Consumer perspective

This page consist information about nudge marketing, approached from a consumer perspective. It answers questions like: ‘What is bounded rationality?’, ‘How is bounded rationality related to nudge marketing?’ and ‘What is the CAN approach?’. There are a lot of examples included to give an idea of how nudging can be used to support behavioural change.

Bounded rationality

Economists see people as rational beings (Mueller, 2014). As psychologists would say: we make decisions based on system 2 thinking (Kahneman, 2011). But we operate in a complex way: our behaviour and interactions are not only navigated by rationality. Sometimes we do not have (access to) the right information to come to a proper decision or we have a shortage in willpower. It can also occur that we have limited resources: we lack time or money to come to the right decision. In all these situations we cannot rely on our own logic anymore. Instead, we make use of rules of thumb to come to a decision - we use system 1 reasoning (Kungl. Vetenskapsakademien, 2017; Riley, n.d.; Kahneman, 2011). When this occurs, we refer to bounded rationality (Lodge & Wegricht, 2016).

Bounded rationality can have a negative influence on the way you make decisions, but the good news is that we can guide people’s behaviour by using a nudge policy, so people will act rationally (Davis, 2014). When you for example want to help employees to eat a healthier lunch, you can use a lot of different ways to accomplish this goal. You could explain what a healthy lunch exactly is, you could increase the price of unhealthy food or you could even prohibit the sale of unhealthy food. These are all examples of how you can help employees eat a healthier lunch. But when you make sure that unhealthy food is difficult to reach and all healthy food is on eye level, you are using a nudge to support a healthy lunch (Dreze et al, as cited in Vos, 2015). An example of how a shelve could be organized to nudge people towards choosing healthy food is on the right.

Figure 1. Healthy food on the top shelves vs. unhealthy food on the bottom shelves

The CAN approach

As the example above shows, there are a lot of different ways in which you can influence someone’s eating behaviour, with or without the use of a nudge. One approach that you can use as a guidance when changing your food choices is the CAN approach. This approach helps you to choose healthier food, without changing the food options themselves (Wansink, 2015).

Figure 2. The CAN approach to changing one’s food choice.

As Figure 2 shows, the CAN approach consists of three elements. It states that:

First, healthy food has to be Convenient. You have to make sure that healthy food is the easiest and most convenient choice for a person. The way food is offered has of big impact on someone’s decision. If it is easy to see, order, pick up or consume, this food will be chosen over any other food. An example of how convenience to order can positively impact your health is given in the study of Thorndike et al (2012). When you place healthy products on eye-level, you will increase the sales of healthy products.

Second, healthy food has to be Attractive. If the food an attractive name, an attractive look, an attractive price or attractive taste expectations, it will be preferred over any other food. An example of how using an attractive name can increase healthy food sales is the study of Wansink et al (2012). For this experiment they wanted to increase the vegetable intake in schools by giving vegetables an attractive name, like “X-ray Vision Carrots” instead of simply “The food of the day”. This resulted in an increase of the sales of healthy dishes.

Also the piano stairs that are mentioned on the home page is a great example of how something that looks attractive can nudge you to take the stairs more often instead of using the escalator.

Figure 3. X-ray Vision Carrots

Figure 4. Piano stairs in Stockholm, Sweden

At last, healthy food has to be Normal to select. Most people prefer a popular option, which seems normal to choose. If a product is normal to order, purchase, serve or eat, this product will be chosen more often. A common used method to influence people’s behaviour is using a default option. The default option is the standard option that is presented without changing anything. We have the tendency to stick with the default option instead of making any changes (Borghans & Golsteyn, 2014).

An example of a study where they use a default option to nudge people towards making a healthier decision is the study of van Kleef et al (2018). When they used brown bread as default option, 94 percent of the participants stuck with the default option. When offering white bread as default option, 84 percent stuck with this option. This study shows very well that the way you present something can really influence the way we eat.

Another well-known example that uses default options to nudge people is what countries like Austria, France and Hungary do to increase the organ donor rates in their county. They use an opt-out default instead of an opt-in default. The video on the right shows that the correct use of a default option can make huge differences.

Conclusion

We can change people’s behaviour through the use of nudges. A method like the CAN approach is a great tool that can be used to support behavioural change. By combining the three elements of the CAN approach – Convenient, Attractive and Normal – you are able to positively stimulate someone to make changes in their behaviour; you are ‘nudged’ in the right direction.

References:Borghans, L., Golsteyn, B.H.H. (2014). Default options and training participation. Empirical economics, 46(4), 1417-1428.Daily Orbit. (2009). Daily Orbit – X-Ray vision carrots [Video file]. Retrieved from http://monkeysee.com/daily-orbit-x-ray-vision-carrots/Davis, J.B. (2014). Bounded rationality and bounded individuality (Department of Economics Working Paper 2014-03). Retrieved from https://epublications.marquette.edu/cgi/viewcontent.cgi?article=1034&context=econ_workingpapersKahneman, D. (2011). Thinking fast and slow. London, UK: Allen Lane Kungl. Vetenskapsakademien (2017). Richard Thaler’s contribution to behavioral economics. Retrieved from https://www.nobelprize.org/nobel_prizes/economic-sciences/laureates/2017/advanced-economicsciences2017.pdfLodge, M., Wegricht, K. (2016). The rationality paradox of nudge: Rational tools of government in a world of bounded rationality. Wiley online library, 38(3).Mueller, P.D. (2014). An Austrian view of expectations and business cycles. The review of Austrian economics, 27(2), 199-214.Riley, G. (n.d.) Difference between rationality and bounded rationality [Video file]. Retrieved from https://www.tutor2u.net/economics/reference/difference-between-rationality-and-bounded-rationality Thorndike, A.N., Sonnenberg, L., Riis, J., Barraclough, S., Levy, D.E. (2012). A 2-phase labeling and choice architecture intervention to improve healthy food and beverage choices. American journal of public health, 102(3), 527-533.Van Kleef, E. (2013). Food intake control. Blog on the psychology behind self-control, food intake, exercise, weight and mindless eating [Photograph]. Retrieved from http://foodintakecontrol.blogspot.nl/2013/01/impulsive-snacking-at-checkout-counter.htmlVan Kleef, E., Seijdell, K., Vingerhoeds, M.H., de Wijk, R.A., van Trijp, H.C.M. (2018). The effect of a default-based nudge on the choice of whole wheat bread. Appetite, 121, 179-185.Vogellus, K.J. (2009). Piano Stairs – Behind the scenes [Photograph]. Retrieved from https://www.flickr.com/photos/kj_/3669721910Volle, J. (2016). Crazy ways default options change your thinking [Video file]. Retrieved from https://www.youtube.com/watch?v=CgBiRXPEEzUVos, G. (2015). Nudging healthier food choices in the supermarket (Master’s thesis, Wageningen UR, the Netherlands). Retrieved from http://edepot.wur.nl/366376Wansink, B. (2015). Change their choice! Changing behaviour using the CAN approach and activism research. Psychology & Marketing, 32(5), 486-500.Wansink, B., Just, D.R., Payne, C.R. (2012). Attractive names sustain increased vegetable intake in schools. Preventive medicine, 55(4), 330-332.
Image references:[Limiting Interest Payment Deduction Will Only Hurt Consumers]. Reprinted from Consumer Action for a Strange Economy. The Free- Market for America’s by CAS 2017, retrieved from http://caseforconsumers.org/2017/10/06/case-op-ed-limiting-interest-payment-deduction-will-only-hurt-consumers/#prettyPhotoConsumers [Healthy food on the top shelves vs. unhealthy food on the bottom shelves]. Reprinted from Food intake control. Blog on the psychology behind self-control, food intake, exercise, weight and mindless eating, by E. van Kleef, 2013, retrieved from http://foodintakecontrol.blogspot.nl/2013/01/impulsive-snacking-at-checkout-counter.html The CAN approach to changing one’s food choice. Reprinted from “Change their choice! Changing behaviour using the CAN approach and activism research” by B. Wansink, 2015, Psychology & Marketing, 32(5), 486-500.[X-ray Vision Carrots]. Reprinted from Daily Orbit – X-Ray vision carrots [Video file] by Daily Orbit, 2009, retrieved from http://monkeysee.com/daily-orbit-x-ray-vision-carrots/[Piano stairs in Stockholm, Sweden]. Reprinted from Piano Stairs – Behind the scenes. K.J. Vogellus, 2009, retrieved from https://www.flickr.com/photos/kj_/3669721910

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