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 far-fetched 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.
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…” lead to an increase in the voluntary compliance.
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:
Behavioral science can, sometimes, be used to create cheats so that a company (organization) gets X dollars extra from the clients’ pockets or bank accounts.
This is not illegitimate. After all, in a market economy, companies try to maximize what they sell. All people who are uncomfortable with this 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.
The use of default opt-ins for buying travel insurance along with a flight ticket.
These behaviorally informed cheats are, for sure, controversial and to some extent subject of public and regulatory scrutiny. However, most of them are not illegal and they are simply part of the arsenal of XXIst century marketing.
When faced with cheats, people say:
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 welcome. 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 that today’s youth appreciate Metallica). At least for this author, a Metallica concert ticket is more valuable than €100 (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 sports 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!
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.