Nudging

Nudging is a behavioral influencing technique, which was described for the first time in 2008. Other people’s decisions can be influenced with this method. This makes their decision more predictable. Nudges are usually not obvious to the decision-makers. Rather, they perceive this influence unconsciously or even positively, since it is not expressed in the form of prohibitions or commands. Nudging is used both in politics and online marketing. Nudges can also be found in the UX design.

Background

The concept of nudging was first discussed in detail by Richard Thaler and Cass Sunstein in 2008 in their essay “Decisions About Health, Wealth, and Happiness.” The legal scholar Sunstein and the economist Thaler considered this method mainly from the behavioral point of view. They have directly investigated how the behavior of consumers can be influenced with nudging in such a way that it becomes predictable. The influence is entirely without prohibitions or commands. In spite of this influence, the person always has the option to decide against it.

In their work, the researchers assume that people can only make rational decisions to a limited extent. An important factor for decisions is rather the overall context in which they are made. The approach for nudging is precisely this context. Sunstein and Thaler specifically addressed the citizens of a state and described the use of nudging at the service of the common good. In other words, if the context for a decision is thrown into consciousness of consumers, their decision can be positively influenced by a nudge. The researchers have provided various examples of the positive social effects of nudging. For example, they indicated that a fly placed in a urinal causes a large proportion of men to actually use the urinal. Another example of their research showed that people in a cafeteria tend to opt for fruit instead of donuts when placed within easy reach.

Nudging in practice

Nudging was originally conceived to direct consumer choices to serve the common good. There are now several areas of application for this method.

Politics: Both the governments of the United States and Great Britain as well as the government in Germany have recognized the great potential of nudging. In England and the US there are separate teams which deal with this topic. Since 2014 there are employees with corresponding tasks in Germany. For example, they examine how citizens can be motivated with nudges to pay taxes or to eat healthy food.

Advertising: In marketing, nudging is used to prompt consumers to purchase or convert. The techniques can be found in both analog and digital advertising forms. In the case of nudging, reference quantities are available for referral marketing or influencer marketing.

Trade: Trade is profiting greatly from the effects of nudging. For example, there are special plans for store transactions, according to which goods are placed or set up. The method is combined with the analysis of Big Data.

E-commerce: E-commerce is considered to profit greatly from nudges. Online shops can use nudging techniques both in advertising and in the design of their website.

Psychology: Nudges play an important role in behavioral research. For psychologists, it is important to understand the processes behind the respective decisions. The use of nudging in treatment is also conceivable.

Public relations: PR employees, often referred to as “spin doctors,” have the opportunity to influence consumers on behalf of governments, parties or companies. Nudging can be used here for branding.

How it works

A person is guided in their decision-making through nudges. This “decision-making aid” can take the form of various media and campaigns. As a rule, a user can decide between two or more alternatives. However, it is relatively certain that he will choose the desired alternative.

Nudging can be conducted on websites in the form of graphical elements or other content. Nudges are, however, part of a comprehensive campaign.

An example:

In web design, nudging can be applied to pricing, for example. A service provider offers three different service packages. These have different performance levels and therefore different prices. If the provider wants to sell his medium package, he has several options. He can equip the smallest package with significantly less functionality and make the large package at the same time very expensive. The consumer will then probably choose the medium package, because it offers the best price / performance ratio, although the service may not even be necessary.

In principle, however, it is always assumed that the user, the citizen, or the patient ultimately decides for themselves.

Criticism of the method

Various criticisms of nudging as a method exists. Some scientists, for example, have already criticized the approach. They doubt that people are not rational in making decisions.

Others, on the other hand, complain about the fact that nudges do not lead to progress in thinking because the decision-making process is taken away from the participants.

From a social point of view, nudges are often viewed by constitutional rights advocates as an intrusion into the fundamental rights of man because people are directly influenced in their decision.

Consumer advocates see in nudging a technique that manipulates consumers. They are actively manipulated, for example, in their purchase decision, without it becoming apparent to them that it is actually advertising.

Benefits for online marketing

The benefits of nudging for online marketing are diverse. For example, marketing campaigns such as content marketing can serve as nudges. At the same time, nudges also affect the design of websites, banners, graphics or content. Even influencers can be chosen from the viewpoint of nudging.

But nudging itself is not a specific action. Rather, different insights into user behavior are used to influence the behavior of users in future purchase decisions.