This presentation looks at behavioural nudges used by different businesses. Nudges are interventions that preserve freedom of choice but that nonetheless influence people’s decisions. Our decisions are often heavily affected by behavioural biases, instinctively we favour the default option Choices are contextual and we are also deeply affected by social norms.

1. Playing Capitalism’s Long Game
Behavioural Nudges in a World
of Disruptive Technologies
Geoff Riley FRSA, June 2015

2. You have just a few seconds to write down an
answer to each of the following questions…..

3. In a lake, there is a patch of lily pads.
Every day, the patch doubles in size. If it
takes 48 days for the patch to cover the
entire lake, how long would it take for
the patch to cover half of the lake?

4. Mary’s Father has 5 daughters
The first four are Sante, Senti, Sinto and Sontu
What is the fifth one is called

6. A baseball and bat
together cost $11.
The bat costs $10
more than the ball.
How much does the
ball cost?

7. What is the 4th Emergency Service?

8. Boys
Look away from the
screen NOW!

9. Estimate this ….
1 x 2 x 3 x 4 x 5 x 6 x 7 x 8

10. Boys
Look at the screen
now

11. Estimate
8 x 7 x 6 x 5 x 4 x 3 x 2 x 1

12. Playing Capitalism’s Long Game
Behavioural Nudges in a World
of Disruptive Technologies
Geoff Riley FRSA, June 2015

13. In a lake, there is a patch of lily pads.
Every day, the patch doubles in size. If it
takes 48 days for the patch to cover the
entire lake, how long would it take for
the patch to cover half of the lake?
47 days

14. Mary’s Father has 5 daughters. The first four are
Sante, Senti, Sinto and Sontu
What is the fifth one is called Mary

15. 87

16. 87

17. A baseball and bat
together cost $11.
The bat costs $10
more than the ball.
How much does the
ball cost?
$0.50

18. What is the 4th Emergency Service?

20. Framing as a form of re-branding

21. Estimate
1 x 2 x 3 x 4 x 5 x 6 x 7 x 8
Median estimate = 512

22. Estimate
8 x 7 x 6 x 5 x 4 x 3 x 2 x 1
Median estimate = 2250

23. Actual answer is the same!
1 x 2 x 3 x 4 x 5 x 6 x 7 x 8
8 x 7 x 6 x 5 x 4 x 3 x 2 x 1
Answer = 40320

24. Playing Capitalism’s Long Game
Behavioural Nudges in a World
of Disruptive Technologies
Geoff Riley FRSA, June 2015

25. What are nudges?
• Nudges are interventions that preserve
freedom of choice but that nonetheless
influence people’s decisions
• Our decisions are often heavily affected by
behavioural biases
• Instinctively we favour the default option
• Choices are contextual
• We are deeply affected by social norms

26. Source: World Bank 2015

27. Genres of Behavioural Nudge
• Goal gradient effects
• Chunking
• Changing or reinforcing social norms
• Framing, Anchoring, Priming
• Changing the default choice option
• Commitment contracts
• Nudging through price incentives
• Harnessing the power of social networks

28. Save Paper
Do Small Nudges Work?

29. Which of
these two
loyalty
cards for a
car wash
is likely to
be most
effective?
A or B?
A
B

30. Choice Architecture Influences Us

31. Nudges for Homo distractus
Nudges to improve social graces

32. System 1 Thinking for Men!

35. 78

38. Priming and Framing

39. Nudging People to be more Polite

40. Appealing to Social Norms

41. A behavioural nudge to give blood

42. Market share of grocery stores in UK for 12 weeks ending March 29, 2015
28.4%
17.1%
16.4%
10.9%
6%
5.1%
5.3%
3.7%
2.1%
2.9%
2.1%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
Tesco
Asda
Sainsbury's
Morrisons
The Co-operative
Waitrose
Aldi
Lidl
Iceland
Other outlets
Symbols and Independent
Market share of total grocers
Grocers

43. Lidl knows that people hate waiting

44. Incentives to travel off-peak in Singapore

45. Humans hate uncertainty

46. Loss Aversion at the Supermarket

47. Building in a new Default Choice

49. Commercial exploitation of Scarcity Bias

50. Scarcity Bias with EasyJet – ethical?

51. Playing Capitalism’s Long Game
Behavioural Nudges in a World
of Disruptive Technologies
Geoff Riley FRSA, June 2015

52. • A hardware store has been selling snow
shovels for $15. The morning after a heavy
snowfall, the store raises the price to $20.
• On a scale of 1-10 how fair is this?
• 1: Totally unfair 10: Totally fair

53. Is it fair for a mostly-empty restaurant to offer a £20 discount
off the lunchtime bill for a table of four customers?

54. Is it fair for a busy restaurant to charge a £20 surcharge for
any group of people eating at 7.30pm on a Saturday?

55. After hurricane warnings what would you expect to
happen to the price of plywood and bottled water?

56. Top-3 US Tech Start-
Up Valuations
1. $50B Uber
2. $24B Airbnb
3. $20B Palantir

63. Nudging for Social Good and for Profit
• Many tech-savvy start-ups understand
behavioural biases
• They build clever “nudges” into their
marketing / pricing strategies
• But do they get the idea of playing capitalism’s
long game?
• Do they risk cutting across social norms and
inviting a strong regulatory response?

64. Genres of Behavioural Nudge
• Goal gradient effects
• Chunking
• Changing or reinforcing social norms
• Framing, Anchoring, Priming
• Changing the default choice option
• Commitment contracts
• Nudging through price incentives
• Harnessing the power of social networks

65. Opinion of organ donations in U.S. adults 1993-2012
Support for organ donation among U.S. adults in 1993, 2005, and 2012
93.5% 92.9% 94.9%
6.5% 4.4% 2.4%2.6% 2.7%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
1993 2005 2012
Percentageofrespondents
Strongly support/support Strongly oppose/oppose Don't know/refused

70. Playing Capitalism’s Long Game
Behavioural Nudges in a World
of Disruptive Technologies
Geoff Riley FRSA, June 2015