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Nudge your way to higher value

Nudge your way to higher value Purpose – This paper aims to discuss an approach to strengthening sales and customer relationships by making it easier for customers to buy from you. Design/methodology/approach – Building on the work of Richard H. Thaler and Cass R. Sunstein in the book Nudge , the paper acknowledges the importance of “choice architecture” in human decision‐making. It then applies the concept to business situations and develops five lessons for executives and strategy officers to apply to their own companies. The author uses case studies of companies successfully optimizing choice architecture in the areas of industrial products, business services, retailing and consumer services. Findings – The key lessons from the case studies are in five areas: maximizing visibility and personal interaction with customers; using service personnel to support sales efforts; removing barriers to purchasing; simplifying customer decision‐making; and optimizing web site interactions. Originality/value – The key message of this paper is that small changes in the way a product is offered to customers can have a disproportionate effect on customer buying behavior. Companies and executives who understand the role of choice architecture in buying behavior will be well positioned to out‐perform peers and deliver incremental value to shareholders. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Business Strategy Emerald Publishing

Nudge your way to higher value

Stuart E. Jackson
Journal of Business Strategy , Volume 31 (6): 3 – Sep 7, 2010
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Publisher
Emerald Publishing
Copyright
Copyright © 2010 Emerald Group Publishing Limited. All rights reserved.
ISSN
0275-6668
DOI
10.1108/02756661011089071
Publisher site
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Abstract

Purpose – This paper aims to discuss an approach to strengthening sales and customer relationships by making it easier for customers to buy from you. Design/methodology/approach – Building on the work of Richard H. Thaler and Cass R. Sunstein in the book Nudge , the paper acknowledges the importance of “choice architecture” in human decision‐making. It then applies the concept to business situations and develops five lessons for executives and strategy officers to apply to their own companies. The author uses case studies of companies successfully optimizing choice architecture in the areas of industrial products, business services, retailing and consumer services. Findings – The key lessons from the case studies are in five areas: maximizing visibility and personal interaction with customers; using service personnel to support sales efforts; removing barriers to purchasing; simplifying customer decision‐making; and optimizing web site interactions. Originality/value – The key message of this paper is that small changes in the way a product is offered to customers can have a disproportionate effect on customer buying behavior. Companies and executives who understand the role of choice architecture in buying behavior will be well positioned to out‐perform peers and deliver incremental value to shareholders.

Journal

Journal of Business Strategy – Emerald Publishing

Published: Sep 7, 2010

Keywords: Consumer behaviour; Decision making; Consumer marketing; Sales

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