Nudge Theory
Topic 27
Nudge Theory
• Nudge meaning - to touch or push gently
- to seek the attention of by a push of the elbow
- to prod lightly : urge into action
Nudge theory is a flexible and modern concept for:
• Understanding how people think, make decisions,
and behave,
• Helping people improve their thinking and decisions,
• Managing change of all sorts, and
• Identifying and modifying existing unhelpful influences on
people.
• A nudge is a simple aspect of people’s decision-making environment
that alters their behavior in a predictable way, without forbidding any
options or significantly changing their incentives.
• For example, if a school wants to reduce the amount of soda that
students drink, then placing water bottles instead of soda cans near
the register in the cafeteria counts as a nudge, while banning soda
outright does not.
• Nudges are generally viewed as low-cost, behaviorally-informed, choice-
preserving solutions to various personal and societal issues.
• This means that nudges are generally easy to implement, are relatively
effective, and allow people to make their own choices, which has led to
their widespread adoption in both the private and the public sectors, in
fields such as finance, education, and health.
• Because of how prevalent nudges are, and because of how substantial
their influences can be, it’s important to understand them.
Examples of nudges
• An example of a nudge is a sign, placed near the
door of a room in an office building, which
reminds people that they should turn off the light
when they leave in order to reduce electricity
consumption.
• Another example of a nudge is a reminder, sent to
students by their teacher via email, telling them
that their class project is due in a week, and that it
took past students a week of hard work to
complete their own projects.
Benefits of Nudge
1. Nudges can prompt people to take better care of their health. For example, sending
people a reminder to schedule a dental check-up doubled the rate of people who
signed up.
2. Nudges can prompt people to make better financial decisions. For example, sending
students a few personalized text messages helped many of them remember to refile
their application for student aid.
3. Nudges can prompt people to pay better attention to their privacy. For example, giving
social-media users a reminder about who will be the audience for content that they intend
to post helped those users make better decisions regarding
what to post and where to post it.
4. Nudges can prompt people to make choices that benefit other members of society. For
example, using an opt-out system for organ donations, where people are automatically
registered as organ donors unless they choose otherwise, instead of an opt-in system,
where people have to actively register to become donors, significantly increased the
number of people that are registered as organ donors.
5. Nudges can get people to make choices that are better for the environment. For
example, providing feedback to households about their and their neighbors’ electricity
usage led people to reduce their energy consumption.
• Nudge was initially developed as an ethical concept, by
academics, for the improvement of society, not as a
mechanism for commercial exploitation, or government
manipulation.
• From these beginnings, the Nudge concept now offers vastly
bigger implications and applications.
• Nudge principles and techniques are now increasingly
significant in communications, marketing, and the motivation
of groups: in business, marketing, selling, organizational
leadership, politics, economics, education, welfare; really in
any situation where someone or a body of some sorts seeks
to influence a person or a group of people, for example a
customer group, or an entire society - or simply yourself, as
an aid to improving personal health, wealth and well-being.
Nudge has dramatically affected thinking and methods
for motivating and changing people.
Nudge theory advocates change in groups through
indirect methods, rather than by direct enforcement or
instruction.
Central to the Nudge concept is that people can be
helped to:
• think appropriately, and
• make better decisions
by being offered choices that have been designed to
enable these outcomes.
Here is a showing varying characterizations of,
and differences between, traditional 'directed'
change and Nudge-oriented interventions, in
terms of key words and tactical notions.
Types of nudges
Nudges can be categorized into different types based on the
main mechanism that they use to influence people. Based
on this criterion, common types of nudges are the following:
• Setting a default option. People will often stick with the
default option that they’re presented with, so setting a
certain option as a default increases the likelihood that
people will pick it. For example, making people organ
donors by default can increase the rate of organ
donations, compared to requiring people to opt-in in
order to become donors.
• Creating a psychological anchor. A psychological anchor is an
initial piece of information that people rely on strongly when
making subsequent judgments and decisions. For example, a
charity soliciting donations can create a psychological anchor
by telling donors that “most people donate $20”, in order to
nudge people to donate more money than they would
otherwise.
• Changing the ease of choosing certain options. This can
involve either making a good option easier to choose, or
a bad option harder to choose. For example, to encourage
people to eat healthier, a cafeteria can place healthy food in
convenient locations and unhealthy food in less convenient
locations.
• Changing the salience of certain options. This can
involve either making a good option more noticeable,
or a bad option less noticeable. For example, to
encourage people to save more money, a workplace
can design relevant forms in a way that visually attracts
people’s attention to the available saving program.
• Informing people. Informing people of things such as
the benefits or dangers of certain options can
influence their behavior. For example, giving people a
simple flyer with information about their employer’s
retirement savings plan can lead people to contribute
more to it.
• Reminding people of information they know. Reminding
people of information that they already know can influence
people’s behavior, similarly to informing them of things that
they didn’t know. For example, reminding doctors about
the problem of antibiotic resistance in society can reduce
the amount of unnecessary antibiotics that they prescribe
to patients.
• Reminding people to do something. Reminding people to
do something that they need to do can prompt them to
take action. For example, sending people a reminder that
they need to schedule a doctor’s appointment can
increase the likelihood that people will do so when
necessary.
• Getting people to slow down. Encouraging people to slow down their
decision-making process can help them make better decisions. For
example, on social media, encouraging people to wait a short while
between the moment they submit a post and the time when it’s actually
posted can lead people to edit and cancel posts that they would have
otherwise regretted making public.
• Many of these types of nudges can be used both to influence other
people’s behavior, as well as your own. For example, to reduce the
amount of soda that you and your family drink, you can make the soda
bottles a more difficult option to choose, by placing them at the back of
the fridge where they’re inconvenient to reach. Similarly, you can also
put a sticker on top of them, with a reminder for you all that you’re
trying to drink less soda.
• Note: nudges can be classified based on other criteria, such as whether
they are transparent or non-transparent, or whether they involve
defaults and anchors, physical design, or deliberation tools.
Book review: The Nudge by Richard H.Thaler & Cass R Sunstein
- https://www.getstoryshots.com/books/nudge-summary/
- https://fourminutebooks.com/nudge-summary/
Topic 28
Types of Nudge
Topic 29
• Nudge theory was popularized by behavioral economists Richard
Thaler and Cass Sunstein in their seminal book, Nudge: Improving
Decisions about Health, Wealth, and Happiness. The foundational
premise of a nudge involves designing or arranging the decision-
making context in ways that promote behaviors that are in the
interest of individuals as well as that of society.
• Nudging is a behavioral science approach that uses subtle
interventions to help people make better decisions.
To be effective, a nudge must follow a two-step process:
- First, the target behavior needs to be identified.
- Second, a choice architecture (The way choices are presented
significantly impacts decision-making. By designing environments that
lead to better outcomes (e.g., placing healthier food at eye level),
people's behavior can be positively influenced.) must be created or
modified to make it easier for individuals to choose a better solution.
Subtle Suggestions
• eliciting implementation intentions (“do you plan
to vote?”)
Comment: People are more likely to engage in
activity if someone elicits their implementation
intentions. With respect to health-related behavior, a
simple question about future conduct (“do you plan
to vaccinate your child?”) can have significant
consequences. Emphasizing people’s identity can
also be effective (“you are a voter, as your past
practices suggest”)
The Default Option
• default rules (e.g., automatic enrollment in programs, including education, health,
savings)
Comment: Default rules may well be the most effective nudges.
If people are automatically enrolled in retirement plans, their savings can increase
significantly. Automatic enrollment in health care plans, or in programs designed to
improve health, can have significant effects.
Default rules of various sorts (say, double-sided printing) can promote environmental
protection.
Note that unless active choosing (also a nudge) is involved, some kind of default rule
is essentially inevitable, and hence it is a mistake to object to default rules as such.
True, it might make sense to ask people to make an active choice, rather than relying
on a default rule.
But in many contexts, default rules are indispensable, because it is too burdensome
and time-consuming to require people to choose.
Social Norming and Misperceptions
• uses of social norms (emphasizing what most people do, e.g., “most people
plan to vote” or “most people pay their taxes on time” or “nine out of ten
hotel guests reuse their towels”)
Comment: One of the most effective nudges is to inform people that most
others are engaged in certain behavior.
Such information is often most powerful when it is as local and specific as
possible (“the overwhelming majority of people in your community pay their
taxes on time”). Use of social norms can reduce criminal behavior and also
behavior that is harmful whether or not it is criminal (such as alcohol abuse,
smoking, and discrimination).
It is true that sometimes most or many people are engaging in undesirable
behavior. In such cases, it can be helpful to highlight not what most people
actually do, but instead what most people think people should do (as in, “90
percent of people in Ireland believe that people should pay their taxes on time”).
Simplification
• Simplification is a behavioral concept that focuses on making processes,
choices, or information easier to understand and navigate. By reducing
complexity, simplification helps people make decisions more efficiently and
effectively, often leading to better outcomes.
• simplification (in part to promote take-up of existing programs)
Comment: In both rich and poor countries, complexity is a serious problem, in
part because it causes confusion (and potentially violations of the law), in part
because it can increase expense (potentially reducing economic growth), and in
part because it deters participation in important programs.
Many programs fail, or succeed less than they might, because of undue complexity.
As a general rule, programs should be easily navigable, even intuitive. In many
nations, simplification of forms and regulations should be a high priority. The
effects of simplification are easy to underestimate. In many nations, the benefits
of important programs (involving education, health, finance, poverty, and
employment) are greatly reduced because of undue complexity.
A direct reminder
• reminders (for example, by email or text message, as for overdue bills and
coming obligations or appointments)
Comment: People tend to have a great deal on their minds, and when they do
not engage in certain conduct (for example, paying bills, taking medicines, or
making a doctor’s appointment), the reason might be some combination of
inertia, procrastination, competing obligations, and simple forgetfulness.
A reminder can have a significant impact. For reminders, timing greatly matters;
making sure that people can act immediately on the information is critical
(especially in light of the occasional tendency to forgetfulness).
A closely related approach is “prompted choice,” by which people are not
required to choose, but asked whether they want to choose (for example, clean
energy or a new energy provider, a privacy setting on their computer, or to be
organ donors).
Use & Application of Nudge Theory to
ensure/enable
Pro-Environmental behavior
Topic 30
WHAT ARE GREEN NUDGES?
Green Nudges are subtle interventions designed to encourage environmentally
friendly behaviors without restricting individual choices. They use principles
from behavioral science to promote sustainable practices in a way that feels
voluntary and non-coercive.
There are many different approaches to behaviour change, from enforcing
regulation to providing information. In this little book, we focus on nudges:
positive and gentle persuasion to encourage sustainable behaviour on higher
education campuses.
For example,
1) putting more sustainable food in a prominent position in the student
canteen would be a nudge, still leaving students free to eat what they want.
2) So would automatically enrolling students into a bike-sharing scheme,
regardless of whether they choose to use it.
In both cases, these simple changes would make the sustainable choice a
little easier, more salient and seemingly more normal.
• Nudging is based on an understanding of the psychology of
decision-making.
• Our brains have limited resources to make sense of a world
that is complex and uncertain, which means that we use
mental shortcuts that make our behaviour highly context-
dependent:
• for example, “do what everyone else is doing” or “take the
easiest option”. Also, a lot of our behaviour is automatic, as
we follow ingrained routines or act on auto-pilot.
• With knowledge of these cognitive processes, we can make
changes to the options people have (the “choice
environment”) in order to encourage certain choices, or we
can explicitly design choices to harness or overcome common
cognitive biases.
WHY USE NUDGES?
• Nudges help people live their values
• Nudges can work better than raising
awareness
• Nudges are cost-effective
• Nudges are needed now
WHO CAN USE GREEN NUDGES?
The Little Book of Green Nudges8 If you work or study on a higher education
campus, this book is for you! Nudges tend to be relatively simple to
implement, so you don’t have to be a policymaker with a lot of influence and
resources in order to put a nudge into effect. Perhaps you are …
• a university leader looking to prioritize environmental responsibility on
campus
• a sustainability manager wanting to make an impact on a tight budget
• a student interested in trying out something new and making a difference
This little book brings together a wide range of nudges, well supported by
evidence, and many already tested by colleges and universities. The 40
featured nudges are grouped into 12 broad strategies, which can be adapted
and applied by different people to different behaviours in different contexts.
HOW TO NUDGE: GO EAST
• If you want to encourage a behaviour,
make it Easy, Attractive, Social and Timely
•Easy
People often take the path of least resistance. You
can therefore encourage desirable behaviours by
removing small frictions or hassles, by defaulting
people into the desirable choice, or by redesigning
the way choices are presented to make the
desirable behaviours easier.
•Attractive
Humans are more likely to adopt a behaviour when it
captures our attention or is in line with our motivation
and beliefs. You can draw attention with visual cues that
are particularly relevant or noticeable, and leverage
motivation by emphasizing the positives and using
incentives.
•Social
Human behaviour is hugely influenced by what others
around us are doing. You can promote desirable actions by
highlighting the fact that other people are adopting them.
You can also make behaviour more publicly visible, and
emphasize opportunities for people to help each other.
•Timely
People are creatures of habit, so nudges are
most effective at moments of change in
people’s lives. We also have a deep tendency
to emphasize the present more than the
future. You can harness these tendencies by
timing campaigns strategically, highlighting
the immediate benefits of sustainable
actions, and helping people plan ahead.
Nudges can be effective all around the
world
Nudging works by focusing on aspects of human behaviour that are largely
universal.
Although most behavioural science research has been carried out in Western
Europe and North America, many insights into human psychology are applicable
around the globe.
For example, humans everywhere respond to social norms, and our dependence
on habit and other non-conscious mental processes is rooted deeply in our
evolutionary make-up.
The particular social norms and habits on your campus may differ from those on
other campuses, but you can still use similar strategies for nudging. Likewise, social
norms may differ by gender, age group, or other social or cultural identity, but your
nudges for particular target groups can take the same underlying approach.
Key Takeaways
• "The Little Book of Green Nudges" is a concise
publication that provides guidance on how to
create positive change and reduce
environmental impact at universities.
• Nudges are gentle interventions that influence
behavior and decision-making.
• The publication is aimed at anyone who wants
to promote sustainability at their university,
from students to professors.
Summary
• "The Little Book of Green Nudges" is a quick and user-friendly guide to
implementing behavioral changes that can reduce the environmental impact of
universities.
• Nudges are positive interventions that aim to influence behavior and decision-
making.
• This publication summarizes the evidence on effective nudges and provides
guidance on implementing and evaluating behavioral interventions in various
contexts.
• It is aimed at a wide range of people, from students to professors, who want to
create positive change and promote sustainability at their university.
• Over 100 higher education institutions from around the world have committed
to implementing green nudges as part of this initiative.
What Are Nudges?
• Nudges are positive and gentle persuasions that are meant to influence
behaviour and decision-making. Such interventions include choice architecture,
default setting, social influence and increased salience.
Nudge Strategy: The process of nudging & steps
to
create a nudge
Topic 33
• 7 Stages of the Nudge Theory
• The idea behind nudge theory is to leverage behavioral biases your employees,
customers, and partners already have to guide them toward making positive
organizational changes.
• Whether you’re trying to adopt a new SaaS application, modify or eliminate
redundant parts of your workflows, digitize existing processes, encourage
product adoption, or onboard new customers, behavioral nudges can be used to
reduce skepticism and minimize the cognitive effort your targets have to apply to
make better decisions.
1. Clearly define the expected change
• The first step of nudging stakeholders into making preferable
decisions is to remove ambiguity and define what you expect of
them clearly—not too briefly, or they’ll lack essential details,
and not too detailed either, or they will become overwhelmed.
• For instance, an enterprise might have goals as diverse as—
• Switch our sales operations from Salesforce to HubSpot.
• Reduce knowledge fragmentation and document tips shared in
Slack on our wiki.
• Update customer profiles in our CRM after every interaction.
• Upsell every customer ongoing maintenance services after
every one-off consultation.
2. Include stakeholders in the change
analysis and implementation
• For every change you try to implement within your
organization, there will always be resistance to change, either
from end-users comfortable with their existing workflows or
from leadership who might question costs & ROI.
• To sidestep these obstacles, involve these stakeholders in the
change analysis process.
• This means you must carry them along as you compare your
existing processes and situations with the (hypothetical)
benefits the expected change should offer. By involving
stakeholders early on, they have a better idea why and how
you’re making the changes proposed and where they need to
play a role to make it successful.
3. Use evidence to support the best option
and set a timeline
• This can be done via case studies, peer-reviewed articles,
scientific journals, or surveys and polls you conduct internally
or via a third-party agency.
• Large enterprises often embark on changes simply to join the
bandwagon or as vanity projects that will get a VP their latest
promotion. Not surprisingly, employees tend to be skeptical
and almost cynical when there’s yet another SaaS product or
framework that’s supposed to increase their productivity,
reduce churn, etc.
• A scientific approach helps dispel your employees’ (and
stakeholders’) doubts and justifies the change you’re
proposing with relatable examples.
4. Don’t force behavior change—present it
as a choice
• Remember, nudge theory isn’t a framework for manipulating subjects or
forcing people to make changes on a whim. The goal is to highlight
healthier options and remove structural frictions, so choosing them is a
no-brainer, without acting like a paternalistic big brother.
• For example, you can:
• Make your website’s cookie prompts opt-in by default vs. the flippant
declaration that, “by continuing to use this website, you consent to the
use of cookies,”.
• Trigger a reminder for users to take a product adoption course for the
new CRM they’re expected to switch to, instead of locking them out of
the existing one completely.
• Highlighting better choices instead of forcing them on your stakeholders
helps them retain their agency and see themselves as your change
management partners, instead of unwilling victims.
5. Gather (and listen!) to feedback
• Behavioral engineering only works to the extent that your options
make sense and you can’t build sustainable products or company
culture by deceiving people.
• For instance, if you charge users after their free trial expires, without
notifying them at least once, you’ll get a lot of chargebacks and a
barrage of poor word-of-mouth from offended customers who’ll never
come back.
• Technically, you have a right to do that (since your pricing page
specifies it) but it’s just a scummy business tactic that will alienate
customers who’d have brought you recurring revenue.
• Likewise, you need to listen to feedback throughout every stage of your
enterprise change campaigns to understand whether your stakeholders
need more apparent options or entirely new (and better) ones.
6. Remove barriers to change adoption
• Employees are often reluctant to switch to new tools & frameworks because they’ve
designed complex workflows around the systems they’re using.
• For instance, if you buy licenses for HubSpot CRM, your sales team (that uses Salesforce)
won’t be eager to make the switch because of all the automation sequences they’ve built
between SFDC & the rest of their stack. They might have set up integrations to:
• Collect signatures automatically (DocuSign).
• Send follow-ups emails to prospects who view sales collateral (Calendly).
• Schedule follow-up meetings with a few clicks.
• Even if they eventually oblige, productivity will take a severe hit because of all the tasks
that now have to be completed manually while everyone struggles to find their feet.
• Instead, you can duplicate those CRM workflow automations with integrations that can
automatically schedule follow-up emails, generate contracts, score leads, send out drip
emails, or reassign deals if an SDR doesn’t contact a lead within a specified period.
• If you want to highlight preferable choices, you need to make them preferable by
removing obstacles and barriers to change that may create friction and scare away
stakeholders.
7. Sustain change adoption by celebrating
short-term wins
• You can create a leaderboard for tracking
metrics, such as your product adoption rates,
actions completed, and the goals achieved
using the new framework or tools you’re
promoting.
• Again, this entails taking a scientific approach
to encourage stakeholders that your
alternative beats the incumbent and that
making the switch is a no-brainer.
Top 30 eCommerce nudge marketing
examples
• https://www.convertcart.com/blog/nudge-ma
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.
• https://whatfix.com/blog/nudge-theory/
