Cautiously Optimistic

A book I can highly recommend is “Nudge: Improving Decisions About Health, Wealth, and Happiness” by Richard Thaler and Cass Sunstein. I even included a link to their blog on my blogroll.

I have to confess that I didn’t seek out the book on my own. Rather, I was assigned to write a book report about it in a consumer behavior class I took in grad school.

But boy was I glad I read it. The authors lay bare the ways that companies gently guide consumers to behave, and consume, in ways that are more profitable for them.

Nudges are not outright coercion, just subtle prompts that rely on mental inertia to do their work for them.

Amazon.com is famous for nudging customers toward ordering at least $25 worth of merchandise in order to qualify for free shipping. You don’t have to; they’re just letting you know.

But once you’ve ordered the minimum in order to get free shipping, the checkout page nudges you toward paying the standard shipping fee. You have to actively select free shipping in order to get it. That’s how nudges work. They rely on people taking the path of least resistance.

Recently I was filling up the tank at a gas station and realized I was being nudged.

Note how the cartoon finger is pressing the button on the right (click to enlarge), which of course is where the super-premium gasoline is dispensed. I was free to press any button, but I bet that just enough folks take the path of least resistance and select the most expensive grade of gas. Why not? It’s so easy. But taking the path of least resistance is often the most costly path.

So stay aware of how companies “helpfully” suggest options, and remember that no one has your best interests at heart the way you do.