How to Take a Business From Lackluster to Legendary With Behavioral Economics

What drives customers to buy a product, or consider a price reasonable? Why do people make the purchasing decisions they do? These are the questions at the heart of behavioral economics, the science of decision making. Businesses large and small turn to behavioral economics experts to figure out what motivates a person’s consumer choices.

“By providing insights into the true drivers of motivation, behavioral science gives people shortcuts to create a winning product or campaign in a much shorter timeframe,” said Evelyn Gosnell, a behavioral economics consultant at Irrational Labs who led a workshop on the subject at UC San Diego Extension.

Behavioral economics is changing the face of business, she says. From the product manager trying to nail down which product features will hook customers, to the rep working to get people to pay their bills on time, many jobs involve understanding or influencing people’s decisions. Behavioral economics can play a role in everything from designing a cafeteria to crafting an employee benefits program.

Governments also use behavioral economics when developing policies that affect their constituents. For example, some states are moving toward automatically registering people to vote when they get a driver’s license. “There’s this bias for inaction where people won’t check the box,” Gosnell said. “So what’s the best thing to do from a policy standpoint?”

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Posted: 8/15/2019 9:00:00 AM with 0 comments
Filed under: behavioral-economics, behavioral-science, business, consumer

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