Richard Thaler – Championing Behavioral Economics

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Explorer Research is delighted that Richard Thaler has won the Nobel prize in economics for his breakthrough work in Behavioral Economics. This discipline combines the study of economics with psychology making it crucially important to the study of shopper behavior. Mr. Thaler is particularly well known for the concept of nudge theory which says that small interventions can encourage individuals to make different decisions. In other words, if you want to change people’s behavior, you have to make it easy for them to change. We do not behave as rationally as some economists would have us think.

There is mounting evidence that traditional marketing research has relied upon many beliefs about human behavior that are simply not true. For instance, stated intention and behavior are often not aligned. After all, who can deny the difficulty in keeping New Year’s resolutions?

At Explorer, we have been championing this concept with our behavioral research approach using such technologies as eye tracking, virtual reality and other neuro behavioral approaches. These methods uncover real versus reported behavior and paint a clearer picture of the way shoppers actually behave. Behavioral science provides insights that are far more accurate and actionable than traditional conscious techniques alone.

By shining a spotlight on behavioral research, Richard Thaler has done wonders to educate the marketing research industry of the importance of incorporating behavioral economics into future research approaches. We are now seeing clients creating behavioral science leads in their organizations and incorporating behavioral science into their research methodologies. One of the key aspects of behavioral science is to test in situation. Immersing respondents in real life size environments provides an accurate measurement of behavior. New technologies such as Virtual Reality with Eye tracking also help bring to life Richard Thaler’s work around nudges. These new technologies provide the flexibility to conduct iterative testing.

Feel free to contact us to learn more about how behavioral economics can help your marketing efforts.

Anne Stephenson
Partner, Explorer Research

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