Page 29
panorama
BRAIN CELLS
Behavioural economics examines social, cognitive and emotional responses to understand why we make financial decisions, but can marketers really tap into our brain to boost sales? Lucy Aitken reports
If you’ve ever succumbed to a ‘buy one get one free’ offer in a supermarket, then you’ve been the subject of a behavioural economics (BE) tactic or, put more simply, experienced why we buy what we buy. Marketers have been using such tactics for decades, but recently there has been particular interest in BE and how studying human behaviour can help brands market more effectively.
This is in no small part attributed to Ogilvy lifer Rory Sutherland, president of the IPA, the trade body representing UK advertising agencies, and exponent of BE. He believes BE has the potential to give agencies the re-boot they need by generating ‘ideas to turn human understanding into business advantage’.
As some agencies appear to have ebbed away from the business objectives of their clients, lost in a sea of incomprehensible marketing jargon, it’s clear there is a need for something robust to help define them as serious players that can help move the needle.
More to the point, new types of clients (mobile phone operators, budget airlines, broadband providers etc) require a new way of working. Many of the modus operandi used in advertising agencies today assume that conventional media, particularly TV, still dominate media schedules and this just simply isn’t so. Some brands are becoming particularly adept at engaging consumers in original ways that often side-step traditional media altogether.
Pepsi Refresh is a US-based corporate social responsibility project which invites people to submit ideas for funding projects in their community, from restoring playgrounds to education or arts initiatives. According to PepsiCo, there were more votes cast on the Pepsi Refresh site in 2010 than in the 2008 US presidential election.
Similarly, North American electronics retailer Best Buy came up with an innovative Twitter-based solution to its customer service. Called Twelpforce, it offers instant help from Best Buy staff for customers both pre- and post-purchase. Developed in-house, it runs at next to no cost to the retailer.
Surely landmark ideas such as these are rooted in behavioural economics and have the potential to build substantial brand loyalty (I’ll buy Pepsi because they fund good work in the community; I’ll shop at Best Buy because they helped me figure out my netbook).
Yet some are sceptical that BE is the right horse to back. While it can offer obvious benefits in some environments, particularly in, say, e-tail (think of the ‘customers who bought this item also bought…’ recommendation service on Amazon), BE is often criticised for being too reductive. How can we ever hope to get to the bottom of the complex tangle of human needs, instincts and desires that might drive one person to purchase one brand and their sister to purchase an alternative one?
On paper, BE can seem extremely promising. But it’s worth bearing in mind that if any one discipline could help us improve our understanding of human behaviour so we could predict every purchase we were likely to make, the world would be a very dull place indeed.
springboard: |
www.ukti.gov.uk | page 29
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52