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Understanding the Two Systems of Thinking
- 1. SUBTITLE BELOW A different IoT
- 2. I o T
- 3. Intelligence of Two Systems
- 4. 2 + 2 = ? Experience your own 2 systems
- 5. 17 x 24 = ? Experience your own 2 systems
- 6. Feel how system 2 can control system 1
- 7. But often system 2 is not in control
- 8. Feel how system 2 can control system 1 Jack’s dad has 3 sons Hewey, Duey & . . . . .
- 9. How does your brain work?
- 11. At the end of this test, I ask a question. Don’t stop and think about it Answer immediately! How much is:15 + 63 + 5689 + 212 + 5375 + 2625 + 5263 + 32 I Know! Calculations are hard work. But it’s nearly over. Come on, one more… 123 + 5 QUICK! THINK ABOUT A COLOR AND A TOOL! Thoughts are quickly depleted
- 12. Thoughts are quickly depleted
- 13. System 1 is automated Winner
- 14. System 1 is automated BA Winner
- 15. Winner System 2 needs Focus & Attention BA
- 16. BA Winner System 2 often lives in the illusion of control
- 21. Situational Factors Context Environment Emotions Personal factors Marketing Decision System 1 System 2 Behavior Context, Emotions, Environment
- 23. Behavioral data has become abundant
- 24. Situational data has become abundant Emotions Preference Environment Context
- 25. How to recognize the systems? Situational factors Preference A gift History An expensive product Habit Context Shopping list app Buying something for yourself Alone With others Environment Rainy Sunny Empty store Busy store Emotions Slow heartbeat Fast heartbeat Sad or neutral Angry or extremely happy (always on)(lazy controller) System 1System 2
- 26. How to recognize the systems? Situational factors Preference A gift History An expensive product Habit Context Shopping list app Buying something for yourself Alone With others Environment Rainy Sunny Empty store Busy store Emotions Slow heartbeat Fast heartbeat Sad or neutral Angry or extremely happy (always on)(lazy controller) System 1System 2
- 27. How to recognize the systems? Situational factors Preference A gift History An expensive product Habit Context Shopping list app Buying something for yourself Alone With others Environment Rainy Sunny Empty store Busy store Emotions Slow heartbeat Fast heartbeat Sad or neutral Angry or extremely happy (always on)(lazy controller) System 1System 2
- 28. How to recognize the systems? Situational factors Preference A gift History An expensive product Habit Context Shopping list app Buying something for yourself Alone With others Environment Rainy Sunny Empty store Busy store Emotions Slow heartbeat Fast heartbeat Sad or neutral Angry or extremely happy (always on)(lazy controller) System 1System 2
- 29. How to recognize the systems? Example indicators User flow Follow ideal paths Are all over the place Time of day Mornings Afternoon Day of week Mondays Fridays Network WiFi 3G / 4G Conversion rate High base rates Low base rates Source Direct & Long-tail search Social, Mail, Display,… Moment Right before paying Scanning and orientation Decision Important, big decision Small, automated decision (always on)(lazy controller) System 1System 2
- 30. Subconscious Fast Emotional Impulsive Conscious Slow Rational Considered System 1 System 2 Key takeaways
- 31. Situational Factors Context Environment Emotions Personal factors Marketing Decision System 1 System 2 Behavior Key takeaways
- 32. I o T
- 34. Thanks! @joostfromberg joost.fromberg@onlinedialogue.com Download these slides? => http://ondi.me/smartsummit17 Course on Consumer Psychology? => http://WheelOfPersuasion.com/Course Consultancy on how to apply Evidence Based Growth? => Joost.Fromberg@OnlineDialogue.com
Editor's Notes
- Left the house, turned my Roomba on, knowing that when I get back home my house is dust free. But, I also have a vacuum cleaner and a handy vac, and my appartment isn’t even that big. So why did I really want to have a Roomba? And why did I spend 900 euros on a robot vacuum duster, while going out to party or getting dinner has a whole different perspective? That’s because our thoughts are subjective and quite often irrational. So, today I don’t want to speak about the IoT you’re familiar with, but about a different IoT…
- The Intelligence of Two Systems. I experiment on approximately 20M people every month and everyone in this room has two brain systems made for decision-making. There’s no difference in gender, age, race or whatsoever.
- So, let’s experience it yourself. What’s the answer to this one?
- Vragen naar verschil in proces? Voel je het? Kort uitleg wat er gebeurd. Geen systeem 1-2
- Persuasion techniques and principles are key for ecommerce success. It also is an area where we can still improve a lot and where we are not depending on IT/resources or on (high) budgets: it is mainly about copy and design elements.
- So, we have two systems. System 1 and System 2. System 1 is always there, responds automatically. Doesn’t think. So when it reads Huey, Dewey it automatically responds Louie. And when it has to read out the color, it automatically reads the words. While System 2 is the lazy controller. It pops up when there are important decisions to be made, but otherwise it prefers to be asleep. You need to know about these two systems, because they require different communication. Is your customer taking a System 1 or System 2 decision? So, let’s see how they influence each other. I’m going to give you a couple of sums, please do the math without speaking. But, at the end I’m going to give you a question and I want you to respond immediately.
- And to show you how slow and easily depleted your System 2 is, let’s do a little experiment.
- So, we see that when we have System 2 depleted, we go for the automatic respons, the easy response.
- Perception-Behavior Link
- And Penny responds automatically and follows the lines
- And Sheldon needs focus and attention.
- Cookie consent? (TMG)
- So, this is how our brain works. We have a System 1 and a System 2. And we saw that different decisions, require different systems. System 2 prefers to be asleep, but wakes up when there’s a difficult task at hand. System 2 prefers to be asleep, so we live in this illusion of thought. We think that we think, but in fact we do so much based on our System 1. But, the situation is also very important!
- That also holds up for this. If you want people to behave better, and make less of a mess, make your house subtly smell like lemons.
- And what do all of these people have in common? We make up stories and the situation is extremely important.
- We make up stories, we make up reasons, we even make up thoughts.
- Why do I like to be in the digital world? Because we can measure the environment now through IoT. Humanity is unique, individual humans not so much 1) people do not have well- formulated preferences and often construct utilities in the moment (attitudes are imperfect predictors of behavior) people’s decisions can be highly sensitive to situational factors people seem to be relatively insensitive to the impact of these situational factors in shaping their behavior 2) People rely also on their memories of utility for their own past behaviors, inferring that their past actions are good indicators of their utilities. SITUATION IS EXTREMELY IMPORTANT
- And with IoT you can measure the environment, and control the situation.
- Wearables IoT Implants (0,5 million people) Everyone leaves a digital footprint
- Preference: Behavioral History (Data). Gewoonte, wat kocht je eerder. Gewoonte = System 1, geen gewoonte = Systeem 2, moet je eerder nadenken. Context: App (goal-directed). Is dit Not For Me, of Buying For Myself. Is this Top-Down, Bottom-Up. Staat het in het boodschappenlijstje van de app. Kan je ze verleiden iets anders verkopen als het druk is of rustig is in de winkel? Komt iemand hier met voorbedachte rade. Emotions: Wearables. System 1 = Hoge hartslag, System 2 = lage hartslag. Environment: bepaal hoe de omgeving is. Drukte = hoop afleiding, minder System 2. Leidt niemand af met push notifications. Meet of iemands kinderen erbij zijn, of partner? Implants (0,5 million people)
- Why do I like to be in the digital world? Because we can measure the environment now through IoT. Humanity is unique, individual humans not so much 1) people do not have well- formulated preferences and often construct utilities in the moment (attitudes are imperfect predictors of behavior) people’s decisions can be highly sensitive to situational factors people seem to be relatively insensitive to the impact of these situational factors in shaping their behavior 2) People rely also on their memories of utility for their own past behaviors, inferring that their past actions are good indicators of their utilities. SITUATION IS EXTREMELY IMPORTANT
- So, for me, IoT isn’t Internet of Things.
- It’s illusions of thought.