10 Important Nudges: Simple Things That Can Change Behaviors
Nudging is the process of influencing behaviors through minor changes to information or decision structures. There are 10 Important Nudges which can be used to help make this happen.
Summary by The World of Work Project
10 Important Nudges
Cass Sunstein brought further clarity to the concept of Nudging in the article: “Nudging: A Very Short Guide“. In this publication he identifies and elaborates on 10 specific nudge type interventions, which we’ve summarized below:
1 – Default Rules
The first of the 10 Important Nudges relates to default rules. Changing the default selection in any decision process materially changes the decisions that individuals make. Decision making is effortful, and people generally prefer to avoid it, so will predominantly stick with a pre-selected default.
Two classic examples of where changing defaults has materially changed behaviors include organ donor registration and pension elections.
In countries where the default status for organ donation is “yes, I am a donor”, donor rates are very high. However, in countries where the default status is “no, I am not a donor”, the rates are very low. Similarly, if new employees are by default enrolled into a pension scheme, then enrollment rates are very high, and vice-versa.
It’s important to note that in all of these examples individuals can still choose where they opt in or out. Changing the default just means they need to work a bit harder for one setting than the other.
2 – Simplification
Making decisions requires effort and focus, something people have limited amounts of. What this means is that when decision processes and frameworks are complex, people switch off and potentially make poor decisions. Simplification of decision volumes and structures will reduce the effort that people need to expend on decision making. This helps to increase the number of people making decisions that are in their own best interest.
A classic example of this is complexity in the retail energy market. Many retail energy providers use complex pricing involving many tariffs and variable charges for usage at different points in time. This complexity makes it very difficult for consumers to compare products to choose the best, or cheapest. Regulators often look to force energy companies to simplify their billing information and price structures to aid consumers. Unfortunately, they’re not always successful in their efforts.
3 – Uses of Social Norms
The third of the 10 Important Nudges relates to the use of social norms. Humans are fundamentally social beings. People generally want to feel like they belong and are conforming with what’s expected of them by their peers. What this means is that they are more likely to take actions that make them feel like they behaving in line with others, than actions that make them feel like they are breaking social norms. These acts of belonging reduce the risk of being rejected by the wider group. This is something humans are fairly instinctively afraid of.
Social norming as a nudge is used in many different ways. An example that many people will have seen is that of hotel towels. Signage that says “9 out of 10 guests choose to reuse their towels” is far more effective at changing behaviors than signs that simply say “reusing your towel helps to save the environment”. Another classic example of this is in online retailing where the number of people who purchased a product is often displayed.
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Making an action easier and more convenient will increase the number of people who do it. This is fairly similar to the default nudge, and fairly self evident.
A simple example of this lies in building design. Where buildings have elevators that are easily accessed and prominently signed and stairs that are hidden (or unsigned), then most people will take the lift, even for only one or two floors. However, when lifts are less visible and stairs are well signed, then many more people will take the stairs for one or two flights.
5 – Disclosure
The fifth of the 10 Important Nudges relates to disclosure. Improving the knowledge and information of decision makers helps them make more informed and generally better decisions. One way to improve this information is through increasing levels of information disclosure.
A classic example of disclosure is in the Financial Services industry where firms need to disclose not just the interest free period associated with credit cards, but also the annualized interest rates and, increasingly, what this means in layman’s terms.
6 – Warnings, Graphics or Otherwise
Bold warnings and graphics can influence behaviors and decisions both in favor of or against certain potential decisions.
The most prominent example of this is health warnings on cigarettes. Cigarette packaging now includes photographs of smoking related diseases in many countries.
7 – Pre-commitment Strategies
Humans make different decisions when considering different time periods. We’re generally good at making beneficial and helpful decisions when we’re deciding about hypothetical points of time in the future.
However, we’re less good at making beneficial decisions in the moment. For example, we might plan to eat a healthy salad when we make a dinner reservation for a day in the future. However, when we get there, we are prone to changing our mind and decide to eat a burger instead.
One way to take advantage of this temporal variation in decision making is to commit to future actions. When we pre-commit it harder to change our mind when that point in time arrives. For example, if we pre-order a salad for dinner with our meal, then we’ll probably eat it. If we’ve paid for it in advance and aren’t able to change our mind, then we’ll almost certainly eat it. Whether we decide to eat a burger as well, though, is a different matter.
8 – Reminders and Prompts
The eighth of the 10 Important Nudges relates to reminders and prompts. Remembering information about decisions and decision points take effort, meaning many people fail to do so. This might mean that they forget to change energy suppliers when their contract ends or, more commonly, that they forget to change their mobile phone contracts when they have reached their end date.
A great way to overcome this is to introduce reminders that individuals can immediately act on. For example, in relation to mobile phones, efforts are being made to ensure that phone service providers notify their customers at the point at which their contracts complete, giving them them option to change tariffs to a “sim-only” contract (a cheaper contract in which the customer only pays for the services they use, not the phone itself which they’ve already purchased through their initial contract).
9 – Eliciting Implementation Intentions
People are more likely to do something if they have clearly thought about it and made a decision in advance. What this means is that if you speak to someone and elicit from them what they plan to do, then they are more likely to do it.
A well discussed example of this relates to the intention to vote. If people are asked if they will get out to vote and they say yes, then the probability that they will actually do so increases. The very act of asking someone their intentions, increases the likelihood that they will deliver on those intentions.
10 – Informing People of the Nature and Consequences of their own Past Choices
The last of the 10 Important Nudges relates to informing people of consequences. People often lose sight of how they’ve behaved in the past, and the outcomes that these behaviors lead to. This means that they have not been effectively able to learn from their past decisions when making future decisions. To help overcome this, it’s possible to inform them of their prior decisions and consequences. However, this type of intervention requires a lot of data.
One simple example of this in practice could be energy suppliers providing consumers with monthly information about how much money they saved by using night-time tariffs (by scheduling things like washing machines to operate over night). If people are reminded that they saved money by using a night-time tariff, they’re more likely to schedule their machines to operate in the night in the future.
Isn’t This All Just Common Sense?
That’s a big question. And the answer might be yes. A lot of what’s been swept up into the world of nudging and the wider world of behavioral economics has been fairly well known for quite some time. The sales, marketing and advertising professions have been using this knowledge for a long time, as have many other professions and industries.
However, just because a lot of it is common sense doesn’t mean it’s not important. Understanding, analyzing and quantifying the effectiveness of different interventions is helpful, as is creating a common language that people can use in relation to this field.
Increasingly, products are also design to be persuasive, as it were. They are designed to create habits and drive increased use. Examples of this include Fogg’s model and the Hook model of behavioral design. You can listen to our podcast on this topic below.
The World of Work Project View
You can read more about our thoughts on Nudging itself in our post on that topic.
Overall, we think that nudging, and all aspects of behavioral science, are fascinating. We think there are some great uses for it that are truly benevolent both in the world of work and in the wider world. However, we think that the concepts behind behavioral science are often misused.
Because these 10 Important Nudges and other principles are often misused, we think it’s important for people to learn about them. When they do so, we believe they have a better chance of understanding when others are trying to influence them in ways that do not increase their own welfare.
Our Podcast is a great way to learn more about hundreds of fascinating topics from around the world of work.
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