Why I adopted nudge theory and you should too
Nudge theory is based on the principle that small changes to messages can have a big impact on people’s behaviour. It can help organisations rethink how to increase take-up in services and encourage people to change their behaviours without directly instructing them to do so.
All of us will have experienced a nudge as we go about our day-to-day lives, even if we are not aware of it. From choosing to reuse a plastic bag rather than pay 5p for a new one, to picking more expensive food in a supermarket because it is placed at arm height, nudges are now more prominent than ever and with good reason.
Richard Thaler, one of the first architects of nudge, highlighted how tiny prompts can alter our behaviour. He was recently awarded the Nobel Prize for Economics.
He co-wrote ‘Nudge’ in 2008 outlining a set of principles that would the change the way we make decisions. “Nudge is about choices – how we make them and how we can make better ones. Every day we make decisions… Unfortunately, we often choose poorly.” In this seminal work, Richard demonstrates how to nudge us in the right direction, by guiding our behaviour.
The Nobel Prize judges clearly see the benefit in this discipline, since they awarded fellow behavioural economist Daniel Kahneman the Economics Prize in 2002. Nudge has gone from strength-to-strength since then. Today, trials are being conducted across the globe, with a greater focus on more complex behavioural challenges.
In one recent example, the proportion of savers visiting the Pension Wise website increased ten-fold when sent a one-sided ‘Pension Passport’ rather than the usual 50-100 page ‘wake-up’ pack.
In another example, text messages were sent to the nominated ‘study supporter’ of individual students resitting a GCSE subject suggesting questions they could ask to highlight key events for revision or encourage discussions about learning. Study supporters could be a family member of a friend tasked with helping the individual. Students whose study supporters received the text messages were 27 per cent more likely to pass their GCSEs.
Nudge – how it all started
In response to the early success of nudge approaches, David Cameron’s UK government decided to set up the Behavioural Insights Team, nicknamed the Nudge Unit, to run a series of experiments to test whether interventions designed to guide people’s behaviour would work.
The Nudge Unit ran dozens of experiments in its infancy, with promising results. One trial by HMRC, sent variations of a letter to 140,000 taxpayers asking them to pay their tax. A control letter was tested against one that included the statement ‘9 out of 10 people in Britain pay their tax on time’, as well as one mentioning that most people in the recipient’s local area or postcode had already paid their bill. This six week trial resulted in a 15 percentage point increase in tax paid on time. If the approach rolled out nationally, it was estimated that an extra £160 million of tax debts would be collected on time.
This was just one of the many successful experiments, proving that behavioural insights led to better outcomes, easier services for the public to use and saved money.
Why I adopted nudge
Around the same time I was working at Havering Council as its Campaigns and Marketing Manager. Like many other councils we were faced with a huge reduction in our budget, as we grappled with reduced funding from central government in the aftermath of the banking crisis.
Our answer was to look at how we could become more efficient and to focus on innovative ways to save money and deliver services, particularly where there was scope to share services, such as HR, finance and procurement.
For me the question was how communications could add real value to the Council to save money, and if possible improve services at the same time.
Behavioural insights appeared to offer a low-cost solution with what looked like impressive results.
The EAST model
The Behavioural Insights Team’s EAST model encourages changes in behaviour based on four simple principles: make it Easy, Attractive, Social and Timely (EAST). I took this model and applied it to my local authority setting.
Easy: make it as easy as possible to take up a service. We have a strong tendency to go with the default option, and will often pick this rather than the choice that requires some effort. Make your preferred choice as effortless as possible.
Attractive: use colour, images and personalisation to make your preferred choice the most attractive one. Reward people as well.
Social: show that most people perform the desired behaviour. If you send out a letter saying 9 out of 10 people pay their Council Tax on time, people are more likely to pay promptly.
Timely: prompt people when they are likely to be most receptive. For example, behaviour is generally easier to change when habits are already disrupted, such as, around major life events.
Initially, I looked at quick wins that would make a huge impact, save money and improve services. It sounded too good to be true, but the evidence seemed sound.
After some small-scale trials, I decided to run a larger experiment, testing how nudge could be applied to garden waste renewals. Every year, the Havering Council wrote to 20,000 residents asking them to renew their garden waste bin, giving them a choice of phone, online or post to renew.
My goal was to achieve a renewal rate of 20 per cent online – the choices being by post, phone and online. Based on previous experience, I thought this would be an achievable, if stretching, target.
My main focus was the renewal letter and applying the EAST principles to it. We placed the online option response prominently on the front page making it the default option – phone and post options were placed less prominently on page two of the letter.
The online renewal process was tested with a small group of participants, re-tested, and then tested again to ensure it was as easy as possible. In the letter, the renewal process was clearly explained and placed within an eye-catching graphic (and again the wording on the letter was tested with a group of participants).
The letter was redesigned, with graphics and images, based on Royal Mail’s eye-tracker research, to draw people’s attention to the online option.
The result. 46 per cent renewed online compared to other channels, thanks to the redesign of the letter along with targeted use of email, far exceeding my expectations (and winning an award in the process).
This convinced me, and senior colleagues at the Council, to roll out experiments in other areas from Council Tax payments to parking renewals.
Several years later, I decided to move from my job and become a Communications Consultant helping organisations to benefit from behavioural insights and improve their communications with effective and low-cost interventions.
This article was first published by the Chartered Institute of Public Relations in January 2018
Dominic Ridley-Moy MCIPR has worked in communications for more than 17 years in the local authority, social housing and charity sectors. He now works as a Communications Consultant, helping organisations benefit from behavioural insights, plan campaigns and develop communications strategies.
Photo by Ben Rosett