A  Presenta*on  from  The  NewMR  Behaviour  Economics  Event  

19  April  2012  

An  Introduc+on  to  Behavioural  Economics    Ray  Poynter,  Vision  Cri+cal  

Event  sponsored  by  Greenbook  All  copyright  owned  by  The  Future  Place  and  the  presenters  of  the  material  

For  more  informa>on  about  Greenbook  visit  www.greenbookblog.org  For  more  informa>on  about  NewMR  events  visit  newmr.org  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

An  Introduc*on  to  Behavioural  Economics  19  April  2012  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Agenda  

1.  The  context  for  Behavioural  Economics  2.  Key  themes  3.  Implica>ons  for  market  research  4.  Further  reading  5.  Closing  thoughts  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Ra>onal  Consumers  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Wages  are  s>cky  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Psychology  

Cogni>ve  Psychology  

Social  Psychology  

Evolu>onary  Psychology  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Ul>matum  Game  

Originally  proposed  by  Güth,  SchmiSberger,  and  Schwarze  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

We  are  to  thinking  as  cats  are  to  swimming    

we  can  do  it  if  we  have  to  

Daniel  Kahneman  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

System  1  and  2  

System  1  –  Make  a  disgust  face  when  

shown  horrible  picture  –  Calculate  2+2=?  –  Drive  car  on  empty  road  –  Detect  that  one  object  is  

more  distant  than  another  –  Complete  the  phrase  

“Bread  and  ……”  

System  2  –  Focus  on  one  person’s  

voice  in  a  crowded  room  –  Fill  out  a  tax  form  –  Walk  faster  than  is  normal  

for  you  –  Compare  two  washing  

machines  for  overall  value  –  Look  for  a  woman  with  

white  hair  

From  Daniel  Kahneman’s  Thinking  Fast  and  Slow  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Context  

Dan  Ariely  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Default  and  Iner>a  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Ra>ng  Problem  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Priming,  Anchoring,  Framing  How  expensive  do  you  think  a  business  return  flight  from  London  to  New  York  in  May  will  be?  ______  

What  would  you  expect  to  pay  for  an  economy  return  flight  from  London  to  Paris  in  May?    (pick  the  answer  closest  to  the  number  in  your  mind)  

a.  Less  than  £40  b.  £40  c.  £80  d.  £120  e.  £160  f.  More  than  £200  

a.  Less  than  £100  b.  £150  c.  £200  d.  £250  e.  £300  f.  More  than  £300  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Implica>ons  for  Market  Research  

1.  Back  to  basics  –  Research  is  a  psychological  instrument  –  Experimental  design  –  Consistent  rela>onship  between  response  &  ac>on  

2.  Key  elements  –  Context  –  System  1  or  2  –  Is  the  decision  personal  or  social?  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Further  Reading  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

4  Thoughts  1.  Don’t  throw  the  baby  out  with  the  

bathwater  

2.  The  issues  raised  by  BE  are  reasons  to  use  professional  researchers,  and  a  risk  for  DIY  

3.  Don’t  just  use  a  technique  you’ve  used  before,  think  about  why  and  how  it  might  work?  

4.  Of  all  the  points  BE  raises,  context  is  probably  the  most  ‘powerful’  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Thank  You  

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Q  &  A  

Sue York NewMR

Ray Poynter Vision Critical

Speaker: Ray Poynter, VCU @ Vision Critical, UK NewMR Behavioural Economics Event, 19 April 2012, Session 1

Ray  Poynter  and  Vision  Cri>cal  

1-­‐7  Boundary  Row  London,  SE1  8HP  United  Kingdom  Phone:  +44  (0)  20  7633  2900  T:  @RayPoynter  L:  hSp://www.linkedin.com/in/raypoynter  

A  Presenta*on  from  The  NewMR  Behaviour  Economics  Event  

19  April  2012  

An  Introduc+on  to  Behavioural  Economics    Ray  Poynter,  Vision  Cri+cal  

Event  sponsored  by  Greenbook  All  copyright  owned  by  The  Future  Place  and  the  presenters  of  the  material  

For  more  informa>on  about  Greenbook  visit  www.greenbookblog.org  For  more  informa>on  about  NewMR  events  visit  newmr.org