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Posted 12th December 2016 | Category: CustomerExperience

Recently I had the privilege of attending a conference by Citizen's Advice on Behavioural Economics and Utilities Switching Behaviour. The various speakers from industry, academia and regulatory bodies were each expert in their area, well-spoken and undoubtedly well-meaning throughout. However, I was struck by the extent of Groupthink that prevailed in the room.

The presupposition was that consumers were irrational for not switching energy suppliers. They gave evidence for the amount of savings that could be made by switching energy supplier. On average, each individual could save £300 a year, so, they said, not to engage in the switching agenda must be irrational.

As just putting this information out to the public had resulted in paltry numbers of consumers switching despite millions of pounds being spent on advertising campaigns revealing the amounts to be saved through switching, the conclusion was that consumers were just being irrational - this word was used a great deal to describe consumers that day. Unspoken was the lofty notion that The Establishment knew better than individual consumers what was best for them.

Faced with the persistent lack of public appetite for switching these well-meaning public bodies are now proposing that those who have not switched energy supplier in the last, say, three years will be compelled to opt out if they do not wish their contact details to be given to alternate energy supply sellers. Surely the ICO advice that best practice is to have sales contact information set to opt in rather than opt out should apply in this case as much as any other? Why are they so disrespectful of the public that they must brand it irrational for the overwhelming majority of the public to reject the switching agenda? Would it not be better - and indeed more rational - for the Establishment to acknowledge the value judgements that the public has made?

They tested Nudge techniques to help shift the disengaged to switch suppliers. (Nudge is behavioural economics speak for justifiable manipulation of peoples' behaviour by reframing the context or mechanism of their choice options.) None of the Nudge techniques tested showed any significant effect on switching behaviour. There was little consideration given to the possibility that maybe consumers were being perfectly rational, had considered the options and decided that saving up to £300 a year was not worth the trouble!

I was strongly reminded of the revolutionary uproar created by the Scottish psychiatrist R D Laing in the '60s when he suggested that sometimes what the medical establishment called madness was a pragmatic - and perhaps sane - response to living in an insane environment (like a child being brought up by an unreasonable, narcissistic parent). Laing's insistence on trying to see apparently 'insane' behaviour in the context that generated it and looking from the perspective of his patients served to reframe the way we now view mental illness and treatment.

Behavioural science can offer us better insights as well as Nudge options, insights on factors that aid and bias decision making such as priming, framing, anchoring and attribution effects as well as give clarity on how to shape and influence customer choices through brand and service experiences. But it starts with not discounting the consumers' perspective, even when it's not what we want to hear, acknowledging it as valid and reshaping our offering showing respect for consumers' perspective.

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