Ray Poynter gave a presentation on behavioral economics. He discussed key themes of behavioral economics like rational vs actual consumer behavior. He also covered cognitive biases and heuristics discussed in behavioral economics research like priming, anchoring and framing. Poynter emphasized implications for market research, including focusing on context and whether decisions are personal or social. He recommended considering behavioral economics concepts when designing market research.

1. An Introduction to Behavioural Economics
19 April 2012
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

2. Agenda
1. The context for Behavioural Economics
2. Key themes
3. Implications for market research
4. Further reading
5. Closing thoughts
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

3. Rational
Consumers
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

4. Wages are
sticky
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

5. Psychology
Cognitive Psychology
Social Psychology
Evolutionary Psychology
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

6. Ultimatum Game
Originally proposed by Güth, Schmittberger, and Schwarze
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

7. We are to thinking as cats
are to swimming
we can do it if we have to
Daniel Kahneman
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

8. System 1 and 2
System 1 System 2
– Make a disgust face when – Focus on one person’s
shown horrible picture voice in a crowded room
– Calculate 2+2=? – Fill out a tax form
– Drive car on empty road – Walk faster than is normal
– Detect that one object is for you
more distant than another – Compare two washing
– Complete the phrase machines for overall value
“Bread and ……” – Look for a woman with
white hair
From Daniel Kahneman’s Thinking Fast and Slow
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

9. Context
Dan Ariely
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

10. Default and Inertia
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

11. Rating Problem
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

12. Priming, Anchoring, Framing
How expensive do you think a business return
flight from London to New York in May will be?
______
What would you expect to pay for an
economy return flight from London to Paris
in May?
(pick the answer closest to the number in your mind)
a. Less than £40 a. Less than £100
b. £40 b. £150
c. £80 c. £200
d. £120 d. £250
e. £160 e. £300
f. More than £200 f. More than £300
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

13. Implications for Market Research
1. Back to basics
– Research is a psychological instrument
– Experimental design
– Consistent relationship between response & action
2. Key elements
– Context
– System 1 or 2
– Is the decision personal or social?
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

14. Further Reading
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

15. 4 Thoughts
1. Don’t throw the baby out with the
bathwater
2. The issues raised by BE are reasons to use
professional researchers, and a risk for DIY
3. Don’t just use a technique you’ve used
before, think about why and how it might
work?
4. Of all the points BE raises, context is
probably the most ‘powerful’
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

16. Thank You
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

17. Q&A
Sue York Ray Poynter
NewMR Vision Critical
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1

18. Ray Poynter and Vision Critical
1-7 Boundary Row
London, SE1 8HP
United Kingdom
Phone: +44 (0) 20 7633 2900
T: @RayPoynter
L: http://www.linkedin.com/in/raypoynter
Speaker: Ray Poynter, VCU @ Vision Critical, UK
NewMR Behavioural Economics Event, 19 April 2012, Session 1