IPA outline most effective marketing strategies to harness behavioural economics
Advertisers have been handed five marketing strategies they can use to harness the effects of psychological, social, cognitive and emotional factors to solve business problems following the launch of an IPA report.
The guidelines are the focal point of the trade body’s latest behavioural economics study,which is based on the learnings from its own effectiveness awards; big nudges, small nudges and behavioural journeys, price campaigns, positioning campaigns and better data and evaluation.
Each approach translates into a variety of strategies such as the ‘piggy-back’ of existing behaviours to ‘nudge’ people in a particular direction and reducing the barrier of effort impeding a desired outcome.
Other nuggets of advice include reframing the promotion of discounts using phrases such as a ‘price freeze’ as opposed to a small percentage discount and to put the value of discounts against people’s ‘pain points’ such as fees and charges rather than the value of core goods.
Nick Southgate, co-author of the ‘Behavioural Economics in Action’ report, said: “Whether it is building a big nudge to change behaviour, finding a series of small nudges to bring even more customers towards a brand, making a price work harder or a positioning that turns a business into a beloved icon of the high street, it is the creativity of agencies making this happen. By providing advice and exemplars within this guide, we hope that more agencies can capitalise on this hugely powerful discipline.”
Rory Sutherland, IPA President and vice-chairman of Ogilvy Group UK, said: “Much human behaviour is not conventionally rational - it is meta-rational. It is perfectly sensible given the informational constraints of the physical and social worlds in which we live and in which we evolved. But it differs quite markedly from the idea of ‘rationality’ which has become prevalent in economics, in business and in government policy-making.
"So that is the real job of any marketer to question “Are we being shallowly rational here? Are we making decisions based on assumptions of human cognition and behaviour which simply cannot apply in the real world?” Every single and highly effective case within this guide has come about because someone had the wit and courage to ask that question. I encourage others to follow suit.”
As part of their research 14 case studies were looked at including Aldi, Dacia and TfL.