Nudge and better choices

We’re not always the rational creatures that classical economics makes us out to be. In 2008 Richard Thaler coined the term Nudge Theory (paraphrased “Where Economics Meets Psychology”). It’s a well trodden path and includes such exciting terms as Behavioural finance but fundamentally they all look at the ways in which our psychological biases get in the way of making decisions.

At it’s simplest level its about presenting the people with rational, sensible and best-solution defaults as people can be persuaded to accept defaults if they seem sensible. At a deeper level its about firing the sub-conscious automatic elements in our thinking to create a desired outcome. The theory is gaining a lot of credibility as an approach for running large organisations such as governments as we saw in 2008 when Richard Thaler visited Britain to promote his theory. He met David Cameron, and made such an impression that for a time he acted as unpaid adviser to the Tory leader.

The philosophy of approach to designing systems of choice is often referred to as “libertarian paternalism”or “choice architecture”, a concept implying that an organisation can be the architect that arranges personal choice in way that nudges customers in the right direction. This might seem all a bit high-brow for a web-site but you’d be wrong.

Planning how and what the site visitor sees and the order in which it happens is all choice architecture and with modern, personalise-delivery web-site platforms such as VITES  it really is quite easy to implement. Examples?

a. We want to encourage people to visit our flagship outlet in Bristol. The default choice for venue then become Bristol, regardless of where you are in the UK. All the supporting content talks about how good Bristol is, the photos are from Bristol etc…people automaticallt make a connection with Bristol and as Bristol is the first default choice then a higher-than-normal percentage of people will go there.

b. We want to encourage people to request an email version of our information pack, that becomes the default choice and whilst the visitor can still request a printed pack that route requires the visitor to go through one extra hoop. In this hypothetical case it’s simpler, cheaper and more effective for the visitor to receive an electronic pack so we have nudged them down a more successful route.

c. We want people to call us on the phone rather than fill in a contact form. Everyone in the online enquiry process is off-ramped to a call-back, stating “We need to talk to you to clear up xxxx before we can confirm your booking”. The visitor is not to know that everyone is off-ramped, they will think it’s just them.

It is worth reading Richard Thaler’s book, available from Amazon and costs a fiver.