From Tesco to Fidelity, three ways in which companies are harnessing the power of behavioural science for business. By Jez Groom and April Vellacott
If you heard that there was a simple way to double your assets under management, would you try it? What if there was a secret recipe for re-designing your communications to increase conversion by 10%? Or what if someone told you that by re-painting the walls of your office, you could radically improve employee wellbeing?
Thinking, Fast and Slow by Daniel Kahneman popularised behavioural economics. It summarises a vast body of work since the 1970s showing that humans, contrary to the assumptions of classical economics, behave in ways which are predictably irrational.
Over the last decade, we’ve seen so-called ‘nudge theory’ starting to be applied in real-world situations such as policy. The Behavioural Insights Team, founded within the UK Government, is dedicated to such work.
But how can behavioural science help businesses? In recent years, more and more companies have started maximising science to give them competitive advantage. Small behaviour changes can have a seismic ripple effect on your business. Every time a human interacts with your business – be that your employees, or your customers – you can apply behavioural science to make it a better experience. This means phone conversations, communications and physical spaces are all ripe with opportunity.