Behavioural Economics in B2B Marketing

Behavioural economics in B2B

marketingWhy it’ll change what you do,

and how you do it.

This presentation is about Behavioural Economics and why it’s important to all those who work in B2B marketing.

In addition, we outline some key concepts that are relevant to B2B● How we decide: two ways of thinking● Framing ● Perception – and what this means for making decisions● Choice architecture● Goal drivers – do we align to something our audience

cares about

Overview

www.earnest-agency.com

Context: we’re in the business of persuasion

“Open this email”

“Come to this event”

“Download this whitepaper”

“Follow us!”

“Buy my stuff”


So how’s that going?

Too often we miss the mark

And when something works, we have no real idea why it worked…


People are really weird

We try and be rational.

We try to reason with people.

But people are people.

Most of the time, they’re not rational or even reasonable.

Proof: persuasion is predictably unpredictable

Vs

Which works best?Just evoking a robot smile is bizarrely more likely to make us slow down (and stay slow) than the very rational threat of £120.

We’re all under pressure

for accountability

We use DATA to tell us

WHAT works.

But we still have nothing that helps

us understand WHY

B2B marketers: we have a problem…

What is it?Behavioural Economics mixes human psychology and neuro-science to scientifically test what people do under certain decision-making scenarios, and from this understand why people do what they do.

This field of study has led to a Nobel Prize (Daniel Kahneman), and most importantly for us, a scientific framework to use in marketing – all based on empirical evidence and the science of how decision-making is determined.

And what it is not:● Some bizarre form of human manipulation● A silver bullet

This is where Behavioural Economics comes in

Other terms you’ll hear bandied

around

Neuro-marketing

Decision science

Buyer psychology

The science: three uncomfortable truths



WHY? WHY? WHY?

In 20,000 years of evolution, our DNA is (nearly) the same. Deep seated, unconscious thoughts thousands of years old still govern our behaviour.

Behavioural economics studies have proved this, and given real clarity to how we make decisions and what our real motivations are.

So if you’re in B2B marketing, why would you not want to know more?

There is a huge amount of material available

● Research papers● Books● Blogs● Articles

We think there a few key concepts established by behavioural economics that are particularly relevant to B2B.

Getting practical: concepts that are relevant to B2B marketing

And these are:

Goal drivers: universal drivers that decide how our marketing is accepted (or not)

Choice architecture: too much, too little, and we’re lost

Perception: how we decode the world around us

Framing: how our objective view is always subjective

But underpinning all this – two systems of thinking


What did you think about this morning?

What tasks & actions did you do?

Were they the same?

A science-based framework for marketing

Source: D Kahneman. Thinking Fast and Slow

This is how our brains like to operate

Source: D Kahneman. Thinking Fast and Slow

Some scary stats


Which means our top priority is:

Engage system 1, not just system 2

Cognitive ease

How should we, in marketing, make it easy?

Language

‘Descriptively obvious’ headlines, titles etc

Say it once, say it twice, say it thrice and so on

Being a ‘system 1’ marketer: some things we can all change tomorrow

Simple clear language actually helps thought leadership, expert positioning

and consultancy-led selling and positioning

Follows the language point. But if we make people think too much,

people skip and move on

Repetition aids believability, reduces perceived risk and moves a brand or

message into the auto-pilot

Answer: use the most important frame available. Your brand!

How can we use framing in marketing?

Brand

Product

Brand

Product

Brand

Product

Why is the brand frame of almost unlimited value?

● From our days in the jungle, we’re scared of change.● Repetitive familiarity breeds trust● Brands create that repetitive familiarity● It’s an anchor – allowing us to land new products,

services etc

Behavioural economics proving the value of brand investment…?

Cognitive ease

Buyable!

Brand

Repetition

Familiar

Framing and our terrible ability to make decisions

14%

86%

0%

Here’s what happened when The Economist

launched three subscription packages.

Framing and our terrible ability to make decisions

86%

14%

Here’s what happened when they

removed the middle one.

Choice architecture

Choice architecture

Goal drivers

“To understand people one needs to understand what leads them to act as they do, and to

understand what leads them to act as they do one needs to

know their goals.”

Consumer goal driver framework

Source: P Barden. Decoded

Consumer example: goal alignment to differentiate product parity

Source: P Barden. Decoded

Earnest Goal Matrix: Implicit Goal Drivers in B2B

Progress

Stimulation

Recognition

Avoidance

Obligation

Control

PR

OM

OT

ION

PR

EV

EN

TIO

N

I need to do this to get ahead

I need to do this to learn / because it looks interesting

I need to do this to look good

I need to avoid losing out / losing something

I need to do this because it’s expected of me

I need to do this to stay in control

Gain an advantage over others; Lead the field

Personal discovery; Learning experience;

Receive acclaim; advance career

Be secure; Prevent losses; Avoid threats

Need to comply; fulfill promises; Be true to my

word

Stay on top; Maintain status quo; Be

empowered

Go-getter

Status seeker

Adventurer

Worrier

Controller

Box-ticker

Implicit goals Primary driver Motivations Persona

•A scientific input to everything we do

•Less subjective debate

•Do stuff (propositions, brands, campaigns, offers) that actually work

Or even:Fundamentally change the perception of marketing?

Summary: why is all this important

Conclusion

Some further reading

Thinking fast and slow D Kahnemann

Predictably Irrational Dan Ariely

DecodedPhil Barden

Interesting?


@earnestagency

Http://blog.earnest-agency/blog

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Behavioural Economics in B2B Marketing