“Oh, BEhave” Series: Our Behavioral Economics Journey Recap

Beginning last October, Brooks Bell and Irrational Labs teamed up to tackle the topic of Behavioral Economics through a six-part blog series exploring the basics of behavioral economics and providing tips to help you apply it in your experimentation program. In this final blog, we’re going to revisit some of the big takeaways from each […]

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Beginning last October, Brooks Bell and Irrational Labs teamed up to tackle the topic of Behavioral Economics through a six-part blog series exploring the basics of behavioral economics and providing tips to help you apply it in your experimentation program. In this final blog, we’re going to revisit some of the big takeaways from each post.

Post 1: Creating Experiments with Behavioral Economics

Read more. Test more. The first step to understanding social science is to appreciate the complexities of humans. There is no ‘one size fits all’ solution to any problem.

In this post, we introduced you to Kristen Berman, co-founder of Irrational Labs. Irrational Labs uses the power of behavioral economics for good: helping companies improve the world by saving people money, encouraging healthy living, among other things. They often publish their findings in academic journals.  

Here at Brooks Bell, we encourage the use of behavioral economics to understand customers, applying these principles to guide digital experimentation strategies.

Despite these two distinct applications of behavioral economics, our processes for implementing them are incredibly similar.

Post 2: Even Experimentation Experts Get Surprised

Expert intuition is not always correct. It’s important to use data and behavioral economics to better understand your users and their motivations – and experiment from there.

Although both Kristen and I have run thousands of experiments between us, even we get caught off guard by test results from time to time. In this post, we shared examples of experiments that kept us guessing–highlighting one of Irrational Labs’ Google Adwords promotions and a test we ran on behalf of one of our clients, the Jimmy V Foundation.

Behavioral economics enables you to better understand the intricacies of human decision making–even when people’s actions surprise you. Applying this to testing gives you the best chance at creating a successful experience for your customers.

And while there’s no universal template for designing a customer experience, there’s a huge opportunity to test into the experience that works best for your customers. These examples highlighted the importance of having an experimental mindset rather than relying on your intuition.  

Post 3: Create a Powerhouse Methodology Using Quantitative and Qualitative Data Alongside Behavioral Economics

The only way to know if something affects another thing is to do a controlled trial.

This post detailed two different approaches to bringing quantitative data, qualitative data and behavioral economics together to create a powerhouse ideation methodology.  

Brooks Bell and Irrational Labs’ approaches to ideation are very similar, differing only in structure and terminology.

At Brooks Bell, we use an iterative, five-part structure that begins with pre-strategy data, dives into user needs, problem/opportunity identification and experiment brainstorming, and finally ends with a prioritization process.  Behavioral Economics is engrained throughout the process but takes center stage during the problem/opportunity identification as well as the experiment brainstorm.

Irrational Labs’ process begins with a literature review, followed by a quantitative data study and qualitative feedback. Then they run their controlled trial (a.k.a. an A/B test).

Of course, applying these processes into your organization depends on your resources, timeline and many other factors.

If you’re unsure where to start, let’s talk! Brooks Bell has years of experience building world-class testing programs and can help you build and implement an ideation methodology that’s specific to your team and your business goals.

Post 4: Ethical Experimentation: Using Behavioral Economics for Good

When we understand the power that companies have over our decisions, it becomes unethical when they do NOT experiment on their users.

In this post, we examined the topic of ethical experimentation: is it always right to experiment on your users? And how do you ensure you’re testing in the customer’s best interests?

Central to this debate is the imbalance of power between a company and its customers. Companies need to drive profit, and while driving profit may drive customer value, there are some situations where it could drive high prices and/or negative customer value. The most famous example of this? The tobacco industry.

But not experimenting is not an option. If a company doesn’t test a feature, it means they think the engineer who first designed the feature got it 100% right. This means the power to influence our decisions lies with the engineer who designed the feature and did so without any data on how the feature is influencing the end user.

So, how do you design a system to ensure noble intent with your experiments? First, focus on building tests with short-term and long-term value. Be transparent about your experiments. Online dating service, OK Cupid, for example, openly uses its customer data for research and publishes summaries of the insights.

Finally, give customers a means of public recourse if they feel they’ve been wronged. This not only empowers the user but also shows that your company prioritizes customer relationships over reputation or profit.

Post 5: Behavioral Principles to Know – And How to Use Them

If you get familiar with [behavioral] principles…your digital experiments are going to be more inspired, and better-informed than ever.

There are decades of behavioral science experiments at your fingertips that can be leveraged to better inform your digital experiments.  This post highlighted a few of them, including social proof, choice overload, goal gradient hypothesis and the sunk cost fallacy (among others).

We also provided a few tips and tricks to help you and your team become more familiar with these principles, with additional links to various resources (including one of my personal favorites, Dan Ariely’s Irrational Game).  

We had a lot of fun creating this series and hope you found it valuable. If you have additional thoughts or questions about behavioral economics and how to apply the principles to experimentation, let us know!  We’d love to help!

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Suzi Tripp, Sr. Director of Experimentation Strategy
At Brooks Bell, Suzi sets the course of action for impact-driving programs while working to ensure the team is utilizing and advancing our test ideation methodology to incorporate quantitative data, qualitative data, and behavioral economics principles. She has over 14 years of experience in the industry and areas of expertise include strategy, digital, communications, and client service. Suzi has a BS in Business Management with a concentration in marketing from North Carolina State.

 

Kristen Berman, Co-founder of Irrational Labs, Author, Advisor & Public Speaker
Kristen helps companies and nonprofits understand and leverage behavioral economics to increase the health, wealth and happiness of their users.  She also led the behavioral economics group at Google, a group that touches over 26 teams across Google, and hosts ones of the top behavioral change conferences globally, StartupOnomics. She co-authored a series of workbooks called Hacking Human Nature for Good: A practical guide to changing behavior, with Dan Ariely. These workbooks are being used at companies like Google, Intuit, Neflix, Fidelity, Lending Club for business strategy and design work.  Before designing, testing and scaling products that use behavioral economics, Kristen was a Sr. product manager at Intuit and camera startup, Lytro.  Kristen is an advisor for Loop Commerce, Code For America Accelerator and the Genr8tor Incubator and has spoke at Google, Facebook, Fidelity, Equifax, Stanford, Bay Area Computer Human Interaction seminar and more.

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Part 2: Our Top Takeaways from Click Summit 2018

Last week, we shared the first of many takeaways from Click Summit 2018, our annual conference for professionals in digital experimentation and personalization. This week, we’re back with more insights from each impactful conversation, inspired by this year’s edition of Clickaways. 1. Manage the three P’s of scaling your testing program: people, process, prioritization. Many companies […]

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Last week, we shared the first of many takeaways from Click Summit 2018, our annual conference for professionals in digital experimentation and personalization. This week, we’re back with more insights from each impactful conversation, inspired by this year’s edition of Clickaways.

1. Manage the three P’s of scaling your testing program: people, process, prioritization.

Many companies have found it more effective to establish a dedicated optimization team rather than having these duties dispersed across the organization. However, if that’s not possible for you, let your Center of Excellence take the lead on defining key processes, training and developing a maturity model to determine when each team is ready to start testing.

Develop a formal process for submitting, presenting, prioritizing and executing new testing ideas. Using various automation technologies can further simplify these steps.

Additionally, agree to one source of truth for your test results across multiple platforms. Companies that have various groups looking at different data sources struggle to establish the necessary credibility to scale their programs. This is one area where a knowledge platform that houses testing results, insights and ideas (like Brooks Bell’s Illuminate platform, or Optimizely’s Program Management) can help.

Finally, growing your experimentation program comes with the expectation of more tests, executed faster. When determining your velocity goals, be sure to consider quality over quantity. Always prioritize running a few, quality tests over many, low-impact tests.

2. Personalization and optimization teams should remain separate functions with connected but distinct goals.

Personalization is a worthwhile investment for any online industry, but it has to be adopted as a company-wide strategy in order to ensure you’re delivering a consistent customer experience.

To get the most out of your investment, establish a separate personalization team to run your program rather than looking to your existing experimentation team. Here are a few reasons for this: First, personalization is a longer-term strategy and “wins” occur at a much slower rate. Additionally, while there are similarities between A/B testing and personalization technologies, the questions you ask and the answers you get are very different.

Finally, running split tests is inherently easier and faster than implementing personalization. So long as your team is overseeing both functions, they’re likely to focus more on testing than personalization.

3. Focus on organizational outputs and customer insights, not just test outcomes.



Oftentimes, experimentation professionals find themselves nearest to the customer. Sure, you may not speak with them directly, but your work can have a direct effect on your customers’ experience and brand perception. That’s a lot of power, but also a lot of opportunity.

So here’s the challenge: Go beyond simple tests like button color or check out features and consider the bigger picture. Use testing to seek out insights that would be useful for other departments within your organization.

Here at Brooks Bell, we have our own framework for doing this (and we’d be happy to tell you about it). In lieu of our services, we’d encourage you to take a step back from test outcomes, spot trends and use these to develop testable customer theories.

Developing a customer theory requires you to conduct a deeper interpretation of your results–so don’t do it alone. Look to your working team to brainstorm customer theories and additional tests to validate or invalidate those. Bring in additional data sources like NPS, VOC or qualitative research to paint a more detailed picture of your customers.

Doing this can have huge implications for your customers, your experimentation program and your brand overall.

4. Build a program that strikes the perfect balance of innovation and ROI.

In order for creativity to flourish within your experimentation program, you have to establish clear goals. These are used as a framework within which your team can look for opportunities to innovate.

Develop a process for brainstorming test ideas that encourages participation and creative thinking, like using Post-It notes.



Finally, demonstrate a willingness to take calculated risks in order to make room for creativity in your optimization strategy. There is always something to be learned from negative or flat results.

Like the information in this post? Download this year’s Clickaways to access more tips, tricks and ideas from Click Summit 2018.

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Part 1: Our Top Takeaways from Click Summit 2018

Another year, another epically productive Click Summit. In the weeks since Click Summit 2018, we’ve spent some time reflecting on the event and even our heads are still reeling from the depth and quality of each conversation. This event isn’t your run-of-the-mill marketing conference. We strive to create an intimate and super-productive experience in our […]

The post Part 1: Our Top Takeaways from Click Summit 2018 appeared first on Brooks Bell.

Another year, another epically productive Click Summit. In the weeks since Click Summit 2018, we’ve spent some time reflecting on the event and even our heads are still reeling from the depth and quality of each conversation.

This event isn’t your run-of-the-mill marketing conference. We strive to create an intimate and super-productive experience in our small group conversations. Of course, the true credit goes to our attendees and moderators for their candid participation. It takes a certain level of vulnerability to look to others for feedback and direction. Those types of conversations are where the true insights come to light.

Had to sit out Click Summit this year? You’re in luck. We’ve compiled the key takeaways from each of the 22 thought-provoking conversations into an easy-to-read, downloadable resource.

Here’s our summary of some of the insights you’ll find in this year’s Clickaways

1. Relationships are key to creating buy-in for experimentation. Get to the right meetings and make the right connections. Target influential leaders to gain traction and credibility for your program. Build working partnerships with other teams, taking time to understand their goals. Work with them to make testing and personalization part of the solution.



Finally, know that proving people wrong doesn’t create buy-in. Rather, invite other departments to participate in your program and frame your tests as an opportunity to learn together. Hold monthly or bi-weekly meetings with direct and indirect stakeholders to review test wins, brainstorm new tests and discuss any resulting customer insights.

2. Instill testing in your company culture through establishing a credible team and program. Trust is easily lost, so you really need to take steps to ensure your team is positioned as a source of truth for the business, rather than one that’s encroaching on other departments. Your team should not only be experts in optimization and behavioral economics, but also experts in your customers–know their behaviors online, what motivates them and what truly makes them tick.

Hold training sessions on best practices for testing, personalization and customer insights. Regularly communicate test results and any subsequent insights to the entire company. And when sharing results, consider your audience. It may be worth creating different reporting formats for different stakeholders

3. If you want to build an army of optimization evangelists, you’ve gotta get everyone on the same page first. So long as end-to-end optimization requires working across multiple teams, it’s important that you establish clear processes and governance. Develop a common language for testing terminology; abandon jargon in favor of words that are easy to understand and don’t have multiple contexts.

Set clear rules of engagement and expectations between all teams involved in optimization. This includes engineering, IT, analytics, marketing, creative and others. Make sure communication and reporting processes are defined and any associated technologies are being used consistently.Finally, take into account how success is measured for all these other stakeholders. Not all teams are incentivized with revenue targets or conversion goals. Connect your test strategy to their objectives to ensure a unified vision.

Like the information in this post? Stay tuned for part two next week. Until then, download this year’s Clickaways to access more tips, tricks and ideas from Click Summit 2018.

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A Nudge From The World’s Most Famous Prison

The Tower of London has been a prison, a palace, and a fortress. Now, it offers a lesson in behavioral economics.
The post A Nudge From The World’s Most Famous Prison appeared first on Neuromarketing.

Tower of London

The Tower of London has been a prison, a palace, and a fortress. Now, it offers a lesson in behavioral economics.

The post A Nudge From The World’s Most Famous Prison appeared first on Neuromarketing.

Peak-End Rule: Why You Make Terrible Life Choices

It’s New Year’s Eve. There I am on the dance floor – it’s teeming with people and there’s hardly space to breathe. Loud thumping music pierces my eardrums and I have no idea where my friends are. Then, the guy next to me takes a misstep, spills a…

It’s New Year’s Eve. There I am on the dance floor – it’s teeming with people and there’s hardly space to breathe. Loud thumping music pierces my eardrums and I have no idea where my friends are. Then, the guy next to me takes a misstep, spills an entire cup of beer down my shoulder. […]

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