Which plate from the picture above will nudge you to eat less? Serving on a 20cm or 30cm plate? If we will think about it rationally, then a 20cm plate is best for eating less because you can’t fit as much food on it. But given a real-life context in a cafeteria, during a lunch at work, where the food is free, people don’t give too much thought about the plate size. So if there are 30cm plates, they will put on as much as it fits. And also grab the first thing they see.
Some simple products we use on a daily basis can influence our behaviour on a subconscious level more than we think. Why? Because people don’t always have the time to consider every action through. Recent academic studies in cognitive psychology, social psychology and behavioural economics suggest that over 90% of our decision-making is conducted somewhat unconsciously and automatically on a daily basis.
So there are small tricks that we can apply to our mind so it does certain things but in a better way. These little tricks are called – nudges.
“A nudge is any factor that significantly alters the behavior of humans. To count as a nudge, the intervention must be easy and cheap to avoid. Putting the fruit at eye level while it encourages for it to be picked up or bought counts as nudge. Banning junk food does not” - Richard Thaler, Nudge
As the book Nudge by Richard Thaler states, anyone who creates the environment in which decisions are made is known as a ‘Choice Architect’. And it’s a part of almost all types of jobs (from doctors, accountants to architects).
Status Quo Bias
Before we dive into examples of how nudges work and can improve lives, you have to know about Status Quo Bias. For lots of reasons, people have a general tendency to stick with their current situation.
“Status quo bias is an emotional bias; a preference for the current state of affairs. The current baseline (or status quo) is taken as a reference point, and any change from that baseline is perceived as a loss” - Wikipedia
An example of status quo bias is when you buy a new cell phone, you have a series of choices to make. Change the ringtone, wallpaper, pre-installed apps, the voice mail message and so on. But for most products, the manufacturer has picked you a particular setting for all these features already. Research shows that whatever the default is, people tend to stick with it. Even when stakes are much higher than choosing what ringtone your phone has.
Another excellent example of status quo bias are students and their seats in classrooms. Most teachers know that students tend to sit in the same place in class for many years, even without a seating chart. It happens even when you change the classroom for a different lecture.
Changing eating behaviour only by changing places
To begin with a great example of how a nudge works, Google employs the use of Choice Architects. To help nudge their staff into making healthier food and drink choices. Their cafeterias are known for free and good food but’s it’s not always the most healthy one. So people tend to pick up more than needed. And some of them end up with extra weight.
They thought about rearranging their cafeteria to put the salads as the first thing you see and pick. And the sweets and the rest of the “not so healthy food” at the end. Why? Because when you are hungry, you tend to put on your plate the first thing you see. Also, they label the healthy stuff with green. Meanwhile, high-calorie food is marked with red. Take a look at this short video (5 min) to see how it works.
And we all know this feeling very well. For example, when going to a supermarket on an empty stomach, you tend to buy all kinds of unplanned “bad products” (chocolate ;)).
Default options can have a big impact
So setting default options or settings can have a significant impact on an outcome. From increasing savings to improving health, to provide organs for lifesaving transplant operations. And a well-chosen default setting is only one illustration of the power of a nudge.
For example if you are a finance company whose premise is to motivate people to invest and save more money, you can make a default option that each month 10% of a person’s salary is transferred to a savings account, another 5% to a particular fund, and the rest can be used how the user wants. Rather than giving your customers the options to move that 10% into a savings account by themselves.
Sometimes an “opt-in” should be a default
A default setting can save someone’s life. For example, the health app from the iPhones doesn’t have an automatic “opt-in” as an organ donor. You have to set it up for yourself. But most people don’t even know that feature exists, so we miss out on a lot of potential life-saving situations.
On the other hand, we could mark the checkbox and give a notification to the user that it is checked so if they want to, they can opt out. And the most interesting part is that people will opt out less than opt-in because the choice was already made for them.
Doctor cutouts that boost sales
Apparently, the presence of a doctor cutout that says that fruits or vegetables improve health (a style of Nudging where unconscious cues influence behaviour) increased sales of fresh fruit and other healthy goods by up to 30% over the 15 week trial period. (source)
Creating designated shopping trolleys parts
Supermarkets have long realised this and often experiment with different Nudges. Collin Payne, an assistant professor in NMSU’s College of Business, conducted research at one of the supermarkets in New Mexico. He created a visual Nudge by marking a line with yellow duct tape across the width of shopping carts. And placed a sign on the cart asking shoppers to place fruit and vegetables in front of the tape line, and the rest of their groceries behind the line.
“And what we saw was a bump of a 102% increase in purchasing of fruits and vegetables with that simple sign and line” – Payne
This nudge prompted people to buy more fruit and veg without decreasing store profitability. These small interventions are simple and inexpensive to implement, but can have a dramatic impact on improving people’s diets.
Saying it in a different manner
When making a decision, we have a bias towards positive things. So for example, if a doctor suggests that you need to have surgery and he will tell you that there’s 10% chance of death, you are most likely to opt out. But if you were told that 90% of the times all goes fine, you would have been more willing to do that surgery.
This happened to me too. When the doctor suggested surgery, and he said that there is a small amount of chance that it will fail, I refused. And only recently I realised that he also told me about the fact that it works fine almost all the time. If he had told me the positive part first, I would have opted in. So the way you frame the default message is also meaningful because it changes a future perception of your product.
Increase the default number
If you have visited New York City you probably saw the three tipping options in the back of the famous yellow cabs. At the end of a journey, you see on a tablet, default tipping options of 20%, 25% and 30%. These pre-selected options set a default of how much to tip. But it’s interesting that by changing the number to a higher one, people tip more.
When cabs were cash only, the average tip was roughly 10%. After the introduction of this system, the tip percentage jumped to 22%. Those three buttons resulted in $144,146,165 of additional tips per year.
In the same way, some charities apply this for their donations. When you show that people pay or give on average three types of donations $100, $250 or $500 — you have a higher chance of getting a bigger donation. By showing a higher number we tend, usually, to choose the lowest tried version. And in this case it would be $100. Of course, you can always allow your audience to donate whatever they want. But the benchmark was already set in their mind, so you still have a chance that the donation could be higher than intended.
Create an illusion of progress to encourage action
You see this example in a lot of coffee shops and the reason why a pre-filled card works is because it’s a sign of progress. All you have to do is fill in the rest. Because if you are given an empty card, you have a higher chance that the person will never come back. Yet, the same rule does not apply with monetary incentives when you are trying to motivate people to achieve or finish something.
How can this method be applied to software? For example, when there is progress or downloading bar, you can start off with 10%. Because there is a difference in how you perceive 0% of progress and 10% of progress. The latter one gives you slightly more encouragement to proceed or wait.
An interesting case of how a nudge may be applied comes from, the men’s room at Schiphol Airport in Amsterdam. In each urinal there is a small house fly painted. The reason for that is because men, usually, do not pay much attention to where they aim, which can make a bit of mess. But if they see target, they tend to aim at it, and therefore increasing the accurancy and attention. (oh, well…)
“If a man sees a fly, he aims at it. And it improves aim.” says Aad Kieboom.
An economist, that directed Schipol’s building expansion. His staff conducted fly-in-urinal trials and found that it reduced spillage by 80%.
In the end…
These examples are only a preview of what is possible with behavioural economics. Which can easily be applied in anything you design or create — from software to services.
But the most important thing to remember is that people are too busy and lazy to think about small details that impact their lives. Even if they are capable of doing it by themselves, there is not enough mental room in current living environments. But we can help them make better and more rational decisions.
For a better picture, imagine that you are the parent of two kids. And every day they go to the kitchen to grab some candy, but you know that they will always take more than needed. So instead of saying “no” to them and break your relationship, you could leave only two or four candies, so they don’t go over the norm.
A big thanks to 42courses.com for allowing me to use their illustrations.