Podcast Summary
Applying Behavioral Science in Business: Tips from an Expert: Identify a problem, research principles, test interventions, and use data-driven methods to apply behavioral science in businesses for better customer engagement, retention, and loyalty.
Applying behavioral science in businesses can be a challenge, despite its potential benefits. Many professionals are interested in the principles of behavioral science but struggle to incorporate them into their day-to-day jobs. Melina Palmer, a behavioral science expert and founder of the Brainy Business Podcast, shared her top tips for using behavioral science in businesses. She suggested starting by identifying a specific problem or goal, then researching relevant behavioral science principles, and testing interventions with data-driven methods. HubSpot's new Service Hub can also help businesses better connect with customers and keep them happy by providing an AI-powered help desk, chatbot, and customer success workspace. While it's important to understand the principles of behavioral science, there's no one-size-fits-all solution. Each application requires careful consideration and testing. Overall, incorporating behavioral science into business practices can lead to improved customer engagement, retention, and loyalty.
Framing Communication for Maximum Impact: Changing the framing of communication from technical descriptions to user benefits can lead to increased conversions and engagement.
Using the right framing in communication can significantly impact how our messages are received by the subconscious mind, leading to increased conversions and engagement. The speaker shares an example from their experience at Hotjar, where changing the framing from technical descriptions to user benefits resulted in a 2.32% increase in conversions. This simple test is a crucial first step in applying behavioral science principles and demonstrating their effectiveness. The tests don't need to be complex; they can be as simple as A/B tests with two versions of a page running concurrently until statistically significant results are obtained. By focusing on the benefits and making communication more relatable, we can tap into the power of the subconscious mind and create more persuasive and influential messages.
Combining behavioral science principles for better outcomes: Using a multi-faceted approach to behavioral design by combining various behavioral principles can lead to significant improvements in business outcomes.
Combining various behavioral science principles can lead to significant improvements in business outcomes. For instance, presenting bonuses as a potential loss instead of a reward can increase performance by triggering loss aversion. Similarly, adding a virtual character to an app can motivate users to stick to their goals by appealing to their emotions. These examples demonstrate the power of using a multi-faceted approach to behavioral design. As Melina explains, it's like being a master baker – you need to understand the different ingredients (behavioral principles) and know how to combine them effectively to create the desired outcome. Trying to apply just one principle at a time may not yield the best results. By experimenting with various combinations, businesses can create effective nudges that engage customers and drive positive behavior change.
Foundation for Applying Behavioral Economics: Start with established practices, experiment with new ideas, prepare for failures, improve user experience with nudges, hire natural questioners, communicate effectively, and advocate for new approaches.
Understanding the concepts of behavioral economics, or the "ingredients," is the foundation for successfully applying it. Start with a basic recipe or established practices, then experiment with new ideas and techniques. Be prepared for some failures along the way as you refine your methods. Applying behavioral economics to improve user experience, like adding nudges to a landing page, can result in significant improvements. When hiring practitioners, look for individuals who are natural questioners, able to communicate effectively, and can advocate for new approaches despite resistance. Remember, the journey to mastering behavioral economics is a process that requires persistence and a solid understanding of both the science and the strategic implementation.
Applying Behavioral Science to Influence Customer Behavior: Small, cost-effective ways to apply behavioral science include reframing product presentations and reliable testing, but continuous learning and experimentation are key.
Applying behavioral science principles to influence customer behavior doesn't require a big budget or a team of experts. Melina shared an example of a small jewelry business owner who was able to more than double her average ticket price by simply reframing how she presented her products and services. This is just one of the many small, cost-effective ways to apply behavioral science in your work. However, it's important to remember that reliable testing is crucial to getting reliable results. Melina emphasized that she was held back from applying behavioral science for years due to her fear of testing and analyzing results. Lastly, Melina highlighted a common challenge for first-timers: understanding the nuances and complexities of human behavior. She encouraged us to approach behavioral science as a long-term process and to be open to continuous learning and experimentation.
Understanding the true problem before implementing solutions: Identifying the root cause of a problem can lead to innovative and effective solutions by asking different questions and looking beyond initial assumptions
When applying behavioral science to business problems, it's crucial to identify the true problem before implementing solutions. This may involve asking different questions and looking beyond initial assumptions. A classic example of this is the creation of a weight tracking scale without numbers by Schapha and Dan Ariely. By focusing on the goal of making people healthier rather than creating a better scale, they discovered that people are more motivated by seeing trends and progress, rather than exact weight measurements. This led to the development of a scale that uses colors to indicate weight trends, which has been proven to help people maintain their weight more effectively. Therefore, taking the time to understand the root cause of a problem can lead to innovative and effective solutions.
Free Chapter of Melina's Book for Nudge Listeners: Listeners can download the first chapter of Melina's book for free and purchase the full book using the links in the show notes.
That Melina, the guest on Nudge podcast, is offering the first chapter of her book for free for listeners. Interested individuals can download it by visiting brainybusiness.com/forward/nudge. If they enjoy the preview, they can proceed to buy the book using the link provided in the show notes. Additionally, Melina's podcast link can also be found in the show notes. Listeners are encouraged to get in touch with Phil, the podcast host, through email at phil@nudgepodcast.com or on Twitter @p_agnewagnew. Tune in again in two weeks for another episode of Nudge.
