Gap between intended and actual behaviour
Sure, addicted is probably putting it too strongly, but my affair with Heineken got me thinking about the gap between intended and actual behaviour You see had I been invited to a market research group and asked about my gaming, beer and rugby behaviours, there is absolutely no way I would have predicted my own slavish usage of the final product. I mean, who has the time or interest in pretending to punt a ball over an imaginary goal post? I just doesn't make rational sense.
And that's the rub for product marketers. We spend a lot of time researching what our market think of our widget or brand, but we often get results based on intended rather than real behaviour.
Here's where Behavioural Economics comes in.
Behavioural Economics gets to the truth of behaviour
Behavioural Economics is based on behavioural studies rather than attitudinal ones, so in my scenario the research would have tested the efficacy of different techniques to stimulate download - from memory, I downloaded from an ad on a newsite, the user flow for download, any inhibitors to sign-up (eg asking for date of birth might have been too sensitive), and so on. Traditional market research would more likely have spent time defining the target market (i.e. not me) and predicted take-up based on reported intent.
As to uncovering what would influence me to download the game, common theories would revolve around the creative's call to action, the perceived value of the user benefit, maybe even personal recommendation. If I had been asked, I probably would have said a combination of these factors. But what really influenced me? Whilst of course I had to see and understand the ad, I could have ignored it like I have every other. What made me download the App was that I was looking for examples of how brand's were applying social media to engage their customers. That's right, a virtuous professional reason! Behavioural Economics would have used tested techniques to influence downloads - herding (doing what others do) and completion (my willingness to step up and kick for Australia) amongst them.
How Westpac NZ has used behavioural economics
An example that's fast becoming a classic illustration of closing the gap between intended and real behaviour is the Westpac New Zealand Impulse Saver App. Developed on the insight that people have till now had the mechanisms to impulse buy (money, credit cards), but not impulse save, the App allows customers to add money to their savings at the touch of a button. The bank's objective is to grow the penetration of savings accounts beyond 49% of population. Did the insight come from discussions with a focus group? I don't believe so. Whilst market research quantified the volume of savings accounts and no doubt other market sizing elements, the key insight was instead based on observation of actual behaviour. New Zealanders impulse spend $16.1m every day.Behavioural Economics can overcome short comings of Market research
So am I bagging market research? No, I think the more time we can spend understanding our market the better. But I do believe market research techniques that concentrate solely on intended and predicted behaviours have serious short comings. Sophisticated researchers use different techniques to try and dig beneath hyperbole (I particularly like image based metaphors to untap emotional and cognitive associations, and there's some merit in ethnographic observation), but behavioural economics can take it so much further by translating insights about actual behaviour into...well, actual behaviour. And as a marketer, that's our goal!
For more on Westpac's App check out
And for the Heikeken game, http://itunes.apple.com/au/app/heineken-rugby-clubhouse/id450375998?mt=8
Status quo bias – comfort in sticking to what we know, and
Loss aversion – being more fearful of losing what we have than risking a gain
There’s a lot of comfort in a big, professional document because that implies safety, thoroughness and, frankly, that someone else has done the thinking so we don’t have to. (It also helps to justify the expense on the research because quantity still trumps quality a lot of the time in perception management).
Of course it's not just market research that taps into our desire for credibility. Just think about the business documents and spreadsheets we slave over that your boss may not even read. Executive summaries are there for a reason after all.
The other interesting thing we can draw from behavioural economics is the “not invented here” bias that we are subject to – in this case it explains why a lot of those research findings don’t go anywhere. To get traction, the stakeholders need to be part of the insights generation phase, otherwise the outputs are likely to be filed away in a drawer.
So what's the answer? How about we take some chances and throw away the templated documents, the proforma Powerpoint presentations, the phone book sized research reports and instead throw some reflections up on a whiteboard to discuss, challenge, laugh about, but ultimately get stimulated enough to take action? Getting your researchers to evoke insights rather than yawns? Sounds good to me.
Image from http://jameswoodward.files.wordpress.com/2008/08/piles_of_paper_small.jpg?w=200&h=239