will be cheated, at least a little.

Everyone has their limits

On the last full day in Istanbul, we were approached for the zillionth time by a street vendor who was trying to sell us a tourist guide of Istanbul.

He employed the use of the representativeness heuristic: and immediately offered an Istanbul guide in Russian. (I do look like a Russian, but really I am not). I answered that we are not Russians. The vendor, immediately found the next best assumptions:

“Aaa! Ukrainians. I have in Ukrainian”

“We are not Ukrainians”, I answered

“Latvia?”

“No!”

And then, the traditional: “Where are you from?” followed.

I was already annoyed enough by the quite aggressive sales techniques, of being mistaken for a Russian for the zillionth time and being asked 30 times a day “Where are you from”… So I said:

“Namibia”

The very prompt answer was: “Hai Sictir” which I immediately understood since it is used in (old) Romanian for “Go F*ck yourself”. I guess in Turkish it has the same meaning…

All in all, Istanbul is a great place to visit. We were particularly fortunate that our friend Nejla is living there and we got some local insight. Thank you Nejla!

I wish you all a good 2015!

And visit Istanbul if you want to see Behavioural Science applied in merchant practice… 

Though, don’t bring too much money. The local merchants are very skilled in taking it from you! 

Take a look at my new website www.naumof.com