THE BEHAVIORAL ECONOMICS GUIDE 2014 – A FREE BEHAVIOR CHANGE RESOURCE

In the Northern Hemisphere at least, the Summer holidays are upon us. So for a lot of us it’s time to pack our bags and get somewhere we can relax, put our feet up, and catch up on some reading.

Ordinarily we’d do a post listing the best psychology and behavioural science books to have come out in 2014, but this year we’ve got something a bit more exciting to talk about. Our academic advisor Alain Samson, a psychologist and consultant who works with the LSE, has put together The Behavioral Economics Guide 2014. It’s a free up-to-date introduction to behavioural economics, with contributions from a bunch of companies who are putting the science to use for commercial impact.

OK, we admit it. It’s not really beach reading. More like a gentle workout for the mind once you get back from that well-deserved holiday and need some inspiration and ideas. The short book is in four parts. Continue reading

Paths, Pirates And Pachyderms

A few years ago, file-sharing was a massive problem for content owners. At its 2008 peak, a third of US internet traffic was through file-sharing networks. Six years on, that’s down to 8%, according to this Mashable story.

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The elephant does not acknowledge your warnings.

Since internet traffic is always increasing, that doesn’t mean the absolute amount of piracy has diminished, but it certainly hasn’t kept up with the net as a whole. So where did the pirates go? Streaming services, apparently – streaming video, particularly Netflix, now accounts for a massive proportion of online traffic where file-sharing has sharply dwindled.

It’s interesting to look at this story through a behaviour change lens. At BrainJuicer we talk a lot about “building a path for the elephant”. Human decision making is like a rider and an elephant. People think they can influence it by persuading the conscious rider, but ultimately the rider has little control over the mighty elephant – and the best way to change behaviour is by building a path that the beast automatically follows. So with that in mind, let’s look at file-sharing. Continue reading

Practically Irrational

Some of you might remember that we got quite excited when Dan Ariely – the economist author of the best-selling Predictably Irrational – ran a Coursera course on Behavioural Economics. A bunch of BrainJuicer people signed up for the course, and loved it.

So we’re excited to see Ariely’s new startup: Irrational Labs, a nonprofit consultancy pledging to use behavioural economics for good. Part of the Irrational Labs offer is a series of behaviour change workbooks, which they are selling as a PDF bundle for $60. This post is a review of said workbooks.

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Spot the nudge.

Full disclosure: Irrational Labs asked us for a review and sent us the workbooks free. Even fuller disclosure: Irrational Labs might be, in some circumstances, a competitor, though when it comes to behavioural science we feel a rising tide floats all boats – anyone spreading the word gets a thumbs-up from us.

So with those disclosures out of the way, let’s review. Continue reading

The Best Graduate Job In The World?

michaatdeskMicha Dudley joined our Labs team in September as a graduate. In this post, she writes about the experience. (The title is Micha’s suggestion not mine!)

The first thing I’m struck by, as Hugh from IT sets up my new computer, is the daunting piles of behavioural economics books on Pete and Orlando’s desks. Whilst I’m writing down all my passwords, Pete pauses from an email, looks at his book towers and pulls one from somewhere in the middle. He’s flicked to a page in seconds and is double-checking a quote he has already typed out from memory. I’m torn for a moment between feeling intimidated by the steep learning curve ahead of me and feeling excited that I clearly have highly-informed teachers to guide me.

Everyone has been very welcoming all morning, and we’re about to head into a Labs strategy meeting with the management team. (Who stand in a row and are introduced to me as John, Jim, James… and Alex. I congratulate myself on being able to hold Alex’s name to his face, but then they all move away and I realise with dismay that if John, Jim and James don’t continue to stand in the same order, my name-crowded brain will let me down.)

The strategy meeting is an inspiring way to kick off my first day. Everyone truly cares for and loves BrainJuicer – it’s their baby they are helping to grow. The future looks exciting for the Behaviour Change Unit; the first few projects Orlando and Pete have run as founders of the team have been very successful and expansion is the next step, with lots of exciting big projects on the horizon. Continue reading

A World Without Nudges

The increasing interest by Governments worldwide in “nudging” to promote behavioural change has not gone un-noticed by people opposed to any kind of Government intervention. Nudges, say those of an anti-Governmental or libertarian persuasion, are nannyish, dangerous and illiberal. This is conveniently forgetting, of course, that it’s not just Governments who use psychological biases and heuristics to influence behaviour – retailers, brands and advertisers have been doing it for years.warningnudgesign

So nudging is here to stay. But what if it wasn’t? Or – more specifically – what if regulators decided that informed consumer choice required people to be informed of particular psychological techniques companies might be using? Like priming, for example – the controversial effect where apparently unrelated, subconscious cues can trigger behaviour. Continue reading

E.ON’s Boomerang Effect

Further evidence that behaviour change is moving into the mainstream – energy provider E.ON has announced the release of an “energy saving toolkit” which is explicitly upfront about having “behaviour change” as its aims. What does it do? Basically, it shows you data – on your own usage over time, but also your usage against a group of 100 other random, anonymised households. So you’ll be able to see where your energy use ranks and – presumably – you’ll be motivated to take steps to control it.

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“In your face, social norms!”

Will it work? E.ON’s intervention is taken straight from a classic behavioural study – Wesley Schultz and his colleagues’ examination of social norms and energy usage, from 2007. And this offers encouraging news for E.ON – people told they were using more energy than their neighbours really did drop their usage. Like most UK energy suppliers, E.ON has faced accusations of greed as bills rise – and Schultz’ results suggest that their initiative really will help some people save energy. Continue reading

The Ideal Incentive?

Here’s a straightforward, but fun, example of encouraging behavioural change. Mexican parks have a dog poo problem. They also – unlike parks in the US – don’t ususally have public wi-fi hotspots. So internet company Terra is bringing parks free wi-fi, metered by the amount of poop scooped. The more crap park users put into bins, the more, er, high quality online content they’ll be able to read while sunning themselves.

It’s a wheeze from agency DDB, and as the piece says, while the execution is tongue in cheek the offer and benefits are real. This isn’t the first time ad agencies have used wi-fi access in a promotion – controversially, at South By Southwest this year, the agency BBH turned homeless people into “living hotspots”, a move which sparked a lot of debate around the ethics of the campaign. The Mexican parks initiative feels like that promotion’s more respectable cousin.

It’s a small price to pay for all those cat pictures.

Both campaigns, though, hinge on the marvellous properties of public wi-fi access. Public behavioural change is very hard to pull off for all sorts of reasons, but one of them is that it’s difficult to incentivise. A lot of bad public behaviour – from noise pollution to letting your dog shit everywhere – involves an individual trading their convenience for the inconvenience of many others, and is usually dealt with by cracking down on the individuals doing it. Except that once it becomes normalised, crackdowns don’t work. So you can increase the inconvenience of doing bad – reducing rubbish collections to encourage recycling, for instance. Or, in the absence of the stick, you can turn to the carrot.

But what kind of carrot? Actually giving people money for doing something they should be doing anyway feels like a slippery slope – though it has been done, as in the VW “speed camera lottery”. But perhaps you’d be better with some other kind of reward.

Enter wi-fi, which turns out to be almost perfectly designed as a behavioural change incentive. Public wi-fi is a clear public good, but not (yet!) so essential that depriving people of it would provoke outrage. It can be provided at flexible levels – as in the dog poo experiment. It can, I grant you, be abused in ways that inconvenience other users – but it’s far more difficult to do this than it is in physical public spaces. So it’s unlikely to solve one behavioural problem by creating another.

At the moment it’s only commercial agencies like DDB who are experimenting with this, but the flexibility and usefulness of wi-fi as a reward (especially in the mobile Internet age) means that anyone interested in behavioural change should be looking at these experiments very carefully indeed.