Consuming rationally

Consuming rationallyHow flawed our thinking is, how marketing is exploiting this,

and what we can do about it

Marko Kovic

marko.kovic@skeptiker.ch

marko.kovic@zipar.org

March 20, 2016

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is not about

There’s a couple of things that I’m NOT going to do:

I Tell you what you should or should not buy, eat, etc.

I Tell you how much stu� you should or should not buy, eat, etc.

I Moralize about the negative externalities of consumer behavior.

I Pitch some food item or diet that will miraculously make you

healther and happier.

I Preach about how you can save the planet by growing tomatoes

on your balcony.

I Tell you to become a penny-pincher.

The general ideaWhat this talk is about

What I will talk about is simple:

I As consumers, we are quite irrational!

I We are bad at getting what we want!

I Even worse: We are bad at knowing what we want!

The general ideaWhat this talk is about

What I will talk about is simple:

I As consumers, we are quite irrational!

I We are bad at getting what we want!

I Even worse: We are bad at knowing what we want!

The general ideaWhat this talk is about

What I will talk about is simple:

I As consumers, we are quite irrational!

I We are bad at getting what we want!

I Even worse: We are bad at knowing what we want!

The general ideaWhat this talk is about

What I will talk about is simple:

I As consumers, we are quite irrational!

I We are bad at getting what we want!

I Even worse: We are bad at knowing what we want!

The general ideaWhat this talk is about

What I will talk about is simple:

I As consumers, we are quite irrational!

I We are bad at getting what we want!

I Even worse: We are bad at knowing what we want!

Let’s take a quiz!Meet Sandra

This is Sandra:

Figure : Say hello to Sandra.

Let’s take a quiz!Meet Sandra

This is Sandra:

Figure : Say hello to Sandra.

Let’s take a quiz!Meet Sandra

This is Sandra:

Figure : Say hello to Sandra.

Let’s take a quiz!Meet Sandra

Sandra loves playing tennis.

She began playing tennis at the age of six. By the time she was

twelve, she had already won several local tennis tournaments. At

�fteen, she began competing nationally, and she entered the junior

top 10 very quickly. When she turned eighteen, she immediately

rose into the adult top 10.

However, even though she loves tennis immensely, Sandra decided

that she doesn’t want to pursue a professional tennis career and

instead get an education.

Let’s take a quiz!Meet Sandra

Sandra loves playing tennis.

She began playing tennis at the age of six. By the time she was

twelve, she had already won several local tennis tournaments. At

�fteen, she began competing nationally, and she entered the junior

top 10 very quickly. When she turned eighteen, she immediately

rose into the adult top 10.

However, even though she loves tennis immensely, Sandra decided

that she doesn’t want to pursue a professional tennis career and

instead get an education.

Let’s take a quiz!Meet Sandra

Sandra loves playing tennis.

She began playing tennis at the age of six. By the time she was

twelve, she had already won several local tennis tournaments. At

�fteen, she began competing nationally, and she entered the junior

top 10 very quickly. When she turned eighteen, she immediately

rose into the adult top 10.

However, even though she loves tennis immensely, Sandra decided

that she doesn’t want to pursue a professional tennis career and

instead get an education.

Let’s take a quiz!Meet Sandra

Sandra loves playing tennis.

She began playing tennis at the age of six. By the time she was

twelve, she had already won several local tennis tournaments. At

�fteen, she began competing nationally, and she entered the junior

top 10 very quickly. When she turned eighteen, she immediately

rose into the adult top 10.

However, even though she loves tennis immensely, Sandra decided

that she doesn’t want to pursue a professional tennis career and

instead get an education.

Let’s take a quiz!Meet Sandra

Which of the following propositions is more likely to be true?

Proposition A:Sandra is a university student.

Proposition B:Sandra is a university student

and she plays tennis once in a

while.

Let’s take a quiz!Meet Sandra

Which of the following propositions is more likely to be true?

Proposition A:Sandra is a university student.

Proposition B:Sandra is a university student

and she plays tennis once in a

while.

Let’s take a quiz!Meet Sandra

Which of the following propositions is more likely to be true?

Proposition A:Sandra is a university student.

Proposition B:Sandra is a university student

and she plays tennis once in a

while.

Let’s take a quiz!Meet Sandra

Which of the following propositions is more likely to be true?

Proposition A:Sandra is a university student.

Proposition B:Sandra is a university student

and she plays tennis once in a

while.

Let’s take a quiz!Meet Sandra

Which of the following propositions is more likely to be true?

Proposition A:Sandra is a university student.

Proposition B:Sandra is a university student

and she plays tennis once in a

while.

Let’s take a quiz!Meet Sandra

Which of the following propositions is more likely to be true?

Proposition A:Sandra is a university student.

Proposition B:Sandra is a university student

and she plays tennis once in a

while.

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.

I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)

I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I We are making an inference based on Sandra’s biography.

I But we are forgetting about the more reliable source of

information: The base-rate probabilities.I Both propositions contain one identical base-rate:

I Pr(university student)

I Proposition B contains an additional probabilistic condition:

I Pr(playing tennis)

I Pr(playing tennis|university student) < Pr(university student)I Always!

Let’s take a quiz!Meet Sandra

What’s going on here?

I This is sometimes referred to as the base-rate fallacy [1].

I The base-rate fallacy is a type of cognitive bias.

Let’s take a quiz!Meet Sandra

What’s going on here?

I This is sometimes referred to as the base-rate fallacy [1].

I The base-rate fallacy is a type of cognitive bias.

Let’s take a quiz!Meet Sandra

What’s going on here?

I This is sometimes referred to as the base-rate fallacy [1].

I The base-rate fallacy is a type of cognitive bias.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.

I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

What the hell is a cognitive bias?

I We make inferences about the world all the time.

I Most of the time, we make those inferences automatically and

without much active reasoning [2, 3, 4].

I In doing so, we rely on cognitive heuristics.I These heuristics are very useful!

I But sometimes, they can be labeled as biases [5], because they

lead us astray...

I We make wrong inferences, and we base decisions on those

inferences.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesThe way humans think

Cognitive biases make us irrational, in a way.

I Generally, humans aspire to be instrumentally rational.

I We have preferences, and we act so as to achieve what we want

to achieve (“utility maximization”).

I Thus, we want to make rational choices.

I However, it has been recognized for a long time [6] that this

pure rational choice model doesn’t really work in reality.

I Behavioral economics [7] is trying to systematically describe

how.

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Cognitive biases matter for consumers a lot!

I “Consumption” = Acquiring some goods or services in

exchange for others.

I As consumers, we should strive to be rational.

I Knowing what we want and how much we want it (“transitive”

preferences).

I Having good reasons for wanting what we want.

I But the reality is: Our consumption habits are, largely,

irrational and the product of our cognitive biases!

I And: The whole point of marketing and advertising is to exploitthese irrational tendencies of ours!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:

I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:

I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:

I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Cognitive biasesHow they ma�er for consumers

Marketing is, in this sense, the art of nudging [8, 10].

I Nudging means choice architecture:I People can choose whatever they want in a given situation.

I But you can model the situation in such a way that a desired

outcome becomes more likely.

I This is achieved by exploiting cognitive biases.

I In virtually all consumer decisions, we are deluged with

marketing materials.

I We are nudged quite e�ectively...

I But even without marketing, we are irrational consumers!

Some examplesAnchoring

Figure : What a deal! 50% o�!

Some examplesAnchoring

Figure : What a deal! 50% o�!

Some examplesAnchoring

We are all suckers for anchoring [11, 12]!

I We are presented with an initial value – the anchor.

I The anchor is our �rst piece of information that becomes our

standard for judging.

I When presented an o�er that is below the anchor, we think

we’ve made a great deal!

I This can be a costly mistake!

Some examplesAnchoring

We are all suckers for anchoring [11, 12]!

I We are presented with an initial value – the anchor.

I The anchor is our �rst piece of information that becomes our

standard for judging.

I When presented an o�er that is below the anchor, we think

we’ve made a great deal!

I This can be a costly mistake!

Some examplesAnchoring

We are all suckers for anchoring [11, 12]!

I We are presented with an initial value – the anchor.

I The anchor is our �rst piece of information that becomes our

standard for judging.

I When presented an o�er that is below the anchor, we think

we’ve made a great deal!

I This can be a costly mistake!

Some examplesAnchoring

We are all suckers for anchoring [11, 12]!

I We are presented with an initial value – the anchor.

I The anchor is our �rst piece of information that becomes our

standard for judging.

I When presented an o�er that is below the anchor, we think

we’ve made a great deal!

I This can be a costly mistake!

Some examplesAnchoring

We are all suckers for anchoring [11, 12]!

I We are presented with an initial value – the anchor.

I The anchor is our �rst piece of information that becomes our

standard for judging.

I When presented an o�er that is below the anchor, we think

we’ve made a great deal!

I This can be a costly mistake!

Some examplesAnchoring

How we fool ourselves through anchoring:

I Preference order: Actually, I wanted to buy a Hyundai, not aBMW – but the car dealer is o�ering me CHF 5’000 o� the BMW’slist price!

I Preference generation: I didn’t plan on buying this, but I can’tpass on this great deal!

Some examplesAnchoring

How we fool ourselves through anchoring:

I Preference order: Actually, I wanted to buy a Hyundai, not aBMW – but the car dealer is o�ering me CHF 5’000 o� the BMW’slist price!

I Preference generation: I didn’t plan on buying this, but I can’tpass on this great deal!

Some examplesAnchoring

How we fool ourselves through anchoring:

I Preference order: Actually, I wanted to buy a Hyundai, not aBMW – but the car dealer is o�ering me CHF 5’000 o� the BMW’slist price!

I Preference generation: I didn’t plan on buying this, but I can’tpass on this great deal!

Some examplesAnchoring

Figure : Wow! Another great de-... wait a minute!

Some examplesAnchoring

Figure : Wow! Another great de-... wait a minute!

Some examplesLoss Aversion

Figure : Wow, 40% o� for a limited-time only? Better buy it right away!

Some examplesLoss Aversion

Figure : Wow, 40% o� for a limited-time only? Better buy it right away!

Some examplesLoss Aversion

We hate losing (out on) stu� [13, 14]!

I Losing something “hurts” us more than receiving that very

same thing.

I Avoiding loss is more important to us than receiving reward.

I Loss aversion is prominent in consumer decisions.

I By consuming something, we believe that we avoid losing some

bene�t.

I Typically, we will be induced to buy things that are

“temporarily” made cheaper.

Some examplesLoss Aversion

We hate losing (out on) stu� [13, 14]!

I Losing something “hurts” us more than receiving that very

same thing.

I Avoiding loss is more important to us than receiving reward.

I Loss aversion is prominent in consumer decisions.

I By consuming something, we believe that we avoid losing some

bene�t.

I Typically, we will be induced to buy things that are

“temporarily” made cheaper.

Some examplesLoss Aversion

We hate losing (out on) stu� [13, 14]!

I Losing something “hurts” us more than receiving that very

same thing.

I Avoiding loss is more important to us than receiving reward.

I Loss aversion is prominent in consumer decisions.

I By consuming something, we believe that we avoid losing some

bene�t.

I Typically, we will be induced to buy things that are

“temporarily” made cheaper.

Some examplesLoss Aversion

We hate losing (out on) stu� [13, 14]!

I Losing something “hurts” us more than receiving that very

same thing.

I Avoiding loss is more important to us than receiving reward.

I Loss aversion is prominent in consumer decisions.

I By consuming something, we believe that we avoid losing some

bene�t.

I Typically, we will be induced to buy things that are

“temporarily” made cheaper.

Some examplesLoss Aversion

We hate losing (out on) stu� [13, 14]!

I Losing something “hurts” us more than receiving that very

same thing.

I Avoiding loss is more important to us than receiving reward.

I Loss aversion is prominent in consumer decisions.

I By consuming something, we believe that we avoid losing some

bene�t.

I Typically, we will be induced to buy things that are

“temporarily” made cheaper.

Some examplesLoss Aversion

We hate losing (out on) stu� [13, 14]!

I Losing something “hurts” us more than receiving that very

same thing.

I Avoiding loss is more important to us than receiving reward.

I Loss aversion is prominent in consumer decisions.

I By consuming something, we believe that we avoid losing some

bene�t.

I Typically, we will be induced to buy things that are

“temporarily” made cheaper.

Some examplesLoss Aversion

How we fool ourselves through loss aversion:

I Preference order: I wanted to have lasagne for dinner. But thispizza is on sale today!

I Preference generation: I didn’t plan on buying this, but if I buythis now, I’m saving money!

Some examplesLoss Aversion

How we fool ourselves through loss aversion:

I Preference order: I wanted to have lasagne for dinner. But thispizza is on sale today!

I Preference generation: I didn’t plan on buying this, but if I buythis now, I’m saving money!

Some examplesLoss Aversion

How we fool ourselves through loss aversion:

I Preference order: I wanted to have lasagne for dinner. But thispizza is on sale today!

I Preference generation: I didn’t plan on buying this, but if I buythis now, I’m saving money!

Some examplesHalo e�ect

Figure : Those people are pretty, friendly and tidy – this must be a great

idea!

Some examplesHalo e�ect

Figure : Those people are pretty, friendly and tidy – this must be a great

idea!

Some examplesHalo e�ect

We can’t escape the brightness of the halo [15, 16].

I Some product has a number of properties.

I Some of those properties are of objective interest to us.

I If there is some a�ectively pleasant attribute about the product,

we will judge the objectively relevant properties more

favorably.

Some examplesHalo e�ect

We can’t escape the brightness of the halo [15, 16].

I Some product has a number of properties.

I Some of those properties are of objective interest to us.

I If there is some a�ectively pleasant attribute about the product,

we will judge the objectively relevant properties more

favorably.

Some examplesHalo e�ect

We can’t escape the brightness of the halo [15, 16].

I Some product has a number of properties.

I Some of those properties are of objective interest to us.

I If there is some a�ectively pleasant attribute about the product,

we will judge the objectively relevant properties more

favorably.

Some examplesHalo e�ect

We can’t escape the brightness of the halo [15, 16].

I Some product has a number of properties.

I Some of those properties are of objective interest to us.

I If there is some a�ectively pleasant attribute about the product,

we will judge the objectively relevant properties more

favorably.

Some examplesHalo e�ect

How we fool ourselves with the halo e�ect:

I Preference order: The brand name drug and the generic drug arechemically identical. But I have only heard of the company thatproduces the brand name one, so I’ll buy that drug!

I Preference generation: All my favorite musicians are using Beatsby Dre® headphones. They must be awesome, I’ll get a pair!

Some examplesHalo e�ect

How we fool ourselves with the halo e�ect:

I Preference order: The brand name drug and the generic drug arechemically identical. But I have only heard of the company thatproduces the brand name one, so I’ll buy that drug!

I Preference generation: All my favorite musicians are using Beatsby Dre® headphones. They must be awesome, I’ll get a pair!

Some examplesHalo e�ect

How we fool ourselves with the halo e�ect:

I Preference order: The brand name drug and the generic drug arechemically identical. But I have only heard of the company thatproduces the brand name one, so I’ll buy that drug!

I Preference generation: All my favorite musicians are using Beatsby Dre® headphones. They must be awesome, I’ll get a pair!

Some examplesStatus quo bias

Figure : The default subscription is 1 year? Yeah, sure, I like that idea!

Some examplesStatus quo bias

Figure : The default subscription is 1 year? Yeah, sure, I like that idea!

Some examplesStatus quo bias

We are just not that much into changing things [17, 18].

I When faced with the option of changing the status quo in some

respect, we don’t evaluate all options equally fairly.

I We are biased towards the status quo as the default option.

I We love treading the path we have treaded before!

I This is closely related to the sunk cost fallacy [19].

Some examplesStatus quo bias

We are just not that much into changing things [17, 18].

I When faced with the option of changing the status quo in some

respect, we don’t evaluate all options equally fairly.

I We are biased towards the status quo as the default option.

I We love treading the path we have treaded before!

I This is closely related to the sunk cost fallacy [19].

Some examplesStatus quo bias

We are just not that much into changing things [17, 18].

I When faced with the option of changing the status quo in some

respect, we don’t evaluate all options equally fairly.

I We are biased towards the status quo as the default option.

I We love treading the path we have treaded before!

I This is closely related to the sunk cost fallacy [19].

Some examplesStatus quo bias

We are just not that much into changing things [17, 18].

I When faced with the option of changing the status quo in some

respect, we don’t evaluate all options equally fairly.

I We are biased towards the status quo as the default option.

I We love treading the path we have treaded before!

I This is closely related to the sunk cost fallacy [19].

Some examplesStatus quo bias

We are just not that much into changing things [17, 18].

I When faced with the option of changing the status quo in some

respect, we don’t evaluate all options equally fairly.

I We are biased towards the status quo as the default option.

I We love treading the path we have treaded before!

I This is closely related to the sunk cost fallacy [19].

Some examplesStatus quo bias

How we fool ourselves with the status quo bias:

I Preference order: Yeah, I would save 20% on my premiums if Iswitched to another health insurer. But, you know, I’ve been withmy current insurer long, and I’ve never had any issues!

I Preference generation: I won’t even consider eating anywhereelse than at Mc Donald’s®; they always have adequate food therewhen I’m hungry!

Some examplesStatus quo bias

How we fool ourselves with the status quo bias:

I Preference order: Yeah, I would save 20% on my premiums if Iswitched to another health insurer. But, you know, I’ve been withmy current insurer long, and I’ve never had any issues!

I Preference generation: I won’t even consider eating anywhereelse than at Mc Donald’s®; they always have adequate food therewhen I’m hungry!

Some examplesStatus quo bias

How we fool ourselves with the status quo bias:

I Preference order: Yeah, I would save 20% on my premiums if Iswitched to another health insurer. But, you know, I’ve been withmy current insurer long, and I’ve never had any issues!

I Preference generation: I won’t even consider eating anywhereelse than at Mc Donald’s®; they always have adequate food therewhen I’m hungry!

Now what?How to become a less irrational consumer

Get over it: You’re an irrational consumer!

I We su�er from cognitive biases.

I Cognitive biases make us consume irrationally.

I Marketing is adding to that irrationality.

Now what?How to become a less irrational consumer

Get over it: You’re an irrational consumer!

I We su�er from cognitive biases.

I Cognitive biases make us consume irrationally.

I Marketing is adding to that irrationality.

Now what?How to become a less irrational consumer

Get over it: You’re an irrational consumer!

I We su�er from cognitive biases.

I Cognitive biases make us consume irrationally.

I Marketing is adding to that irrationality.

Now what?How to become a less irrational consumer

Get over it: You’re an irrational consumer!

I We su�er from cognitive biases.

I Cognitive biases make us consume irrationally.

I Marketing is adding to that irrationality.

Now what?How to become a less irrational consumer

Get over it: You’re an irrational consumer!

I We su�er from cognitive biases.

I Cognitive biases make us consume irrationally.

I Marketing is adding to that irrationality.

Now what?How to become a less irrational consumer

Is all hope lost?

I Yes: Cognitive biases are simply how we think.

I No: There’s some evidence that we can “debias”!

Now what?How to become a less irrational consumer

Is all hope lost?

I Yes: Cognitive biases are simply how we think.

I No: There’s some evidence that we can “debias”!

Now what?How to become a less irrational consumer

Is all hope lost?

I Yes: Cognitive biases are simply how we think.

I No: There’s some evidence that we can “debias”!

Now what?How to become a less irrational consumer

Reducing the impact cognitive biases have on us is possible [20].

I There are, generally, two strategies to do so.

1. Learn about the problem!

2. If you can’t beat ’em, join ’em!

Now what?How to become a less irrational consumer

Reducing the impact cognitive biases have on us is possible [20].

I There are, generally, two strategies to do so.

1. Learn about the problem!

2. If you can’t beat ’em, join ’em!

Now what?How to become a less irrational consumer

Reducing the impact cognitive biases have on us is possible [20].

I There are, generally, two strategies to do so.

1. Learn about the problem!

2. If you can’t beat ’em, join ’em!

Now what?How to become a less irrational consumer

Reducing the impact cognitive biases have on us is possible [20].

I There are, generally, two strategies to do so.

1. Learn about the problem!

2. If you can’t beat ’em, join ’em!

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

Learn about the problem!

I You are doing the �rst step by listening to me here!

I If you take cognitive biases seriously, you are likely to increase

deliberate thinking and reduce fast thinking a bit.

I But you can also use one simple tool that will help you out a lot!

I Before you engage in a consumer transaction, do the following:

I Write down your preference order (all available alternatives,

from least to most desired).

I Write down the reasons for having the preferences you have.

I This may sound silly, but it’s going to work.

I Making yourself actively think about what you want to do and

why you want to do it is, essentially, the idea of cognitive

behavioral therapy [21, 22].

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I We are all susceptible to cognitive biases.

I Marketers are using that to their bene�t.

I So why not make our weakness our strength?

I Go nudge yourself!

I In�uence your own routinized decisions by engaging in choice

architecture.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I We are all susceptible to cognitive biases.

I Marketers are using that to their bene�t.

I So why not make our weakness our strength?

I Go nudge yourself!

I In�uence your own routinized decisions by engaging in choice

architecture.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I We are all susceptible to cognitive biases.

I Marketers are using that to their bene�t.

I So why not make our weakness our strength?

I Go nudge yourself!

I In�uence your own routinized decisions by engaging in choice

architecture.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I We are all susceptible to cognitive biases.

I Marketers are using that to their bene�t.

I So why not make our weakness our strength?

I Go nudge yourself!

I In�uence your own routinized decisions by engaging in choice

architecture.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I We are all susceptible to cognitive biases.

I Marketers are using that to their bene�t.

I So why not make our weakness our strength?

I Go nudge yourself!

I In�uence your own routinized decisions by engaging in choice

architecture.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I We are all susceptible to cognitive biases.

I Marketers are using that to their bene�t.

I So why not make our weakness our strength?

I Go nudge yourself!

I In�uence your own routinized decisions by engaging in choice

architecture.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

Now what?How to become a less irrational consumer

If you can’t beat ’em, join ’em!

I “Self-nudging” is actually something I’m working on.

I Classical nudging is paternalistic [10, 9].

I Self-nudging is not.

I Some ideas for self-nudging:

I An easy one: Before making decisions about food spending,

make sure you are not hungry – hunger will make you more

irrational [23].

I Exploit the status quo bias to your bene�t and adjust default

options.

I For example, don’t sign contracts that automatically renew.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

SummaryWhat this was about

Take home messages:

I Our minds make heavy use of cognitive heuristics.

I Oftentimes, these heuristics are unhelpful biases, because they

make us make wrong inferences.

I Cognitive biases are a large part of consumer behavior.

I Thankfully, we are predictably irrational [24].

I Cognitive biases are systematic biases.

I We can do something about them.

I By being more aware of our biases and by nudging ourselves,

we can become more rational consumers.

That’s it! Thank you!

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