What I Learned From Behavioral Economics Bootcamp
How to change behavior for good.
I recently completed an intense, 9-week Behavioral Economics Bootcamp for product leaders with Irrational Labs to dig deeper into why human beings make irrational decisions and what we, as product owners, marketers, and social-good practitioners, can do to nudge people in the direction of better decisions.
My head is chock full of implications, ideas, and plans. Here are my seven biggest takeaways.
There are so many decision-making biases and they’re everywhere.
As someone with a psychology undergrad and years spent in the trenches of marketing, research, and user-centered design, I knew people often said one thing and then did another. That’s one reason I’m such a firm believer in observing a person’s behavior versus just taking what s/he tells me at face value. However, I hadn’t realized there were so many principles that affect pretty much every decision we make. How much money we invest for retirement, whether we buy those new jeans, and even the food we eat for dinner. It’s all influenced by decision-making shortcuts, biases and the mental models we carry. In the bootcamp, we deeply explored at least 40 behavioral principles, along with at least as many strategies to overcome them. I’m not going to lie; it has made me a little paranoid about how the world is manipulating me. Luckily, with knowledge comes power.
There is a repeatable process for overcoming behavioral barriers.
In the bootcamp, we applied Irrational Lab’s 3Bs Framework for identifying the key behavior we want to affect, diagnosing behavioral barriers and brainstorming ways of increasing the benefits to the target user by doing the key behavior. This logical, step-by-step process makes solving for behavioral barriers much more approachable by focusing our energy on a very specific behavior. For example, at Stronger U Nutrition, a nutrition coaching company, we decided to help busy moms abstain from unplanned nighttime snacking. This level of granularity kept us from boiling the ocean with all kinds of behavioral interventions.
Our future self is a different person.
It’s like there’s two of us. Our rational self, who at 8am is determined to make good food choices to live a long and healthy life… and our hangry, stressed out, 3pm self that dives head first into the donut box. In behavioral economics lingo, this is present bias. Essentially, we humans put a lot of emphasis on the here and now and discount the value of the future. This makes it really hard to follow through on the boring stuff that’s good for us and even harder to resist immediate gratification, like delicious donuts.
The best way to combat present bias is to substitute fun, immediate, tangible rewards. In the case of Stronger U and members’ nutrition goals, this could be awarding them points for staying on track or having them complete a fun mini-mission at night when they might otherwise be snacking. The limit here is our imagination and our ability to implement.
Information does not change behavior.
I wish this was not the case. Unfortunately, studies show that behavior change requires more than information. A meta-analysis of more than 200 studies found that financial education interventions explained only .1% of financial behavior. There’s an intention-action gap, where even if we know what we should do or even intend to do, that doesn’t mean we’ll do it. The ease of sticking with our current savings behavior or doing what we’ve always done, known as status quo bias, is hard to overcome. In addition, the effects of decision-making shortcuts and bias are usually at a subconscious level. That’s why carefully architecting options, smart defaults, and amping up rewards are so important to nudging people in the right direction.
Start by understanding and changing the environment versus the mind.
This is top of mind for me because of my work with Stronger U. The environment is a huge driver of our decision-making and in the case of food, we’re exposed to more than 200 food-related decisions per day. Helping Stronger U members architect their environment to remove temptation and to increase their support system greatly improves their chances of hitting their nutrition goals. Changing the environment is also substantially easier than addressing deep psychological and emotional components, thus making it a better place to start.
A small intervention can actually impact behavior.
During the bootcamp, I applied the 3B framework to the key behavior of unplanned nighttime snacking by Stronger U members. After conducting a behavioral diagnosis to identify behavioral barriers and brainstorming possible interventions, I chose one to implement via a structured experiment. The choice took into account infrastructure and resource considerations. Stronger U coaches sent one of two text messages to a random sample of their members. Each message employed a behavioral economics principle.
The results? Participants who received the text messages reported doing 12–14% better with unplanned snacking than their control group counterparts! This magnitude of impact from a specially-worded text message is super exciting and lays the groundwork for larger, more complex future experiments.
Apply behavioral economics to everyday life.
Since we’re constantly affected by bias, heuristics, and mental models, it seems only fair to apply strategies for managing them to all areas of our lives. I’ve started applying BE to my life in the following ways:
- Effective email. I make requests simple and clear, add deadlines, and highlight the benefit to the recipient. As a result, the recipient is much more likely to take the action I’ve requested.
- Limited choice. Instead of the open-ended “where should we have dinner,” I present two to three choices along with my preference. This cuts the debate from 20 minutes to two.
- Future orientation. A picture on the wall of my “future self” makes my long-term goals more tangible and helps me avoid impulse snacking.
On the other hand, my husband gets truly annoyed when he realizes I’m trying to elicit an implementation intention towards something I’d like completed. I consider this an important reminder that behavioral economics should only be used for good and that every super power has its limits.
About the Author
Nicole Heckman is an innovator and strategist who is passionate about creating a world that enables people to live their best lives. Using blended skills in research, design, and business, she leads teams generating insights, strategies, and growth plans that create meaningful impact. She is endlessly fascinated by what makes people tick and drives their decision-making.
Throughout the behavioral economics bootcamp, she applied her learning to Stronger U Nutrition, a nutrition coaching program she loves that helps people reach and maintain their desired body composition goals.
About Irrational Labs and the Behavioral Economics Bootcamp
Founded by Dan Ariely and Kristen Berman, Irrational Labs is a leading product design firm that uses a behavioral economics approach to increase users’ health, wealth and happiness. Irrational Labs offers consulting, workshops, and a Behavioral Economics Bootcamp. Bootcamp attendees learn about how to use behavioral economics and psychology to understand how people make decisions. They emerge equipped with a framework and toolkit for behavior change for good.
