‘You better cut the pizza in four pieces because I’m not hungry enough to eat six’
Yogi Berra

The way a task is presented affects people's willingness to take it on and complete it (or not!) Something presented as one long task will be less likely to engage people than something that is efficiently 'chunked up' into bite-sized’ mini tasks. Used frequently in  behavioural economics, and cognitive psychlogy, ‘chunking’ involves grouping smaller, disparate elements into a sequence or categorizing a process into sections or ‘types’  to make it easier for people to comprehend, retain information, or make a sustained change in behaviour. 

An oft cited example,  by many practionioners, is one that involves applying this concept of ‘chunking’  to help people complete the course of medication  precribed to them. There  is a huge risk incurred, for example, when people fail to complete courses of antibiotics. Instead of giving people, the entire course of antibiotics and asking them to take, say 22 tablets, twice daily,it might be better to ‘chunk’ this down. Giving them, say, 10 white pills and 12 blue ones and telling them to take the white pills first followed by the blue ones, the likelihood of people completing the entire course increases significanlty. 

In FMCG, the Skin Care category has leveraged this understanding remarkably well, to help simplify an incredibly complex multi step skin care regimen by ‘chunking’ products into cleansing–toning–moistirizing–whitening–anti ageing or day and night routines, helping people make sense of an unimaginable & impossible range of products and routines to use & follow in the quest for what they deem to be great skin.

In retail, IKEA is one of the players that does a brillaint job of helping consumers navigate their almost impossible  product range by ‘chunking’  them into rooms, & themed spaces that make browzing manageable and the dwell time engaging, both online and in-store, often resulting in people leaving IKEA with more than what they had intended to purchase ! 

Chunking has also been extensivey used in the context of not just learning & communication, but also when dealing with complex goals like qutting smoking, adopting healthier meals, better financial planning , better everyday hygiene etc, by helping break a larger goal into simpler, more platable, doable, organizable & trackable smaller steps.  

In a TED video about the 'Art of Choosing'  psycho-economist Sheena Iyengar describes the ‘deer-in-headlights’ paralysis that people experience when faced with an overwhelming choice  and/or information overload. If those same choices & that same  information is organized well, and presented in a manner that people can effectively process and ‘consume’ , it leads to smoother  & more satisfying decision making.  In the midst of the Coronavirus crisis and the economic fallout, for example, some trading platforms did a tremendous job of  ‘chunking’ the various stocks contextually as ‘stay at home services stock’,‘work from home services stock’, ‘online learning stocks’ to help people make sense of the chaos and guide their decision making process efficiently. 

Brands are constantly striving to be more relevant and meaningful in the lives of people they want to engage with. In this endeavor they often end up overstuffing their audiences's, media & screen environment that is already bulging at its seams. If they truly want to matter to their audiences, it might be important for them to classify, organize, categorize, collate, and chunk all that content & solutions into manageable, palatable, portions that uniquely & culturally make sense to people they are serving it all to.  
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A book with its thoughts clearly organized into chapters is, after all, easier to make sense of,  than all the discrete 61000000 words that go into making it . 

Making a commitment publicly, or to another person (ideally, someone you respect & whose validation matters to you) seems to reduce the gap between our intention and action, and help overcome the possible temptations that could detract us en route to our goals.  The more public our position, the more likely it seems we are,  to follow through with it.

We are all familiar with perhaps one of the oldest commitment contract, aka marriage, where people gather together to raise the stakes of the vows being made, and make it more binding for the involved parties to avoid easily ‘backing off’ from the commitment made. 

Wharton behavioral economist Katherine Milkman and her collaborators tested the efficacy of ‘pre commitment strategies’ in prompting people to get vaccinated. It turned out that specifying & committing to someone the exact time and place when and where they will get vaccinated resulted in measurably better follow-through.

Dean Karlan, a Yale economics professor, teamed up with his colleague Ian Ayres to create a online business based on the concept of making a public contract to achieve goals. They call their platform, Stickk.com and it gives people the option of making a public commitment, financial or nonfinancial. With financial commitments, an individual puts up money and agrees to accomplish a goal by a certain date, also specifiying how to verify that s/he has met their goal. If the person reaches the goal set, s/he gets their money back. If they fail, the money ether goes to charity, or is dsitributed amongst people who reach their targets, or is sent to the sports team the person hates (adding to the motivation of sticking to one’s goals). The nonfinancial commitments include peer pressure (emails to family or friends giving them details of your successes or failures) or making one’s journey public via a dashboard accessible to all in your circle of significant others.

Positive Labelling is another way through which commitments can be made public. Singapore, often called the ‘nudge nation’ uses  publically visible ‘labels’ to encourage people to adopt desired behaviours. A publically visible label that says ‘I am a part of the Kindness movement’, ‘or  I recycle’  or ‘I scrub my hands for more than 20 seconds while washing’  to not only adopt but also sustain the desired behvaiour change.  
 
Many marketers have the wherewithal to use this dimension of human psyshology to encourage behaviours that are both expressive of the brand’s purpose as well as bevaiours that would create a positive dent in culture.  Patagonia, for example, contributes $100,000 annually to The Conservation Alliance. They also work towards preserving lands and a life outdoors. Patagonia’s commitment is very public, and its activities to make that commitement an everyday reality, steadfast. Another favorite, REI, also walks the talk when it comes to issues of conservation, sustainablity, and equality. It publicly commits to goals, and thereby opens itself for scrutiny by the public at large.

On a more topical issue, the COVID 19 crisis, this week saws some brands getting it right. Brands like Coca Cola who have publically declared it would suspend all marketing activity in key markets in response to economic changes wrought by the pandemic, Diageo pledging 2 million litres of alcohol for sanitiser, to BBC Global News, freeing 20% of its advertising inventory for use by international health and government organisations wanting to promote public-health messages around Covid-19, Gojek CEOs pledging to donate 25% of salaries to drivers and other partners facing loss of income, or LVHM deciding to  use cosmetics and perfume manufacturing facilities to make free alcohol-based sanitizer amid global shortage.
 
As human beings, we seek to be consistent with our promises & love the applause and validation that comes from sticking to our course (and hate the flak that comes with being seen as deviating from what we committed to). Aided and abetted by various technologies that offer new ways of publicising and socialising commitments, brands should make the right public commitment to become more meaningful in the lives of people they want to build a relationship with. And stand the scrutiny of delivering against it, and be rewarded for it. Or bear the consumer’s wrath of falling short, and be held accountable for it.
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The lesson, in short? Make it public!

In 2010, the popular New York eatery, Serendipity 3’s introduced a $69 hot dog called ‘Foot-Long-Haute-Dog’ with Exotic dressings & gained plenty of publicity when the Guinness Book of World Records certified it as the most expensive wiener of all time. The true purpose of this overpriced item, however,  was to make the next most expensive item on the menu seem cheaper. Customers who were drawn by the Haute Dog’s publicity ordered the menu’s $17.95 cheeseburger in droves, driving record sales for the store.

Some years earlier. Serendipity 3 offered a $1000 ‘Golden Opulence Sundae’ that was only available with a 48 hour-notice. They sold only one Sundae per month. Nevertheless, it intrigued customers who then, compared the $1000 sundae to 'less expensive options' such as the $15.50 'fruit and fudge' confection or the $22.50 'Cheese Cake Vesuvius' and helped drive their sales, all the while completely convinced that they were getting a great deal, with the most expensive item acting like an anchor against which everything else seemed ‘reasonable’

The assumption that people carefully weigh all pros and cons, and make decisions rationally, is one the biggest myths that existed in the field of economics and marketing. The reality is that more often than not, people unconsciously latch onto the first fact they encounter, basing their decisions on that first fact, irrespective of its accuracy, in a demonstration of a phenomenon called Anchoring Effect.

In 1974, psychologists Tversky and Kahneman published 'Judgment under Uncertainty: Heuristics and Biases' documenting the first clinical evidence of the Anchoring Effect. They described an Anchoring Effect experiment which challenged two groups of high school students to complete a lengthy multiplication problem. One group was given 5 secs to estimate the answer to  1 x 2 x 3 x 4 x 5 x 6 x 7 x 8. The other group was given same time to solve this : 8 x 7 x 6 x 5 x 4 x 3 x 2 x 1. The Anchoring Effect led the students whose problem started with lower numbers to estimate lower. While the students who solved the problem in reverse anchored to the higher numbers, resulting in a higher estimate. Each group was unduly affected by the first numbers they saw.
 
The Anchoring Effect has been extensively used to influence response to pricing, promotions, subscriptions, negotiations, customer service training. Telling a customer, for instance, that a wait time to get a table is 30 min, and then saying that it is available in 20 mins. makes them happier than if you were to tell them that the wait time is 15 minutes, and then having to tell them to wait another 5 minutes. In both the scenarios, the final wait time is the same, but the customer satisfaction levels widely different.
 
Anchoring Effect is a significant reference point, guiding & effecting our decisions way more strongly than we’d like to accede. While anchoring has often been used to drive profits & sales, one of the strongest & most sustainable, anchoring points to use in marketing, is the Brand’s Purpose & the values it stands for (should stand for).  As people get bombarded with information in this overstuffed, over communicated media environment, keeping the Brand’s Values and Purpose, front, back and Centre, as a constant, will help audiences, follow these values, through their path to purchase.

​Remember that when it comes to decision -making, it’s often about the first thing people see.

​The biggest fallacy in marketing is assuming that people are rational and their decisions, logical.  If it were so, the feelings invoked by losing something or gaining something (of equal value) should be the same. We should feel as pleased with a $100 gift as we feel bad that we have lost $100. But this is never the case .Psychologists have found that we feel a loss about twice as severely as we experience a gain. Feeling the pain of loss more acutely than feeling the pleasure of gain leads to people trying to avoid a loss more than trying to pursue a similar gain, a behavior called Loss Aversion.  Or as the Psychologists, Kahneman & Tversky, said, “Losses loom larger than gains”
 
Loss Aversion in the service of Environmental Protection. Tatiana Homonoff, from Decision Lab, UK, tested the theory of loss-aversion by assessing whether charging a tax of $0.05 (penalty) had a bigger impact on plastic bag reduction than offering a bonus (reward) of the same amount. Her results show that plastic bag used declined by 42% after the tax was implemented but did not change in the bonus treatment, evidence consistent with a model of loss aversion. Loss aversion explains why penalty frames are sometimes more effective than reward frames in motivating peopl, and encouraging desired behaviours . 
 
Loss Aversion for a Better Version of Yourself.  The website Stickk allows people to publicly commit to a positive behavior change (avoid binge drinking, save for retirement, run for  30 mins everyday etc). The goal-setting platform, created by behavioral economists at Yale University, uses a Commitment Contract, “a binding agreement you sign with yourself to ensure that you follow through with your intentions, and it does this by utilizing the psychological power of loss aversion and accountability to drive behavior change. By asking users to sign Commitment Contracts, Stickk helps users define their goal (whatever it may be), acknowledge what it’ll take to accomplish it, and leverages the power of putting money on the line to turn that goal into a reality”
 
Loss Aversion Helping Close The Sale. Leveraging Loss Aversion is how SUPREME, went from a small skateboarding store in New York to an $1 billion street-wear company with a cult-like following among teens.The retail value of Supreme's clothing isn't much, but once the items sell out, (which they always do, by design) they begin to increase in value, creatinga huge resale market and hype sparked by.
 
Looking to reduce shopping cart abandonment rates, a problem that results in lost revenue for almost every retailer, the flower delivery service, 1-800- Flowers, implemented a push notification strategy to bring potential buyers back to the app to finish a purchase.Sending promos to users over push notifications, the company was able to increase abandoned shopping cart conversions by 350% above the industry average. 
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Loss aversion is an extremely powerful tool catalyst to behaviour change. One time discount, limited offers, flash sales etc are commonly used tactics by marketers to advance sales The key is to leverage this understanding with a strong ethical compass in hand , to avoid inciting fear or plaguing on people’s insecurities, to use it to strengthen your brand’s equity and purpose, focussing on positive behaviour change, that help people achieve their goals, for their greatest good.

​Nah, that’s not me, you say?  If you’ve ever looked at reviews before buying something, or considered ratings on TripAdvisor before booking your holiday, or bought a fidget spinner for your kids, or chosen to eat at a resturant that is full versus one that is empty, or recently bulk ordered toilet rolls in the light of the coronavirus scare, you most certainly have experienced ‘Group Think’/ the Mob Effect / The Herd Effect. Whether we acknowledge it or not, the fact remains that we are deeply influenced by what others do.
 
In 2008, Professor Jens Krause and Dr. John Dyer of Leeds University conducted an experiment where groups of subjects were told to walk in a random path inside of a big hall while not communicating with the other subjects. However, the researchers told a few of the subjects exactly where they should walk.They discovered that the people who were told exactly where to walk started being followed by the subjects walking “randomly.”“We’ve all been in situations where we get swept along by the crowd. But what’s interesting about this research is that our participants ended up making a consensus decision despite the fact that they weren’t allowed to talk or gesture to one another. In most cases the participants didn’t realise they were being led by others”, said Prof Krause.In the end, they found that it took just 5% of people walking confidently to influence 95% of the other walkers to follow them.
 
While the Herd Effect has precipated unsavory behaviours (actual mobs !), and crisis such as the Dot Com Bubble and  stock market crashes, not everything that comes out of  it is bad.  It can be an extremely powerful Nudge guiding positive decisions and actions. Marketeers , have of course, understood and used this psychology to prod people along their paths to purchase. 
 
Pampers, the diaper brand from P&G, for example, drove increased consideration by showing how many other ‘mothers like you’  placed their faith in Pampers.  Olay overcome the barrier of decreased relevance at various e-coomerce platforms by demonstrating how many other ‘women like you’ chose Olay to answer their skin care problems.
 
Amazon has built up such a review powerhouse that 30% of ecommerce shoppers go to Amazon just to research products, basing much of their decision on such peer reviews. Other methods of leveraging such social proof include  ‘Best Sellers”, “Most Popular” page, “Choice of XXX people”  
 
Singapore, uses the Herd Effect, habitually, to nudge people to adopt positve behaviours. The Public Utilities Board, for example, encourages people to conserve water & electricity by having the monthly utility bills display how your energy consumption compares to your neighbours, gently nudging people to not exceed the ‘avergae’. Public Service campaigns regularly shine light on behaviours they want people to emulate by showing a ‘collective’ of people performing the desired action.
 
Human race is a herd. We find comfort in numbers, and  with people with whom we have something in common. While Herd Metality is often associaited with negative emotions & outcomes, it is a powerful nudge that can be used to accelerate adoption of postive goals.