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Business Daily
Why you buy what you buy
00:21:23
How behavioural science shapes the money decisions you don't realise you're making
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- [00:00]
BBC Podcast Advertiser
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- [01:18]
Rowan Bridge
Hello, I'm Rowan Bridge and this is Business Daily from the BBC World Service. Today I'll be drawing back the curtain to show how everyone, from toothpaste brands to the United nations are using science to influence your choices in ways you're probably not even aware of.
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Ben Jones
The authority bias is the tendency we have to align our opinions or our behaviors with someone we see as an authority or an expert on something. And some businesses can draw on this through things like endorsements. You know, dentists recommending toothpaste, athletes endorsing sportswear.
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Rowan Bridge
I know my patients are going to.
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Dentist
Come back happier and for me, that's everything as a dentist.
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Rowan Bridge
That's all coming up on Business Daily from the BBC. Your last name, please. Welcome to Nudge stock marketing giant Ogilvy's annual pow wow about behavioral science, run by their consulting business.
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Charles Spence
You just want to work straight through that little alley there, and then on the right is the main hall with all the talks.
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Rowan Bridge
500 people have paid the equivalent of more than $650 to be here. Also, they can better understand how human psychology can help them and their companies.
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Dean Ward
Hello, everyone.
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Rowan Bridge
Welcome to Nutstock 2025. The title of the event's a nod to the 1960s music festival Woodstock, and it's been described as Glastonbury for nerds.
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Rory Sutherland
I'm going to start by absolving someone of a crime that was committed about 6.
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Rowan Bridge
If this is Glastonbury, then Rory Sutherland's one of the headliners. Ogilvy's vice chairman, he founded its behavioral science team, and he says the ideas being used now have been around for at least a couple of thousand years.
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Rory Sutherland
I would argue that there's quite a lot of behavioral science in the Bible. For example, I mean, the parable of the lost sheep is, if you like, a story about loss aversion going back even further. And I think this is about the seventh century B.C. there's Aesop. Undoubtedly, one of the first behavioral scientists worthy of the name was Aesop himself. If you look at Aesop's fables, quite a lot of them are effectively illustrating the quirks and foibles of effectively human feeling and behavior and reaction. So it's a very, very old field of study.
- [03:29]
Rowan Bridge
I don't have any audio from 2000 years ago, but I do have some. From almost 80 doctors in all parts of the country were asked, what cigarette do you smoke, doctor this ad was part of a Camel cigarettes campaign from the United States which ran in the 1940s. The rather jarring language of a doctor endorsing smoking shows how far attitudes have changed. But long before advertisers were using terms like Behavioral Science, R.J. reynolds, the tobacco company behind came understood the power of authority figures like doctors to shape choices. And you can hear the echoes of that ad still today, like in this one for toothpaste.
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Dentist
I recommend to my patients Sensodyne complete protection.
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Rowan Bridge
Plus, I know my patients are going.
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Dentist
To come back happier.
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Taqwa Khalifi
And for me, that's everything.
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Rowan Bridge
As a dentist, some of these ideas have been around for decades. But it's only more recently that interest in how to harness the power of behavioral science has really taken off. And now everyone from McDonald's to the United nations is using it. So listen up as I show you how your actions and choices are being shaped by the hidden hand of behavioral science. So let's start off with those cigarette and toothpaste ads. They're both using what's known as authority.
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Ben Jones
Bias, the tendency we have to align our opinions or our behaviors with someone we see as an authority or an expert on something.
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Rowan Bridge
Ben Jones is from the Behavior Architects, a firm which uses behavioral science to better understand why people make the choices they do.
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Ben Jones
When we're unsure, we don't know what to do, it's kind of easy to follow the lead of those who we think are credible or knowledgeable. It's a mental shortcut. It's something that helps us navigate uncertain times or make quick choices. We start doing that from an early age. Our parents, for some people, it's our teachers. You know, these people help us learn and make sense of the world. And some businesses can draw on this through things like endorsements, you know, dentists recommending toothpaste, athletes endorsing sportswear.
- [05:25]
Rowan Bridge
Hello? Hello, it's Rowan Bridge. I'm here to see Dean Ward. Okay, one second. I'll say this is Evoke Creative in Northwest England. If you ever paid for parking, taken out a library book or ordered a burger from McDonald's, you might well have used their products. They make those self service terminals you now see everywhere. The company was co founded by Dean Ward. We're in your manufacturing plant here, but in front of me I could be in a McDonald's. This is the touchscreen ordering screen that people will be familiar with. If you've gone in any of the fast food branches, there's the pay points at the bottom. So this is what you built for McDonald's. Just explain a bit about the behavioral science of how it works.
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Dean Ward
Firstly, the psychology of speaking to someone and feeling judged we think is a key factor. So would you like extra fried? Would you like to go large? Not all people, but I think there's definitely a large proportion of people who may feel judged in those instances and may say no. There's the fact that you've got more time to look. You can see the product, you can see what's in it, you can see other products linked to it as well and also around upsell as well. Would you like to add this? Would you like to do that? Because you've got more time and you're not being judged, you're very much more inclined to actually say yes to these things. And that's typically what we're seeing. An increased basket spend of typically 25, 30%.
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Rowan Bridge
Behavioral science also impacts other areas of what you eat. Believe it or not, the shape of chocolate will shape how you taste it. It sounds like an urban myth, but don't take my word for it.
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Charles Spence
So I have a Cadbury dairy milk chocolate bar in my hand. You can probably hear it rattling. I shall now open it up and see what we have inside.
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Rowan Bridge
This is Charles Spence from Oxford University. He's a professor of experimental psychology and studies how people perceive the world around them.
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Charles Spence
We do a lot of studies where I give people things of different tastes to taste, different flavours and get them to pick shapes and sounds and Colours and all sorts of stuff to match a particular taste. We find time and again that sweet is round, bitter is more angular. And we think the underlying logic might be that when you taste sweetness, it kind of comes on gradually and tends to linger. So a bit like a round shape, where something sour, say, comes on in an instant and it's gone and you match sourness with sharpness, sharp, pointy shapes. Or it could also be that if you break milk chocolate, it doesn't have as an angular form, as dark chocolate tends to break into sort of shards and maybe our brains have picked up. If I see a very angular piece of chocolate, that means it's probably dark chocolate and hence the association might come from there as well.
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Rowan Bridge
So you don't know for sure exactly what drives it?
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Charles Spence
No, no, no.
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Rowan Bridge
Don't know for sure.
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Charles Spence
I know for sure that it exists. And it works. Not always. It depends exactly what sort of chocolate you're working with.
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Rowan Bridge
It's not just the shape of food which can influence your experience. You're also subconsciously impacted by the environment around you when you buy it. You might think your choice of wine in the supermarket, for example, is entirely yours, but it appears not so much.
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Charles Spence
Classic study from Adrian North. In a supermarket back in the 90s, he had the wine aisle, which had French and German wine alternating, and he just alternated day by day or week by week, whether there was French accordion music playing in the background or German music playing. I just looked at what people bought. The first thing he found was that about 75% of the wine sold on French music days was French and only 25% German bottles sold. And those numbers reversed. So most of the wine sold was German when they had the music in the background. And then the second thing was when people came away from the counter having bought their wine, he would ask them, well, why did you choose French wine today? And amazingly, virtually nobody was aware that it was. The music was having an effect. They would all say things like, you know, I was going to make beef bourguignon. And so it had to be some French wine to match the food.
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Rowan Bridge
You're listening to Business Daily on the BBC World Service. I'm Rowan Bridge. And today, how the choices you're making are shaped by forces you're not even aware of. It's not just companies that are harnessing the power of behavioral science. Governments are too. So that is basically now recording. Okay, when you press the red button, this is Cass Sunstein. Now, you might not know his name, but you may well have been influenced by him, even without realising his day job is as a constitutional law professor at Harvard University, one of America's most prestigious academic institutions. But he's also one of the founders of what's known as nudge theory. The idea that by offering people the right incentives or prompts, you can use behavioural science to influence what they'll do. As well as co writing a best selling book about it, he also got to put the theory into practice as part of the Obama Admin.
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Cass Sunstein
One thing that I'm particularly enthusiastic about is we have a program to get poor kids to have free school meals. It's a legal mandate that if you're poor you get free school meals. And a number of parents didn't sign up their kids and that's terrible because it's nutritious meals and it saves them money. And we did something called direct certification where kids who are eligible and known to be eligible are automatically enrolled in that program. And that is has been serving millions of children who are getting free school meals.
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Rowan Bridge
Governments around the world have tried to harness the power of nudges.
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Dean Ward
Someone once said that politics is of course showbiz for ugly people. So on that basis I feel like.
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Rowan Bridge
I really arrived by rather fresh face. David Cameron in 2010. At the time he was the leader of the UK Conservative Party and within months would be Prime Minister. His speech was called the Next Age of Government and he's clearly enthralled by how government could use the ideas of behavioral science.
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Dean Ward
Let me just give you one example that I think is incredibly simple and I love. We want to get people to be more energy efficient. This is a simple piece of behavioral economics. The best way to get someone to.
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Rory Sutherland
Cut their electricity bill is to show.
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Dean Ward
Them their own spending, to show them what their neighbors are spending and then show what an energy conscious neighbour is spending. That sort of behavioral economics can transform people's behaviour in a way that all the bullying and all the information from a government cannot possibly achieve in power.
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Rowan Bridge
David Cameron created the Behavioral Insights team, what became known as the Nudge Unit. It was one that Professor Sunstein liaised with.
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Cass Sunstein
And what we would talk about is exactly what we know about people and how they do well and maybe not so well and what kinds of freedom preserving approaches might help them make choices that will be better for them. Automatic enrollment and savings programs where if you shift from, people opt in if they want to save a little more for retirement or they're automatically enrolled and could opt out. That is a terrific example of behaviourally informed approaches to public policy.
- [12:22]
Rowan Bridge
The Reason auto enrolment in pensions massively boost take up is what's known as default bias and you might have an example of it sitting in your pocket. Do you have an iPhone? I'm not a betting man, but I'd say the odds were pretty high that if you do, your ringtone is this. That's the default that the phone comes with. Here's Ben Jones from the Behavior Architects.
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Ben Jones
Generally, it's our tendency to go with the option that's already selected or the option that's already presented to us as the default setting. And that's partly because we make thousands of decisions every single day. And defaults are one of those things that just helps us manage that overload of choices we're always having to make. And one of the big success stories for defaults is automatic enrolment in pension schemes across the world.
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Rowan Bridge
If auto enrolment in pensions had the power to transform people's future, then another piece of behavioural science has had a major impact on the present.
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Rory Stewart
Previous ministries have been discussing it for seven or eight years and kept coming up with hypothetical problems.
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Rowan Bridge
Rory Stewart is a writer, broadcaster and former politician. Ten years ago he was a minister in the UK government and introduced the plastic bag tax in England. It started as a 5 pence charge for plastic bags in supermarkets aimed at cutting plastic pollution and reducing single use plastic use. As Ben Jones from the Behavioral Architects explains, the impact isn't caused just by the fact people are now paying a small amount for plastic bags.
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Ben Jones
Sometimes it's not just about the money and lots of times when we're thinking about making changes, we think about social norms and following the behaviour of other people. And when these norms are really clear and widely shared, they can really strongly influence behaviour and they can be changed as well. So when a behavior comes to be viewed as socially responsible or considerate, people often change what they do to align with that expectation as well.
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Rowan Bridge
At the time, the idea provoked negative headlines in some British newspapers.
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Rory Stewart
It was amazing though, all the explanations of how it would come to the.
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Ben Jones
End of the world.
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Rory Stewart
I mean, the Daily Mail I think was running headlines saying plastic bag chaos. My boss at the time, Liz Truss, wanted to have nothing to do with it. She passed this thing to me because she thought it was really going to alienate the Conservative voter base. I mean, she, and being a cannier politician than me, she thought, you know, this is something you can do. So I felt very honored to be able to take through something that seemed a sort of pretty uncomplicated good. But it didn't feel like that in the political atmosphere of the time.
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Rowan Bridge
The impact was dramatic. In front of me I've got an official document from the government called Single use plastic carrier bags. Charge data for England 2024-2025. Now, not exactly a snappy title, but if you look through it, there's some astonishing data buried in there.
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BBC Podcast Advertiser
It says our data indicates that based on this year's return, there's been a decrease of almost 98% in the annual number of single use carrier bags of sold by the main retailers. That's more than 7.4 billion fewer bags since the charge was introduced.
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Rory Stewart
Astonished? Absolutely. I mean it was, it went much better than we could have expected and it didn't have the other impacts. I mean the, you know, there were anxieties from the supermarkets and retailers that it would reduce people buying from them. It had much bigger impact, reduced the number of bags much more quickly than we expected and did so with none of the worst case scenarios, which now seems slightly implausible. I mean, it's actually even talking to you now, it's quite difficult for me to fully remember why for seven years nobody had done this, because of course once something succeeds everybody thinks, well, it's.
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Rowan Bridge
Obvious that nudge unit I talked about earlier on still exists, but now it's an independent company offering advice to governments around the world. Its real name's the Behavioral Insights Team. One of its projects was a WhatsApp chatbot aimed at increasing the take up of COVID vaccine boosters in parts of Argentina. Monica Willis Silver is the director of international programs for Europe, the Middle east and Africa. She showed me how they used behavioral science to shape how it worked.
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Dentist
One of the things that we wanted to address is something that in behavioural science is called the intention action gap or the planning fallacy, which essentially means that we're really good at visualizing our goals and what we want to achieve, sort of our intention. We're terrible at planning how we'll get there. And so we introduce an element of something that we call implementation intentions, which is essentially getting people to think and plan very carefully what they'll do when and how by prompting them through questions.
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Rowan Bridge
In the chat, they ultimately tried three versions of the bot.
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Dentist
One version was just implementation intentions getting people to plan. The second one was the vaccine locator and seeing if that additional development was worth it. And then the third one is we wanted to test what we call messenger effects to see if who delivers the message makes a difference. And for that purpose we had a rock star In Argentina called La Mosca work with us to develop a song. So it's a song that is really well known in Argentina as muchachos. And then he did a version for us for vaccines to get people to vaccinate again. That last bit of the song is saying we're gonna vaccinate again, which is essentially making a reference to the we're gonna win the World cup again. So if you talk to anyone in Argentina, I think they will know the song. So he's basically inviting people to go get the vaccine. So the third version had the personalization implementation intentions, the vaccine locator and then the additional messenger effect of La Moska take up quadrupled.
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Rowan Bridge
But the numbers were small. It went from 0.35% to 1.44%. Nevertheless, that was seen as a success. Behavioral science has even made its way into TV drama. This is the opening to the Tunisian TV comedy drama Sala Sala, which means Slowly, Slowly. It's set in a restaurant and the dramas that go on in and around the family that run it. It was the fourth most watched show in the country when it aired. But its inspiration came not from a TV production company but but the United Nations World Food Program. The show aimed to encourage people to eat family dinners together as a way of improving people's eating habits and reducing bread waste.
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Taqwa Khalifi
We try to use some innovation and some creativity in order to change behaviors because you know, facts only doesn't change like people and doesn't change behavior. We all know better, but we don't do better.
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Rowan Bridge
Taqwa Khalifi is from the United Nations World Food Program in Tunisia.
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Taqwa Khalifi
So we needed something really creative and really different to think outside of the box or to let people see themselves in those stories. Because people are learning and changing by imitating and modeling and observing others behaviors and others actions and emotional reactions to things. So this is why we tried this project or try this product or this TV series with Ogilvy Paris in order to impact people and develop something creative where people they can see themselves in, it relates to their reality, it relates to their everyday things and so on. So we said here we can make a change with that. So maybe we can like make an impact on food waste and reduce and. Exactly, that's what happened.
- [19:58]
Rowan Bridge
The UN says following its broadcast a third of families reported eating together more and there was a 22% drop in bread consumption. Plastic bags, food waste, pensions, all of them have shown the impact behavioural science can have. But even its supporters acknowledge there are limits. Some changes may only move the dial a bit. But its supporters say even that can be significant. But one of the godfathers of behavioral science, Cass Sunstein, changing the default from.
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Cass Sunstein
Opt in to opt out often has a very large effect on outcomes. So that's kind of a prize winner. Educative or informational interventions typically have a smaller impact, but across a large population, if you get the percentage of people who are, let's say say eating healthy up a little bit, then that can mean a certain number of people don't die and it's not, you know, going to transform humanity, but hooray for that.
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Rowan Bridge
And when it comes to government, behavioral science can also run up against the hard realities of politics. Rory Stewart, the man behind England's plastic bag tax.
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Rory Stewart
I mean, so my next thing is I tried to do it on non disposable coffee cups and was immediately put back in my box. So after the success of plastic bag tax, I came out and in reply to a statement, House of Commons, I said I was now looking at it and this was the moment which I got called by Liz truss and number 10 and everyone said enough already, stop, shut up, don't continue down this track. I can only speculate that it's one of two things. Number one, they must have come under pressure from some manufacturers, probably of the cups. And the second thing I think is this sense that they didn't want me as a minister attracting too many headlines. They didn't want a story of here's this sort of active environmental campaigning young minister, because it didn't seem sit with whatever story they were trying to sell into the next election.
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Rowan Bridge
At the same time, the latest figures from the UK government and highlighted by the environmental group Planet Patrol show sales of plastic bags increased last year, though they're still way down from before the plastic bag tax. Governments, the United nations companies, they're all using behavioral science to try and change what you do. It's probably helped shape your choices and decisions in ways you might not previously have even been aware of. But hopefully this cancer through behavioral science has helped lift the curtain just a little bit and made you think about what you do and what might really be influencing those choices.