How big data is nudging us further than ever before
Almost a decade has passed since Cass Sunstein and Richard Thaler's Nudge was released, and its revelations are still having an impact today. Freelance creative strategist Antony Giorgione looks at the state of behavioural play.
Back in my schooldays I moonlighted as a restaurant dishpig. Each night the chef would look in the coolroom, then come out and dictate the specials to the floor staff, with a particular focus on ingredients that needed to be moved on.
He was nudging, though that’s not what he called it.
Nudging is an offshoot of the increasingly popular field of psychology known as behavioural economics. Behavioural economics has come to imply some sort of ‘psychological magic’, but in reality it is more akin a revised set of cognitive shortcuts, baselines and differentials.
For example, it posits that we might experience a financial loss more deeply than we experience a commensurate gain, or that we might deduce Cologne has a larger population than Herne simply because we’ve heard of Cologne and not of Herne.
Nudging itself is the application of behavioural economics and related theories into the public realm.
Its principles were laid down by Cass Sunstein and Richard Thaler in their book ‘Nudge’, where the authors outline a set of methodologies with which an individual might be tacitly encouraged towards a better behaviour – such as default rules, simplification, the use of social norms and reminders, among other things.
Since the publication of the book, nudge units have emerged around the world to apply these ideas into areas of governmental policy.
The Victorian Government has recently set up a behavioural unit and Thaler one in the US, but the most significant player in this field is the Behavioural Insights Team created as an adjunct to the UK government. The BIT is now a privately-owned entity with a global representation including within the NSW Government.
I have written before on Mumbrella about the BIT’s work; specifically how they used a couple of sentences in a recruitment process to bring minority applicants on par with the dominant cohort in test pass-rates.
Now BIT has commodified nudging processes to the extent that they can apply similar methodologies cross-culturally, for example using the same system for hastening the payment of rates in Costa Rica or Singapore. They have also built a proprietary recruitment system to minimise unwanted bias, known as ’Applied’ and it is available for use by any entity – public or private.
BIT has become, in effect, a rapidly growing comms agency network.
So like dynamite – invented to help miners – and the world wide web – invented for defence and education infrastructure – the idea of nudging is expanding beyond its original remit.
In parallel with the output of the public interest behavioural units are the consumer-orientated Facebook, Google, Amazon et al. – the largest ever petri dishes of behavioural data in the history of everything.
Where the behavioural units use strictly governed randomised controlled testing, the online giants are accumulating vast swathes of behavioural history to test against itself. They work with a significantly larger sample; a scale so great we really only seem to know a fraction of what is actually being tested or applied. Or learned.
There is a revealing article by Noam Scheiber in the New York Times that lays out the ongoing application of nudging within the private sector.
Uber ran a program aimed at their drivers. They could keep them out on the road longer with small nudges such as automatically loading the next ride whilst in the midst of the current ride, or a male manager using a female persona in despatches to encourage the (overwhelmingly male) drivers to move to a more desired location.
In another example, Uber would send a message to a driver close to the end of their shift challenging them to ‘make it to $330’, that figure being only $10 and one more ride away. They would send this message with two option buttons; ‘go offline’ and ‘keep driving’. The ‘keep driving’ button was highlighted.
Of course, these sorts of practices are not restricted to Uber’s drivers.
There’s the discovery they made about battery life. It turns out the Uber app was capable of reading a host phone’s settings, and they identified a relationship between the urgency around battery life and the willingness to accept higher surging.
Those whose phone was about to go flat were prepared to accept surge prices up to nine times higher. Uber admitted to the study, but claimed it has not been applied back onto their customer base.
Our threshold for tolerating these practices can be demonstrated against this above information.
Now that you know this about Uber, are you going to stop using them?
Probably not.
The value of the service’s utility to us outweighs these perceived shortcomings, as well as others.
We accept Uber for what they are. And more for what they bring to us.
If you’re hoping there might be consumer laws against some of the more predatory nudging practices, I’m not sure when that will come to be. Though the book is focused on the newer (and older) legal structures of the EU, from ‘Nudge and the Law’ comes this quote:
“Just like laws of other jurisdictions, EU consumer protection law predates the behavioural awareness that characterises our time.”
We can see this lag in the specific area of pricing. Though our own consumer laws address aspects of variable pricing, it now sits within the context of dynamic pricing.
The issue is compounded by the ubiquity of nudging. Weather is a nudge, so is the feeling of carpet under our shoes. How do we legislate around the height of a shelf, or the reasons behind the inclusion of a dish on a specials board? This revised set of understandings about the human condition is so completely imbued within every aspect of our existence.
There is an interesting case being fought out in the US between Linkedin and HiQ. HiQ was scraping information from the publicly-accessed profiles of Linkedin members, and using it to created a database predicting those most likely to leave their job. A US District Court judge has recently ruled in HiQ’s favour, but Linkedin plans to challenge the decision.
If upheld in the higher courts, it paves the way for large data-scraping entities – some that could be focused on consumer awareness of online nudging-type practices.
Kind of like ‘The Checkout’ meets virus security.
At the moment, though, it seems to come down to the individual to protect themselves with knowledge. I recommend reading ‘Nudge’, as well as ‘Thinking Fast and Slow’ by Daniel Kahneman and ‘The Power of Habit’ by Charles Duhigg, before diving into the deep pool of peer-review literature.
I’d also like to suggest another title, quite different from the above.
It’s called ‘Never Split The Difference’ by Chris Voss, a former FBI hostage negotiator. Voss has written this book to apply his learnings into everyday negotiation scenarios, such as asking for a pay rise or getting your child to eat their vegetables.
In contrast to the other readings, his lessons are borne of direct experience. Voss spent years refining his methods in the most extreme of situations before going to business school and discovering how to systematise this material.
Within his book he refers to Kahneman’s dual-process model that underpins much of behavioural economics, as well as other psychological studies, and breaks down his negotiating technique into small packages – or nudges.
This book is a great introduction to the idea of nudging for someone who doesn’t really read about psychology much, and its learnings can quite easily be made self-evident.
Ultimately, it’s up to you alone to figure out how to respond to nudging. If you can be bothered.
And if you’re a business, you’re already using it.
But is your competitor using it better?
Antony Giorgione is a freelance creative strategist.
1) “never use a long word where a short one will do” George Orwell
2) enough with the phony behavioural economists. Seriously mate, to anyone who knows how behavioural science (or economics or whatever you want to call it) works in practice, this article is bollocks
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Hi Tim, thanks for your comment. My guidance from Josie is to write these pieces so that a someone entering the industry can understand them. Lots of big words were cut out of the final draft.
I generally agree with you about the use of the term ‘behavioural economics’, but that’s the term that has come to encompass the behavioural sciences in the public mind. For what its worth, it has been brought up only once by a lecturer during my studies in psychology at Swinburne. Prospect theory and System1/2 get a handful of pages amongst the thousands of pages of text I have had as assigned reading, behavioural economics doesn’t rate a mention.
Your comment reads as if you work in the behavioural sciences, so I’d genuinely appreciate you pointing out where I have misrepresented anything, for my own benefit as much as anyone else’s.
My proposed title for this piece was ‘Why You Can’t Afford To Ignore Nudging’ – and the point was to lay out the various ways nudging – for want of a better word – has been codified.
cheers, Antony
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I’ve just finished reading ‘Thinking, Fast and Slow’, so thumbs up for your concise piece, and for the link to Noam Scheiber’s article.
And from the higher ed sector, I’m nowhere near the first one to make this observation, but education has been slow or ham-fisted in capitalising on available student data and student-facing technology to create and automate delivery of nudges. At the risk of sounding like Captain Obvious, smart solutions using nudge theory as a carrot (rather than just a stick) would positively impact all students, not just those identified as at-risk.
Cheers, Jose
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Don’t feed the trolls Anthony, really well written article and plenty of great insight.
Shame about the title being changed, ‘Big Data’ does feel like it was stapled on at the end to get another buzz word in there.
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Marc, I appreciate your compliments.
Tim and I have found some common ground, so it seems all’s well…
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Hi Josie, thanks for the considered comment.
If I may, I’d like to make two points.
The first goes to the yet unanswered question of where a nudge should and shouldn’t be applied.
This is a very complex issue; I am surrounded by uni-age students who show me how to find answers to tests online and other ‘cheats’. I’m not interested. There are also legal substances available that can be taken to heighten and lengthen the cognitive capacity. I’m not interested. If a student chooses to improve their chances with nudging, then I believe they should seek it out themselves.
I believe it is the responsibility of the university to provide me with the information – in my case around psychology – and it is up to me to earn the merit of high marks.
However, if a student is, say, the first generation in their family to attend uni then there are hurdles that nudging can them get over, which goes back to the issue of stereotype threat and values affirmation.
The second point I want to make goes to the fallibility of nudging. If you read the BIT 2015/2016 Update review, you will note that some of their previous successes are not always replicated. To their credit they publish the results confirming the null hypothesis, which – as this extraordinary article linked below about the peer-review literature industry states – is very rare indeed.
https://www.theguardian.com/science/2017/jun/27/profitable-business-scientific-publishing-bad-for-science
So I think to view nudging as an easily automated silver bullet might be expecting too much of it.
I hope I haven’t come across as too discouraging here, I have found the Mumbrella comment streams to be one of the best forums to discuss these things in depth, so it would be great to hear more from your perspective on this.
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No, not discouraging, though perhaps we have slightly different interpretations of nudging. I probably could have also clarified where I was coming from in my first post – which was both from the post-grad student perspective, and as designer for online learning. Lecturers and academics started jumping on the nudge theory bandwagon several years ago, and incorporating it into their pedagogical approach. The intention is always, of course, to positively influence the learning behaviour of students. Great. However, the way these good intentions have manifested in course materials and learning management systems has varied from good, to meh, to pretty awful.
Examples: a good nudge might be the positive feedback, prompts, or reminders generated by the online LMS as you progress your way through a subject. A pretty simple example, but one that is underestimated as it is often erroneously assumed students are now all ‘digital natives’. A meh approach has been the assumption that students are all extrinsically motivated, and therefore need to be entertained to learn something. Cue the fashion for gamification. Using badges and leaderboards for learning activities isn’t a magic formula that will engage everyone. And assuming your students are motivated to play the equivalent of Where’s Wally? just to find their assessment tasks or reading list is plainly a shitty student experience.
So no, I don’t view nudging as an easily automated silver bullet. But it doesn’t have to be self-generating stink bomb either.
Thanks for your reply, Jose
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Yes, I can see where you’re coming from.
I get nudged at uni, but only on administrative things – fees, enrolment deadlines, etc. I don’t think its Nudging though, just a well-designed and unobtrusive set of reminders.
I don’t get nudged as part of the curriculum, in a university which is recognised for its work in psychology. What I said to Tim above about behavioural economics goes more for nudging. It’s certainly not in the curriculum, and if I bring it up after a lecture I get blank stares.
Which seems at odds with your observation about the penetration of nudging into the pedagogical approach.
That’s not a criticism of my lecturers, it probably more a reflection of where nudging sits in the scheme of psychological things. Nudging revolves around impulsivity and habit, and we are much more than our impulsive and habitual selves.
And besides which, the lecturers loathe spoon-feeding us.
Having said that, I can see where nudging might be able to augment study habits. I can also see where it might be used to highlight key aspects of the curriculum.
But I don’t see the scale.
Alongside my pollyanna mature-age student nerdiness is experience on the Swinburne marketing account, as well as the Swinburne Online joint-venture. I have some idea how the IP travels through these various entities, starting with the lecture I’ve just attended.
To create a curriculum with the full range of nudge variations required for any yearly cohort would be beyond the scope of a single university. I see Reed Elsevier or LexisNexis as more likely to be able to package up a curriculum like that, if it is at all possible to make it work, and make it work without disadvantaging someone.
Instead, I’d put all that effort into enhancing the curriculum with the university’s USP – the lecture theatre. Sitting where Swinburne’s graphic design department used to be housed in that fibro shack is a gleaming new ten storey building with an IMAX-gradient auditorium.
And yet we still get a powerpoint with a bit of youtube, and a small figure behind a lecturn.
Find the tentpole moments from each course, and build an immersive experience within that lecture theatre that cannot be experienced anywhere else. If there’s one thing the MOOC cannot provide, it’s the collective live moment.
As for nudging, I would still maintain that in a university context it’s probably more appropriate as a baseline leveller than as a study enhancer.
It was nice to meet you again, Josie.
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All very interesting points, thanks. And without getting all Humpty Dumpty about it (a word means whatever I want it to mean), I’m pondering whether nudging has evolved to a different accepted meaning in the educational context. I don’t know.
I can’t speak for the approaches of other tertiary institutions in regards to pedagogy (online or otherwise), and I know my experience is not an universal one even among colleges or portfolios, let alone institutions. What is accepted practice in one school can draw a blank stare in another. But the conversation about behaviour change theory in designing curriculum is not new. There are a number of academic publications/conferences in past years regarding new ways in which networked technologies might be used as a form of pedagogical persuasion to influence and shape learners’ behavior, even at the unconscious or irrational level. Are we talking about the same thing? Not sure.
But I guess my original point was that awareness of all of the above doesn’t mean it is employed particularly well. The learner is being reimagined as a more active, interactive, connected and collaborative individual—yet as you pointed out — you’re still getting the passive PowerPoint experience with a talking head.
Thanks for the discussion, and nice to meet you again too. I’m almost sorry the fibro shack is gone, but that’s probably old-farty nostalgia talking.
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We’re generally on the same page – we are both are looking to increase the persuasive capacity of the curriculum. I’d definitely do stuff around gamification and other ways to get students to truly engage, but I’d change the 12 lecture semester unit to three immersive tentpole moments, then fashion the lecture schedule and interactivity around these hubs.
Keep well Jose
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