June, 2014 Newsletter
Interview conducted by Ideas To Go Chairman Ed Harrington on January 17, 2014
As a creative process business, we often find ourselves thinking about thinking. We’ve most recently been discovering new insights from both academia and science about behavioral economics and cognitive bias, neuroscience and innovation, as well as Big Data. Continuing our discovery, we spoke with a researcher in the field of persuasion and decision making. With our partnership with the Yale Center for Customer Insights, Ideas To Go facilitator and chairman Ed Harrington recently interviewed Zoë Chance, Assistant Professor of Marketing at the Yale School of Management—where she teaches Mastering Influence and Persuasion, advises Center for Customer Insights consulting and research teams, and collaborates with Optum Health.
Watch a short video of highlights from the interview here - then read more about the conversation below.
Ed: Tell us a little about what your area of research and study is—as well as the path that brought you to this area?
Zoë: After I got my MBA at USC in Los Angeles, and was a Brand Manager at Mattel, I wanted to use marketing in service of the greater social good. So I came back to school, and got my doctorate in decision making and social welfare—which helped me get my dream job here at Yale. I work on research we can use to help people be happier, be healthier, and help a lot with food and behavior. We help people “be healthy by accident.”
Ed: So, tell me a little bit more about the area of behavioral economics, and why you chose that as your area of study.
Zoë: When I went back to graduate school, I was interested in persuasion. So I started working with Dan Ariely on some projects about behavioral economics—and was really excited about it. I think it takes a lot for people to resist temptation—it takes a lot of willpower. So anything we can do to help people make better choices easily, without having to consciously decide to make those choices—or use up their willpower—are promising areas for improving some social problems.
Ed: Can you give me an example of some studies?
Zoë: First let me tell you about somebody else's study, to give you a background for this type of work. There was a group who did some research on Israeli judges—looking at parole decisions throughout the course of the day. They found that the prisoners who came up for parole at the beginning of a session had a better chance of getting paroled. But the judges would then become fatigued. By the end of the session, or before a meal break, nobody was getting paroled. This happened consistently over many sessions—many judges, many parolees. This is an example where the judge is supposed to be impartial, and is trying to do the right thing. But even trying to do the right thing, they're being affected by their environment of being tired and hungry.
Ed: Do you think, when it comes to behavioral economics, people often have an "opt-in / opt-out" mentality to things? Take, for example, a 401K. If people have to opt-out to participate, they’re more likely to do so—as opposed to if they have to opt-in. Is it about how easy the choice is?
Zoë: I think that “easiness” is exactly what ties together a lot of behavioral economics research—and most nudges are about making the better choice easier to do. So instead of people trying to remember, "I'm supposed to save money in my 401K," or "I'm supposed to not snack," it just paves the way for making the best choice the easiest choice.
Ed: Do you think making certain choices easier ends up taking choice away from people? “Now, we're going to remove the bad things from you, and we're going to put these other things in.” Do you ever think of this as an issue of force?
"Everything you do to create [an] environment is going to affect the way people make choices. You can do it intentionally, or you can do it unintentionally."
Zoë: Yes, I think there's a lot of discussion about libertarian vs. paternalism, and which is heavier—the paternal or the libertarian part? My belief is that when we're creating environments for choice—whether it’s a physical environment like a break room or cafeteria, or a sheet of paper where you're deciding whether to join a 401K—everything you do to create that environment is going to affect the way people make choices. You can do it intentionally, or you can do it unintentionally. If you have the opportunity to do it intentionally, you can affect people's choices by making it as random as possible—or you could say, "I'd like to help people out." I'm excited to help people out—it's close to my heart. And these are nudges—when you're trying to get people to join a 401K, nobody's saying that you have to. I think the key thing is not taking away choices. If you start to take away options that they like—if you take M&Ms out of the break room, for example—then you’re going to have social upheaval and revolution.
Ed: So having choices matter with a little more empowerment, because I’m making them—but you’re there to help them make the right choice.
Zoë: So you can consciously make the worst choice if you want, but perhaps unconsciously be nudged toward making a better choice.
Ed: And do people usually know the right choice?
Zoë: I don't know. What do you think?
Ed: Well I think if there's a bowl of M&Ms, and there's a bowl of yogurt chips, people know the yogurt will be better for them—but they are still probably going to be tempted by the M&Ms. But they have the choice to make.
Zoë: I'm curious about it. Some people might tell you that yogurt chips are perhaps healthier than M&Ms, but M&Ms might still be the right choice at times. I don't think it's wrong to indulge sometimes. I think it's a matter of how often you do it, and in what quantity. So it's really hard to know, in a particular moment, what choice is best for another person.
Ed: Does denying access to good make it more tempting? So, for instance, we say, "I'm sorry. You can't participate in the 401K," because of X reason, vs. “It's open to everybody. Come if you want to?”
Zoë: I think that this is a great idea because we know that scarcity works in marketing and advertising. If you say "limited time only," or "while supplies last," people tend to jump on those items. I love the idea of trying to restrict healthy foods or a 401K—I know I do this with my daughter all the time. Sometimes when I want her to eat some healthy food on her plate I'll say, "Oh, I'll take the rest of that!" and she'll say, "No!" But we haven't tried an experiment like this with adults. It would be interesting. But in some cases, if you makes things just a little bit more difficult, there are some people that might try harder, and then maybe stick with something longer.
Ed: Talk to me about what's going on that's really exciting and new. What's really catching your attention these days?
Zoë: I'll tell you something fun that I'm reading right now. It’s a book called The Game. This is the bible of pick-up artistry, and a great study on human psychology. It's really well-written by Neil Strauss—who was a successful journalist, but very unsuccessful with women. He didn't have the confidence, or any of the physicality, to have women falling at his feet. So he decided he was going to infiltrate the underground world of pick-up artists to learn what they do, and write about them. And during this process, he became one of the most famous pick-up artists in the world. This book lays out all the tools of the trade. He talks about indicators of interest, and the cues to let you know whether somebody's willing to let you go to the next level. In a pick-up situation, it might be asking for her phone number—but in a business persuasion situation, it might be asking for the sale, and seeing if you can follow up with them.
Ed: How do you define an insight?
Zoë: I define an insight as a discovery or fact, which you didn’t know before, that can affect your behavior in the future.
Ed: Can you give me a couple of examples?
Zoë: One is a project that I worked on with another MBA team. We're working in partnership with Optum Health, and they were interested in helping people eat healthier at home. So the MBA team went into many people's homes, and they took pictures of everywhere they kept their food: their refrigerators, cabinets, shelves, and counters. When we put these pictures together at the end, it dawned on us that the foods in the refrigerator were healthy foods—and the foods in the cabinets, pantries, and on the counter were much less healthy. It follows the advice people tell you at the grocery store: shop around to edges of the store, instead of the inside aisles. So the insight is: when people are looking to make a meal, they go to the fridge. But when people are looking for a snack, they tend to open the cabinets. If you could train yourself to open up the fridge when you want a snack, instead of the cabinet, then you wouldn’t have to exercise a lot of willpower to eat something healthy.
A piece of someone else’s research I'm excited about is my friends Katie Milkman and Julia Minsen at Wharton, who are working on a project they call temptation bundling. They're trying to get people to go to the gym more often by giving them pulpy fiction audio-books to listen to—but only at the gym. Books like The Hunger Games, Twilight, Harry Potter, or something like that. So there’s an iPod that you can check out at the gym, and you can listen to these novels while you're working out—but then you leave it—and you can't hear what happens next, until you come back to the gym.
Ed: And do you find that providing some self-indulgence is the right way to do things—if it gets them to participate in the behavior?
Zoë: I love the idea of combining indulgences and doing the right thing, because helping people to be happy is important. But helping them be healthy AND be happy is also important.
Editor's note: The transcript of this interview, for the purposes of this article, has been edited for length and clarity.
Zoë Chance is an Assistant Professor of Marketing, and advises Center for Customer Insights consulting and research teams at Yale School of Management.
Ed Harrington is Chairman of Ideas To Go, an innovation agency that works with Fortune 500 companies in ideation and concept development to incorporate the voice of the consumer. He also sits on the Advisory Board for the Yale Center for Customer Insights.
©2014 Ideas To Go, Inc. All rights reserved.
Ed Harrington is CEO and Innovation Process Facilitator at Ideas To Go, an innovation agency that works with Fortune 500 companies to incorporate the voice of the consumer in ideation and concept development. He co-authored the book, "Outsmart Your Instincts: How the Behavioral Innovation Approach Drives Your Company Forward."