15 Behavioural Economics Principles to increase ConversionsSiteVisibility
This presentation demonstrates the value of understanding and using a variety of behavioural economics principles to achieve results in your digital marketing campaign.
15 Behavioural Economics Principles to increase ConversionsSiteVisibility
This presentation demonstrates the value of understanding and using a variety of behavioural economics principles to achieve results in your digital marketing campaign.
This was a presentation I did on Malcolm Gladwell's Blink 4 years ago in University. There are some points missing that were presented verbally, but it's still an interesting summary on a fantastic book.
Aspiration, confidence, fear of failure and trust play a role in the B2B buying mindset. It sounds obvious, but avoidance of risk is a key component of business continuity and it’s easy to forget that B2B buyers are human beings, rather than rational decision-making robots. Brands need to invest time in understanding how their audience makes decisions if they are to influence them
Social media and data analytics are coming together to create a new world - one that combines human creativity with information technology to deliver power beyond imagination.
Do you know how to use Behavioural Economics? It's a game changer. Many researchers and marketers talk about this new way of uncovering deeper, more meaningful insights – but do you actually know how to apply it?
Behavioral Economics as a Lens for Interaction designPaul Sas
Interaction designers craft experiences by curating the flow of information within contexts that aim to focus attention and interest. Subtle psychological details can dramatically transform an experience. Experimental results from behavioral economics spotlight opportunities for improving the dynamics of an interaction: The presentation frame can harness intrinsically motivating cues, drive engagement, and enable people to develop behavioral patterns that harmonize with their deepest aspirations.
http://www.baychi.org/calendar/20120214/
a new copy testing research tool for measuring advertising effectiveness. A fresh approach to advertising research and communications testing by MM-Eye
Influence Strategies for Software ProfessionalsTechWell
You’ve tried and tried to convince people of your position. You’ve laid out your logical arguments on impressive PowerPoint slides—but you are still not able to sway them. Cognitive scientists understand that the approach you are taking is rarely successful. Often you must speak to others’ subconscious motivators rather than their rational, analytic side. Linda Rising shares influence strategies that you can use to more effectively convince others to see things your way. These strategies take advantage of a number of hardwired traits: liking—we like people who are like us; reciprocity—we repay in kind; social proof—we follow the lead of others similar to us; consistency—we align ourselves with our previous commitments; authority—we defer to authority figures; and scarcity—we want more of something when there is less to be had. Join Linda to learn how to build on these traits as a way of bringing others to your side. Use this valuable toolkit in addition to the logical left-brain techniques on which we depend.
You’re a project manager and you’ve just been given an Agile project to look after. You ask for reports and you get burndown charts, velocity graphs, and cumulative flow diagrams. What in the world are these, and why do you suddenly have a migraine headache? Metrics are different in Agile, but the questions remain the same. Come and see what your brain needs to understand the tracking of products built in an Agile way. We’ll build an Agile dashboard that you can take into your next meeting.
Wayne Hetherington
Farah Henley
Thinking:People are doing it wrong! Digital Elite Camp presentation. How cognitive biases and mental heuristics help to sell more. https://www.dreamgrow.com/thinking-cognitive-biases-in-sales-and-marketing/
Critical Analytical ThinkingPart II Heuristics and Bias.docxannettsparrow
Critical Analytical Thinking
Part II: Heuristics and Biases
Dr. Abdelghani Es-Sajjade
[email protected]
Overview
The law of small numbers
Cause and chance
Anchors
Availability heuristic
The public and the experts
Representativeness
Causal stereotypes
Regression to the mean
A two-systems view of regression
The law of small numbers
Observations
The counties in which the incidence of kidney cancer is lowest are mostly rural, sparsely populated in the Midwest, the South, and the West
Why? The clean living of the rural lifestyle. No air pollution, no water pollution, fresh food without additives.
Observations
The counties in which the incidence of kidney cancer is highest are mostly rural, sparsely populated in the Midwest, the South, and the West
Why? Poverty of rural lifestyle—no access to good medical care, too much alcohol, too much tobacco.
Our mind & statistics
Explanation has nothing to do with rural life
System 1 excels in one form of thinking: it automatically and effortlessly establishes causal connections between events…
even when supporting data is minimal or totally absent
We are insensitive to sample size or reliability of data.
Sample of 150 or 3000, who cares?
Why? WYSIATI and system 1 is gullible.
Our mind & statistics
We know about sample size!
But often can’t help ourselves.
Did you initially notice “sparsely populated”?
What is the difference?
Large samples are more precise than small samples.
Small samples yield extreme results more often than large samples do.
Hence, small counties, less people so …?
Certainty & doubt
Our mind has a preference for sliding into certainty over maintaining doubt
System 1: rich image with poor evidence
Even in science:
Small sample experiment, complex phenomenon.
Exercise 1
Cause & Chance
We have an inclination to causal thinking
Statistics is different because it focuses on what could have happened instead
The null-hypothesis
Randomness sometimes appears as a pattern
Hot hand: 3 or 4 scores in a row
basketball hot hand, team of players who scores 3 or 4 times in a row is now given more passes and extra defended. Research: this sequence of successes and missed shot fits all the conditions of random. The hot hand is in the eye of the beholder. Massive and widespread cognitive illusion.
11
Speaking of the Law of Small Numbers
“Yes, the studio has had three successful films since the new CEO took over. But it is too early to declare he has a hot hand.”
“The sample of observations is too small to make any inferences. Let’s not follow the law of small numbers.”
“I plan to keep the results of the experiment secret until we have a sufficiently large sample. Otherwise we will face pressure to reach a conclusion prematurely.”
Anchors
Anchoring effect: considering a particular value from an unknown quantity before estimating that quantity
Question: was Ibn Taymiyyah younger or older than 114 years old when he passed away?
What is the anchor? 114 years old.
You.
This was a presentation I did on Malcolm Gladwell's Blink 4 years ago in University. There are some points missing that were presented verbally, but it's still an interesting summary on a fantastic book.
Aspiration, confidence, fear of failure and trust play a role in the B2B buying mindset. It sounds obvious, but avoidance of risk is a key component of business continuity and it’s easy to forget that B2B buyers are human beings, rather than rational decision-making robots. Brands need to invest time in understanding how their audience makes decisions if they are to influence them
Social media and data analytics are coming together to create a new world - one that combines human creativity with information technology to deliver power beyond imagination.
Do you know how to use Behavioural Economics? It's a game changer. Many researchers and marketers talk about this new way of uncovering deeper, more meaningful insights – but do you actually know how to apply it?
Behavioral Economics as a Lens for Interaction designPaul Sas
Interaction designers craft experiences by curating the flow of information within contexts that aim to focus attention and interest. Subtle psychological details can dramatically transform an experience. Experimental results from behavioral economics spotlight opportunities for improving the dynamics of an interaction: The presentation frame can harness intrinsically motivating cues, drive engagement, and enable people to develop behavioral patterns that harmonize with their deepest aspirations.
http://www.baychi.org/calendar/20120214/
a new copy testing research tool for measuring advertising effectiveness. A fresh approach to advertising research and communications testing by MM-Eye
Influence Strategies for Software ProfessionalsTechWell
You’ve tried and tried to convince people of your position. You’ve laid out your logical arguments on impressive PowerPoint slides—but you are still not able to sway them. Cognitive scientists understand that the approach you are taking is rarely successful. Often you must speak to others’ subconscious motivators rather than their rational, analytic side. Linda Rising shares influence strategies that you can use to more effectively convince others to see things your way. These strategies take advantage of a number of hardwired traits: liking—we like people who are like us; reciprocity—we repay in kind; social proof—we follow the lead of others similar to us; consistency—we align ourselves with our previous commitments; authority—we defer to authority figures; and scarcity—we want more of something when there is less to be had. Join Linda to learn how to build on these traits as a way of bringing others to your side. Use this valuable toolkit in addition to the logical left-brain techniques on which we depend.
You’re a project manager and you’ve just been given an Agile project to look after. You ask for reports and you get burndown charts, velocity graphs, and cumulative flow diagrams. What in the world are these, and why do you suddenly have a migraine headache? Metrics are different in Agile, but the questions remain the same. Come and see what your brain needs to understand the tracking of products built in an Agile way. We’ll build an Agile dashboard that you can take into your next meeting.
Wayne Hetherington
Farah Henley
Thinking:People are doing it wrong! Digital Elite Camp presentation. How cognitive biases and mental heuristics help to sell more. https://www.dreamgrow.com/thinking-cognitive-biases-in-sales-and-marketing/
Critical Analytical ThinkingPart II Heuristics and Bias.docxannettsparrow
Critical Analytical Thinking
Part II: Heuristics and Biases
Dr. Abdelghani Es-Sajjade
[email protected]
Overview
The law of small numbers
Cause and chance
Anchors
Availability heuristic
The public and the experts
Representativeness
Causal stereotypes
Regression to the mean
A two-systems view of regression
The law of small numbers
Observations
The counties in which the incidence of kidney cancer is lowest are mostly rural, sparsely populated in the Midwest, the South, and the West
Why? The clean living of the rural lifestyle. No air pollution, no water pollution, fresh food without additives.
Observations
The counties in which the incidence of kidney cancer is highest are mostly rural, sparsely populated in the Midwest, the South, and the West
Why? Poverty of rural lifestyle—no access to good medical care, too much alcohol, too much tobacco.
Our mind & statistics
Explanation has nothing to do with rural life
System 1 excels in one form of thinking: it automatically and effortlessly establishes causal connections between events…
even when supporting data is minimal or totally absent
We are insensitive to sample size or reliability of data.
Sample of 150 or 3000, who cares?
Why? WYSIATI and system 1 is gullible.
Our mind & statistics
We know about sample size!
But often can’t help ourselves.
Did you initially notice “sparsely populated”?
What is the difference?
Large samples are more precise than small samples.
Small samples yield extreme results more often than large samples do.
Hence, small counties, less people so …?
Certainty & doubt
Our mind has a preference for sliding into certainty over maintaining doubt
System 1: rich image with poor evidence
Even in science:
Small sample experiment, complex phenomenon.
Exercise 1
Cause & Chance
We have an inclination to causal thinking
Statistics is different because it focuses on what could have happened instead
The null-hypothesis
Randomness sometimes appears as a pattern
Hot hand: 3 or 4 scores in a row
basketball hot hand, team of players who scores 3 or 4 times in a row is now given more passes and extra defended. Research: this sequence of successes and missed shot fits all the conditions of random. The hot hand is in the eye of the beholder. Massive and widespread cognitive illusion.
11
Speaking of the Law of Small Numbers
“Yes, the studio has had three successful films since the new CEO took over. But it is too early to declare he has a hot hand.”
“The sample of observations is too small to make any inferences. Let’s not follow the law of small numbers.”
“I plan to keep the results of the experiment secret until we have a sufficiently large sample. Otherwise we will face pressure to reach a conclusion prematurely.”
Anchors
Anchoring effect: considering a particular value from an unknown quantity before estimating that quantity
Question: was Ibn Taymiyyah younger or older than 114 years old when he passed away?
What is the anchor? 114 years old.
You.
SEMPL20 - ATANAS RAYKOV, Head of Global Telecom Partnerships & Director Busin...Sempl 21
The Next Stage for Personal Messaging
Messaging is about having more immediate, secure and personal communication with larger groups formed by common interest, belief or need.
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The day after Tomorrow
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Competition makes us faster. Collaboration makes us better.
Young Slovenian fashion designer Nina Šušnjara will talk about her creative partnerships with prominent brands.
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Media is dead. Long live the media!
A new Readership and readers survey clearly demonstrates that the reach of various media is quite different from the advertisers' opinion.
SEMPL20 - Barbara Krajnc: Experienced Public Affairs Consultant/Certified Fac...Sempl 21
Serious or Play? It’s time for both. It’s time for LEGO® SERIOUS PLAY®
LEGO® SERIOUS PLAY® teaches us a 100 % collaboration, open communications, creative thinking, respect of others and their knowledge, skills and expertise.
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We Are Not in Kansas Anymore: New Business Models in the Region
What are the new business models that have enabled the media to survive in a completely new environment.
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Paying (for) attention: how eye tracking reveals the reality of attention to advertising across media
Insights from eye tracking show the reality of online advertising: 80% of it is ignored.
SEMPL 19: ANDREAS SCHWABE, CEO, Blackwood Seven GermanySempl 21
The future media agency is not an agency
20 years ago, an average media plan took around 50 decisions to make. Today, it is more like 5.000. Without an artificial intelligence, you cannot longer keep up. Let's face the truth, the game is changing, transparency counts more than trust and media agencies must re-think their business. Andreas will show you how A.I. can already be successfully integrated into the strategic media planning and how it can allow as to make smarter, data driven decisions in order to maximize ROI across our marketing mix.
SEMPL 19: NICK BICANIC, Founder of RVLVR USASempl 21
OK. So there are no more screens. Now what?
What happens when media moves beyond the "frame" - be it a television, movie-screen, tablet or phone? What do stories become? How do brands engage with them? Is this the end of mass media or just another beginning? If you think screens are going to disappear what can you do today to prepare? Or should you just cross your fingers and hope that your existing business model will still be there in 3 to 5 years? Nick Bicanic will talk about the future of frameless media.
SEMPL 19: SUSIE DENT, TV Presenter and Lexicographer UKSempl 21
Words at Work (And Words that Don’t Work at Work)
The words we choose matter. In the space of one sentence, an audience can decide whether to tune in or tune out, just as a single slogan can change our perception of a product forever. Susie would like to try to illuminate the areas where marketers can get things spectacularly wrong, and suggest how they can make them dramatically right, all thanks to the vocabulary they choose. Electing the right form of language costs nothing but can pay remarkable dividends.
She’ll also be discussing jargon and how, contrary to all expectations, it can be a force for the good, providing it’s used in the right way!
Throughout, Susie will be drawing on examples from various industries of language that worked, and the kind that really didn’t, and examining some case studies in which the addition of a simple phrase, to a request, dramatically changed the result. Each will, she hopes, demonstrate the saying that ‘words are free - it’s how you use them that may cost you’.
SEMPL 19: JAN JILEK, CEO, Dotmetrics CroatiaSempl 21
Trust, transparency and new normal
Viewability, relevant metrics, fake news, ad fraud… while counting conversions, likes and impressions, there are some major issues to be adressed.
SEMPL 19: BORSI ROGAN, Managing Director, Luna\TBWA Zagreb CroatiaSempl 21
Trust, transparency and new normal
Viewability, relevant metrics, fake news, ad fraud… while counting conversions, likes and impressions, there are some major issues to be adressed.
SEMPL 19: ROBERT SCHMITZER, Director of Digital Development, Delo Slovenia Sempl 21
Trust, transparency and new normal
Viewability, relevant metrics, fake news, ad fraud… while counting conversions, likes and impressions, there are some major issues to be adressed.
SEMPL 19: JOHN DALTON, Director of LSPR UK and LSPR Worldwide UKSempl 21
Why Modern Leadership Fails: Biology has the answer
Modern leadership is the most talked and written about topic in business - yet despite millions of articles and thousands of books and academic studies, there are still so many examples of failure in leadership in both commerce and politics - why? It is the most talked about and least understood academic topic. John's rationale is simple - business and management education has focused on outcomes and used military leadership as its base - this is outdated and now less useful. Few people have looked at evolutionary biology and neuroscience to provide a proper explanation of why we think as we do and why mismatches occur all the time. This talk is about putting the biology back into management and leadership.
Accelerate your Kubernetes clusters with Varnish CachingThijs Feryn
A presentation about the usage and availability of Varnish on Kubernetes. This talk explores the capabilities of Varnish caching and shows how to use the Varnish Helm chart to deploy it to Kubernetes.
This presentation was delivered at K8SUG Singapore. See https://feryn.eu/presentations/accelerate-your-kubernetes-clusters-with-varnish-caching-k8sug-singapore-28-2024 for more details.
State of ICS and IoT Cyber Threat Landscape Report 2024 previewPrayukth K V
The IoT and OT threat landscape report has been prepared by the Threat Research Team at Sectrio using data from Sectrio, cyber threat intelligence farming facilities spread across over 85 cities around the world. In addition, Sectrio also runs AI-based advanced threat and payload engagement facilities that serve as sinks to attract and engage sophisticated threat actors, and newer malware including new variants and latent threats that are at an earlier stage of development.
The latest edition of the OT/ICS and IoT security Threat Landscape Report 2024 also covers:
State of global ICS asset and network exposure
Sectoral targets and attacks as well as the cost of ransom
Global APT activity, AI usage, actor and tactic profiles, and implications
Rise in volumes of AI-powered cyberattacks
Major cyber events in 2024
Malware and malicious payload trends
Cyberattack types and targets
Vulnerability exploit attempts on CVEs
Attacks on counties – USA
Expansion of bot farms – how, where, and why
In-depth analysis of the cyber threat landscape across North America, South America, Europe, APAC, and the Middle East
Why are attacks on smart factories rising?
Cyber risk predictions
Axis of attacks – Europe
Systemic attacks in the Middle East
Download the full report from here:
https://sectrio.com/resources/ot-threat-landscape-reports/sectrio-releases-ot-ics-and-iot-security-threat-landscape-report-2024/
Why You Should Replace Windows 11 with Nitrux Linux 3.5.0 for enhanced perfor...SOFTTECHHUB
The choice of an operating system plays a pivotal role in shaping our computing experience. For decades, Microsoft's Windows has dominated the market, offering a familiar and widely adopted platform for personal and professional use. However, as technological advancements continue to push the boundaries of innovation, alternative operating systems have emerged, challenging the status quo and offering users a fresh perspective on computing.
One such alternative that has garnered significant attention and acclaim is Nitrux Linux 3.5.0, a sleek, powerful, and user-friendly Linux distribution that promises to redefine the way we interact with our devices. With its focus on performance, security, and customization, Nitrux Linux presents a compelling case for those seeking to break free from the constraints of proprietary software and embrace the freedom and flexibility of open-source computing.
zkStudyClub - Reef: Fast Succinct Non-Interactive Zero-Knowledge Regex ProofsAlex Pruden
This paper presents Reef, a system for generating publicly verifiable succinct non-interactive zero-knowledge proofs that a committed document matches or does not match a regular expression. We describe applications such as proving the strength of passwords, the provenance of email despite redactions, the validity of oblivious DNS queries, and the existence of mutations in DNA. Reef supports the Perl Compatible Regular Expression syntax, including wildcards, alternation, ranges, capture groups, Kleene star, negations, and lookarounds. Reef introduces a new type of automata, Skipping Alternating Finite Automata (SAFA), that skips irrelevant parts of a document when producing proofs without undermining soundness, and instantiates SAFA with a lookup argument. Our experimental evaluation confirms that Reef can generate proofs for documents with 32M characters; the proofs are small and cheap to verify (under a second).
Paper: https://eprint.iacr.org/2023/1886
Le nuove frontiere dell'AI nell'RPA con UiPath Autopilot™UiPathCommunity
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📕 Vedremo insieme alcuni esempi dell'utilizzo di Autopilot in diversi tool della Suite UiPath:
Autopilot per Studio Web
Autopilot per Studio
Autopilot per Apps
Clipboard AI
GenAI applicata alla Document Understanding
👨🏫👨💻 Speakers:
Stefano Negro, UiPath MVPx3, RPA Tech Lead @ BSP Consultant
Flavio Martinelli, UiPath MVP 2023, Technical Account Manager @UiPath
Andrei Tasca, RPA Solutions Team Lead @NTT Data
The Art of the Pitch: WordPress Relationships and SalesLaura Byrne
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All these questions and more will be explored as we talk about matching clients’ needs with what your agency offers without pulling teeth or pulling your hair out. Practical tips, and strategies for successful relationship building that leads to closing the deal.
LF Energy Webinar: Electrical Grid Modelling and Simulation Through PowSyBl -...DanBrown980551
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Then welcome to this PowSyBl workshop, hosted by Rte, the French Transmission System Operator (TSO)!
During the webinar, you will discover the PowSyBl ecosystem as well as handle and study an electrical network through an interactive Python notebook.
PowSyBl is an open source project hosted by LF Energy, which offers a comprehensive set of features for electrical grid modelling and simulation. Among other advanced features, PowSyBl provides:
- A fully editable and extendable library for grid component modelling;
- Visualization tools to display your network;
- Grid simulation tools, such as power flows, security analyses (with or without remedial actions) and sensitivity analyses;
The framework is mostly written in Java, with a Python binding so that Python developers can access PowSyBl functionalities as well.
What you will learn during the webinar:
- For beginners: discover PowSyBl's functionalities through a quick general presentation and the notebook, without needing any expert coding skills;
- For advanced developers: master the skills to efficiently apply PowSyBl functionalities to your real-world scenarios.
Encryption in Microsoft 365 - ExpertsLive Netherlands 2024Albert Hoitingh
In this session I delve into the encryption technology used in Microsoft 365 and Microsoft Purview. Including the concepts of Customer Key and Double Key Encryption.
Essentials of Automations: The Art of Triggers and Actions in FMESafe Software
In this second installment of our Essentials of Automations webinar series, we’ll explore the landscape of triggers and actions, guiding you through the nuances of authoring and adapting workspaces for seamless automations. Gain an understanding of the full spectrum of triggers and actions available in FME, empowering you to enhance your workspaces for efficient automation.
We’ll kick things off by showcasing the most commonly used event-based triggers, introducing you to various automation workflows like manual triggers, schedules, directory watchers, and more. Plus, see how these elements play out in real scenarios.
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Enhancing Performance with Globus and the Science DMZGlobus
ESnet has led the way in helping national facilities—and many other institutions in the research community—configure Science DMZs and troubleshoot network issues to maximize data transfer performance. In this talk we will present a summary of approaches and tips for getting the most out of your network infrastructure using Globus Connect Server.
Securing your Kubernetes cluster_ a step-by-step guide to success !KatiaHIMEUR1
Today, after several years of existence, an extremely active community and an ultra-dynamic ecosystem, Kubernetes has established itself as the de facto standard in container orchestration. Thanks to a wide range of managed services, it has never been so easy to set up a ready-to-use Kubernetes cluster.
However, this ease of use means that the subject of security in Kubernetes is often left for later, or even neglected. This exposes companies to significant risks.
In this talk, I'll show you step-by-step how to secure your Kubernetes cluster for greater peace of mind and reliability.
Securing your Kubernetes cluster_ a step-by-step guide to success !
The Good, the Bad and the Irrational – Understanding the Irrational Consumer (Gerhard Fehr, Fehradvice)
1. The Good, the Bad and the Irrational
Understanding the Irrational Consumer
Gerhard Fehr, Karoline Bauer
28 November 2013
2. How to use the Voting Devices
Do not press anything except the number you want to vote for, the answer will be
registered automatically.
In case you see “new channel?” on the screen, follow these steps:
1
Press
«Channel»-Button
3
Finally, press
«OK»
2
Insert the
number «41»
FehrAdvice & Partners AG, November 2013
2
3. Which table is longer?
FehrAdvice & Partners AG, November 2013
3
4. Which patch is darker?
Clearly, the upper
patch is brown
and the lower
patch is orange.
When all the rest
is stripped away,
we realize: they
are both the same
color!
FehrAdvice & Partners AG, November 2013
4
5. The power of perception (I/II)
1
Which of the three women do you find most attractive?
1. A
2. B
3. C
Philip Barden (2013), Decoded – The Science Behind Why We Buy, p. 69
0%
1
70% of all male respondents choose
0%
2
3
Our perceptual system is able to base
option B.
0%
decisions on extremely subtle
The secret lies in the hips/waist ratio:
differences.
0.67 is considered most attractive in a
indo-european culture
These differences can have a crucial
impact on the success of a product!
Devendra Singh and Robert K. Young (2001). Body Weight, Waist-to-Hip Ratio, "Breasts, and Hips: Role in Judgments of Female
Attractiveness and Desirability for Relationships
FehrAdvice & Partners AG, November 13
5
6. The power of perception (II/II)
2
Which of the two bottles holds more?
1. A
2. B
0%
0%
1
Consumers use the height of a product
as the primary signal for larger volume.
2
Win-win situation for marketers:
This influences their perception of
More purchases
value-for-money and at the same time
Faster consumption-rate
increases consumption.
Philip Barden (2013), Decoded – The Science Behind Why We Buy, p. 70
FehrAdvice & Partners AG, November 13
6
7. Please answer the following question
Griotte Praliné
€ 0.05
Lindt Praliné
€ 0.20
1
Which of the two chocolates would you prefer?
50%
50%
1. Griotte Praliné
2. Lindt Praliné
1.
2.
FehrAdvice & Partners AG, June 13
7
8. Please answer the following question
Griotte Praliné
free
Lindt Praliné
€ 0.15
2
Which of the two chocolates would you prefer?
50%
50%
1. Griotte Praliné
2. Lindt Praliné
1.
2.
FehrAdvice & Partners AG, June 13
8
9. The power of “0” contributes to the “zero price trap”
The price of 0 completely changes human decision-making
The power of
FREE!
Offers that are free lead to an affective/emotional reaction
People use this affective/emotional reaction as a decision criteria and choose
the free option – even if the other option is of significantly better quality and is
better value for money
In
versus
1
2
Which chocolate would you prefer?
Griotte Praliné
€ 0.05
30%
Lindt Praliné
€ 0.20
70%
Ariely, D. (2009). Predictably Irrational. New York: Harper Collins Publishers
Which chocolate would you prefer?
Griotte Praliné
free
Lindt Praliné
€ 0.15
69%
31%
FehrAdvice & Partners AG, June 13
9
10. Please answer the following questions (I/III)
1
A bat and a ball cost €1.10. The bat costs one Euro more than the ball. How much does the ball cost?
1.
2.
3.
4.
5.
€ 1.05
€ 1.00
€ 0.20
€ 0.10
€ 0.05
0%
1
0%
2
0%
3
0%
4
0%
5
FehrAdvice & Partners AG, November 13
10
11. Please answer the following questions (II/III)
4
5 machines need 5 minutes to produce 5 units. How long do 100 machines need to produce 100
units?
1.
2.
3.
4.
5.
1 minute
5 minutes
10 minutes
20 minutes
100 minutes
0%
1
0%
2
0%
3
0%
4
0%
5
FehrAdvice & Partners AG, November 13
11
12. Please answer the following questions (III/III)
5
A pond is covered in water lilies. Because the water lilies continue to form new leaves, the area
covered by them doubles each day.
If it takes 48 days until the water lilies cover the entire pond, how many days does it take to cover half
the pond?
1.
2.
3.
4.
5.
6 days
12 days
24 days
36 days
47 days
0%
1
0%
2
0%
3
0%
4
0%
5
FehrAdvice & Partners AG, November 13
12
13. People think in 2 different systems – on the one hand intuitively and impulsively,
on the other hand rationally and slowly
The previous questions are from Shane Frederick‟s Cognitive Reflection Test.
The right answers are as follows:
The ball costs 5 Cents (intuitively: 10 Rappen)
100 maschines need 5 minutes (intuitively: 100 minutes) to produce 100 products
It takes 47 days (intuitively: 24 days) until the water lilies cover half the pond
People think in two different
systems*:
System 1 is...
...intuitive,
...fast and
...impulsive.
System 1 causes people in certain situations to…
… be impatient
… have low self-control and
… display little stamina.
System 2 however is...
...rational,
...slow and
...lazy.
*Kahneman, D. (2011). Thinking, Fast and Slow.
System 2 can easily solve the previous questions, but it
often is not even involved in the decision.
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14. Even students of Ivy League Universities don’t have control over their system 1
Even the great majority of Ivy League
students don‟t answer these
questions correctly
This shows that not only cognitive skills
are key to this test, but mostly also
non-cognitive skills.
Thinking can be difficult.
Most people try to avoid difficulties if possible and will often make intuitive decisions instead
(system 1).
*Shane, F. (2005). Cognitive Reflection and Decision Making.
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15. The implications of explicit and implicit image for market research
Our product experience is
mostly influenced by implicit
processes, for example
expectations, implicit reference
points, etc.
If those are positive and
reference points are not
violated, brands and products
are more likely to be considered
by the consumer
We can draw one clear conclusion from this:
market research, based on cognitive decisions,
has very limited power.
*Kahneman, D. (2011). Thinking, Fast and Slow
Philip Barden (2013), Decoded – The Science Behind Why We Buy, p. 33
The only thing able to tell us
something reliable about consumer
behavior are close-to-reality
experiments
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16. What is a Brand?
And why does it matter?
Newspaper 1
RAIL TICKET
PRICES TO
DOUBLE NEXT
YEAR
Newspaper 2
RAIL TICKET
PRICES TO
DOUBLE NEXT
YEAR
Evidence shows that
media brands greatly
influence the credibility of
news items – more than
the actual content.
Brands are a type of overall frame for different products
It‟s not a question of „brand or
product‟, „sales or image‟,
„functional or emotional‟ benefit.
Brands provide a background
leading to a product‟s higher
perceived value.
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17. Lessons learned: Consumers behave pretty irrational
Latest behavioral economic research provides empirical insights about systematic human skills and abilities
These human skills and abilities need to be taken into account when analyzing behavior of employees and managers
People can only assess a limited
amount of information, systematically
overweigh losses compared to equal
gains and tend to be overconfident. For
instance, they cannot always assess
risks and often act according to
stereotypes. Thus, they often act in a way
that does not seem fully rational.
People‟s behavior is influenced by social
preferences. Emotional skills like
empathy influence how these social
preferences are put in action.
People
Human behavior is influenced by limited
willpower and limited self-control,
presence-biased time preferences as
well as heterogeneous levels of
motivation.
People have different social identities
(job, leisure, family) with different social
norms. The sense of belonging to a
social identity can overwrite social
preferences.
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18. The good and the bad consumer (I/III)
1
How ethically appropriate / inappropriate do you think the other people
in this room will judge…
… buying clothes at Abercrombie & Fitch?
1. Very inappropriate
2. Inappropriate
3. Neither nor
4. Appropriate
5. Very appropriate
0%
1
0%
2
0%
3
0%
4
0%
5
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19. The good and the bad consumer (II/III)
2
How ethically appropriate / inappropriate do you think the other people in this room will judge…
… concealing the actual content amount of a product through extensive packaging?
1. Very inappropriate
2. Inappropriate
3. Neither nor
4. Appropriate
5. Very appropriate
0%
1
0%
2
0%
3
0%
4
0%
5
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20. The good and the bad consumer (III/III)
3
How ethically appropriate / inappropriate do you think the other people in this room will judge…
…marketing sugary yoghurts as healthy snacks for kids?
1. Very inappropriate
2. Inappropriate
3. Neither nor
4. Appropriate
5. Very appropriate
0%
1
0%
2
0%
3
0%
4
0%
5
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21. No homogeneous values regarding ethical behavior can be observed
Some people might argue that…
1
… Abercrombie & Fitch
supports sexism and
superficiality by employing
tan, half-naked men with six
packs.
2
3
… concealing the product‟s
actual amount through
packaging is equal to lying to
the customer.
… marketing sugary yoghurt
as healthy for children is
contributing to the obesity
epidemic.
But homogeneous values about ethical behavior do rarely exist.
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22. Your ethics compared to others in the audience
3
How ethical do you judge your own behavior compared to that of the other people in this room?
1.
2.
3.
4.
5.
Very unethical
Unethical
Neither nor
Ethical
Very ethical
0%
1
0%
2
0%
3
0%
4
0%
5
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23. Overconfidence is a widespread phenomenon
People are systematically overconfident, which has tremendous impact on the decisions we make.
Overconfidence regarding own skills and capabilities:
As the questions demands a relative
consideration of the present audience, the
shares above and below average should be
equally big
Assumptions: a roughly normal distribution
A variety of empirical studies shows that
people systematically overestimate their skills
and performance
Men are more overconfident than women
(which can already be observed in childhood)
Wherever overconfidence applies, it is more
difficult to change behavior
++
+
Ø
-
--
Siehe Niederle, M. and Vesterlund, L. (2007). Do Women Shy Away From Competition? Do Men Compete Too
Much?
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24. Lessons learned
The good consumer
The bad consumer
1.
Our self-image
Reality (sometimes)
Irrational consumption
behavior
People think they are “good consumers”, however, sometimes “makes” bad decisions
2.
Marketers can design products in a way that consumers are “nudged”
into good decision making
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25. Non-binding Defaults and “green” consumer behavior – Example from the Energy Sector
Conversion Rate =
8.8%
Conversion Rate =
8.0%
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26. Choice Architecture plays a major role in the pricing policy (II/II)
The effect of Choice Architecture can be illustrated with the aid of the following example:
In a field experiment* participants were able to choose between different subscription offers for “The Economist”
When the choice was between web subscription only and print & web subscription, most participants chose web subscription only
With an additional, clearly inferior, choice that nobody chose, the previous preferences were changed completely
Subscriptions
Subscriptions
Pick the type of subscription you want to buy or
renew
Pick the type of subscription you want to buy or
renew
1. Web subscription
1. Web subscription
$59.00
2. Print subscription
$125.00
3. Print & web subscription
$125.00
2. Print & web subscription
$59.00
$125.00
68%
32%
16%
0%
84%
Because we find it difficult to assess the absolute value of different options, we rank them
relative to the available choices
*The experiment was conducted by Dan Ariely
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27. A
2.
How to change consumer behavior in an undesirable way: Introduction of a quarterly fee
does increase churn-rates considerably and decreases customer satisfaction
The annual fee will be replaced by a
quarterly fee and increased by 20% p.a.
...which increased the churn rate and decreased customer satisfaction
Resultate
Vorgehensweise
8%
+20%
%Churn
Customer Satisfaction
7%
120
6%
100
5%
4x
4%
+7 %Punkte
3%
2%
1%
Annual Fee
0%
Jahr 1
Framing to the customer:
The quarterly invoice of the fee increases
the flexibility of the customers, because
contract durations will be shorter
Control group
Kontrollgruppe*
Jahr 2
10
9
8
7
6
5
4
3
2
1
0
Quarterly fee
Quartalsgebühr
Explanation
The effects can be explained in the following way:
Consumer prefer one-off payments over multiple installment payments, because oneoff payments only „hurt“ once (loss-aversion, prospect theory).
The Framing of the increase is very important. The „hidden increase of the annual fee
via a split of the annual fee will, on average, be considered as unfair. Unfairness very
often triggers a „negative reciprocate behavior“, i.e. customers are willing to incur
own cost by harming the company (negative referral, churn ,etc. ). Additionally,
additional flexibility is „very seldom“ a sufficient argument for price increases.
-7%
Kontrollgruppe*
Control group
Quarterly fee
Conclusion
Loss-Aversion is the
main trigger for
customers in the case of
splitting annual
payments into multiple
installments.
This approach in order to
increase prices will not
be accepted by
customers.
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28. „Status loving“ Gold costumers have a willingness to pay a premium in
order to increase their privileges
A new status is introduced: „Gold Premium“ –
three months later the prices is increased
...which will be accepted by predominantly male consumers with high
income
Result of the choice architecture
Approach
Gold
Premium
Status
Annual
Fee
300 CHF
Income beyond 125„000 CHF
Contact
customer service
Männer
6.5%
91%
9%
7%
93.5%
93%
9%
Time
In a second step (after 3 months) the annual fee will be
increased – but only, if the customer will keep the new
level of status.
Income below 125„000 CHF
In a first step, a «Gold Premium Status» will be
introduced, which all Gold Costumers will receive
11%
Annahme
Opt-out
Frauen
16%
84%
89%
The increase of the annual fee will be introduced by an
opt-out structure
Explanation
The „Gold-Premium Status“ was given to all customers. The idea was to
create an „endowment-effect“. Consumers do not want to lose the status
and suffer „loss-aversion“. Due to this effect, overwhelming part of the
customers accept the price increase due to the fact, that they do not want
to lose the new privileges
This effect is considerably higher by male consumers with high income.
The opt-out (old status, old price) option was used in a modest frequency.
Conclusion
Status matters and has its price
Choice Architecture matters and has
low impact on customer
dissatisfaction.
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29. Putting the pieces together – lessons learned
•
Irrational consumer behavior is systematic and can be observed in different
cultures, markets or customer segments
•
Traditional market research asks the “pilot” and produces feedbacks that do not
reflect real consumer behavior in the real world
•
Overwhelming part of consumers believe, that their consumption behavior reflects
ethical standards, however, in the moment of truth, they regularly act against their
beliefs
•
Good and bad consumption behavior does mainly reflect choice architecture and
framing of campaigns and products
•
Marketing Managers can often design their products & campaigns in a way, that
consumers are “nudged” into better behavior, without harming business goals
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30. The management team of FehrAdvice consists of experts from science and practice
Univ. Prof. Ernst Fehr
Chairman of the Board
Harald P. Stoehr
Managing Partner
Gerhard Fehr
CEO and Managing Partner
Bergstrasse 114
8032 Zürich
Bergstrasse 114
8032 Zürich
Bergstrasse 114
8032 Zürich
Tel: +41 44 256 79 00
Tel: +41 44 256 79 00
Tel: +41 44 256 79 00
ernst.fehr@fehradvice.com
harald.stoehr@fehradvice.com
gerhard.fehr@fehradvice.com
FehrAdvice & Partners AG, November 2013
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31. Contact
FehrAdvice & Partners AG
Bergstrasse 114
8032 Zürich
info@fehradvice.com
www.fehradvice.com
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