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Are Cognitive Biases On The Increase?

Are we in Market Research spending less time than we should in thinking about the consequences of Behavioral Economics?

cognitive bias

 

By Edward Appleton

Behavioral Economics (http://bit.ly/SXzSN) no longer seems to be the hot topic it was for Market Research in the past few years. Maybe we’ve simply read too much about it too frequently, or maybe we feel in essence that it’s telling us nothing new.

Today made me wonder if the broader Marketing Community is thinking differently: that  those in Advertising, PR, Marketing, Communications are actually embracing the concepts of BE with energy.

I was playing around on Google’s Play Store (http://bit.ly/yrtBJe) – which is what perhaps the brand is suggesting I should do – and downloaded a few free Apps. After the downloads, I was prompted with the following:

“Keep Shopping”

This brought me up short: shopping to me is always about spending money. I hadn’t been “shopping” as far I was concerned. However, just reading the word “shopping” made me think twice – maybe even prompting me to think – maybe I should just consider downloading some music – after all, a single track of a favorite singer is hardly going to cost the world.

Was I being what is called “primed”?

I’m in the middle of reading Daniel Kahneman’s remarkable book “Thinking, Fast and Slow” (http://amzn.to/kJTPvP). In the fourth chapter he describes the phenomenon of “priming” – the influencing of our behavior through associative triggers which we are simply not aware of consciously.

He illustrates it by recounting experiments carried out by fellow psychologists.

One example: a group of students is asked to fashion four-word sentences from five-word scrambles. One group is given words associated with old age – “Florida, forgetful, bald, gray, wrinkle” – but not containing the words “old age”. After completing this task, they are asked to walk down the corridor for the next test, and the speed with which they walk is measured. Compared to other control groups, the group who had been exposed to the words suggesting elderliness walked significantly more slowly to their next task.

In another experiment, a group of participants is exposed to money more or less subtly, ranging from a word-sort exercise with five money-related words to screen savers with dollar bills floating in water. Immediately after one such exposure, the test group is confronted with a student who deliberately drops pencils on the floor. Those exposed to the money stimuli participants pick up fewer pencils. Priming with money is demonstrated (via this and other examples) to encourage individualism – the author avoids the term selfishness.

It’s pretty scary stuff – but clearly well validated. As Mr. Kahneman says baldly: “The results are not made up, nor are they statistical flukes”.

So – back to my original point: are we in Market Research spending less time than we should in thinking about the consequences of Behavioral Economics? Here’s my take:

1. As more and more Decision Makers the world over become aware of the powerful findings of Behavioral Economics, they are more likely to test their potential impact.

I would hypothesize that the effects of priming in all sorts of communication are likely to increase.

Governments struggling to find effective strategies to counter increasing obesity levels, Brand Owners looking to stimulate trial, Advertisers looking to come up with more powerful creative brand stories with better test results – there’s a whole host of people who will have a reason to experiment with priming effects.

Market Research should consider the likely impact of this potentially increased stress on subtle influencing strategies.

2. The way we go about understanding why people behave in a certain way needs to become increasingly sophisticated.

Just asking people “why do you say that?” will to me at least always have a role in the diagnostic process. However, it’s probably not enough.

We need to add measures of derived understanding wherever timing and budgets allow – using choice based tasks, for example to derive utility values, comparing test and control samples to see how drivers of choice differ, embracing predictive analytics on however simple a level.

Whether it’s qual or quant., just using one tool to answer the question “why” won’t be a powerful approach.

3. Behavioral measures and observational techniques need to be part any form of serious diagnostic analysis.

Understanding why someone behaves in a particular way is never going to be an easy task – all behavior is embedded in complicated, intermeshed networks: culture and context are strong drivers, as is peer group pressure.

Using as many data points as we can is the order of the day, as near to actual, point-in-time behavior as we can manage. Ideally, this should include unobtrusive observation in real-life contexts over a period of time, subtle interaction, asking of clarifying questions, probing on apparent contradictions.

So rather than turning our backs on Behavioral Economics, and focusing on the next topic of the moment – such as Big Data – I’d say we’d be well advised to anticipate a surge in BE techniques in communications in many fields. We should be on our toes when it comes to responding adequately with our Insights toolkit.

Google wants me to keep shopping. I think perhaps it’s better for me to keep thinking.

Curious, as ever, as to others’ views.

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7 Responses to “Are Cognitive Biases On The Increase?”

  1. Judy Melanson says:

    January 7th, 2013 at 9:10 am

    Love it! Thanks for the reminder Edward!

  2. edward04 says:

    January 7th, 2013 at 1:13 pm

    @judy – thanks, and Happy New Year to you!

  3. Matt Valle says:

    January 7th, 2013 at 1:38 pm

    Great post, Edward. I expect a deeper understanding of BE will have a strong, positive impact on the quality of MR – simply by improving our methods and models to better predict consumer behavior. Marketers who get it early – like your Google example above – will reap disproportionate early rewards.

    The current Foreign Policy magazine has an interesting article (“The Nudgy State”) about Britain’s PM David Cameron’s “Behavioural Insights Team”, designed to address similar issues to your Point #1 above – the concept is being further adopted in governments like Australia, Denmark and South America. Also, Poor Economics, by Banerjee and Duflo, applies BE thinking to solve problems with global poverty and humanitarian aid – a very insightful read.

  4. edward04 says:

    January 9th, 2013 at 1:38 pm

    @Matt- thanks for your comment. I read the Foreign Policy article, and again wondered if the people taking BE aggressively forward are Change Agents – including Brand Owners, Gvts….. Maybe they have more of an incentive to do so. For Insights I see BE as offering more challenges to embrace – rather than adopting a defensive-aggressive stance – and frankly be in thick of things, centrally involved in Change projects, rather than a Measurement Agent brought in at certain moments in time.

  5. Rags Srinivasan says:

    January 11th, 2013 at 9:25 am

    I enjoyed this article. Paradoxically, your title question suffers from cognitive biases (selection bias, availability heuristic and recency effect to name a few).

  6. edward04 says:

    January 11th, 2013 at 12:06 pm

    @rags – headlines in my humble view should attempt to engage, capture your interest, make you want to carry on reading. Did it work for you? I don’t see a paradox.

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    […] Are Cognitive Biases on the Increase? […]

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