The nudge theory has received great attention in the last years but the majority of the applications remain limited to academic journals and lab tests. In a guest lecture at the Norwegian School of Economics, Liveworker Anne van Lieren will show students how we apply proven behavioural principles and nudges to real-world cases. In the lecture she will discuss several client cases to illustrate our best practices.

1. 1
Applying “nudge theory” in
practice
Guest Lecture at the Norwegian School of
Economics

2. 2
Applying “nudge theory” in the real world
2 3
1
Academic journals, research
and (isolated) experiments
Real world problems, contexts
and user behaviour

3. 3
What is
service design?

4. 4
Everything around
you is designed.
The chair you sit on is
designed to support you.
The shoes you wear are
designed to be comfortable or
make you look cool.

5. 5
But if you think about what
you do on an average day...

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...it’s mostly services
you’re surrounded by.
They should be designed with
the same attention to detail.
That is what we do at
Livework.

7. 7
Services are dynamic
Service Interactions
Happen between the people and the
‘touchpoints’ of the service, which are
spread out over time and space. (i.e. me
and my trip to Bergen yesterday).
Touchpoints are the way a service is
manifested and experienced by
customers (i.e. checkin in at the hotel)
Touchpoints

8. 8
We design these touchpoints

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Service design &
behavioural economics

10. 10
Organisations struggle to understand & influence behaviour
From big behavioural
changes...
to smaller challenges (that
sometimes cause large
problems)

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Irrational customer
behaviour

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Lack of knowledge or awareness
Group think/ Social norms
Low self-efficacy/ skills
Habits and routine
Many distractions - No Salience

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Behaviours
are like
icebergs
They are mostly beneath the surface.
Observations
Interviews
Cognitive biases
Behavioural Factors
(M-A-O)
Core values
Needs

14. 14
Applying behavioural
principles in design to
understand, predict and
influence customer
behaviour

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Understand
customer behaviour - part 1

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Behaviour is complex and multi-dimensional
Touchpoints
Other people
Habits &
routines
Demographics
Beliefs, attitudes
Ex- & Intrinsic
Opportunity
Motivation
Ability

17. 17
Take into account the complete context
OrganisationBusiness
User & surroundings

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Reduce fraud in
travel insurance
CLIENT CASE

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The organisational
view of fraud in a
claims process
Digital claims process

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The business
perspective
10 -15% of claims is
fraudulent

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The user’s view of
the situation
Situational cheaters that
increase the amount ($)
and items claimed

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Reduce fraud in
travel insurance
CLIENT CASE
10 -15% of claims is
fraudulent
Digital claims process
Situational cheaters that
increase the amount ($)
and items claimed

23. 23
An overview of our design process - Reducing insurance fraud
Determine
target
behaviour
1. SCOPE
Reduce fraud in
travel insurance
Digital claims
process
Situational cheaters
Situational cheater
- be honest in reporting of claim
reduce amount ($) & number of items claimed
© 2018 Livework Studio All Rights Reserved

24. 24
Understand
customer behaviour - part 2

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Behaviour is dynamic
Cheating on insurance claim
Detect the
damage
Consider
options
Decide to
claim
damage
Report
damage
online
Submit
claim
Wait for
follow up
Payout?
During afterbefore
end to end
Customer
actions

26. 26
Customer journey
Detect the
damage
Consider
options
Decide to
claim
damage
Report
damage
online
Submit
claim
Wait for
follow up
Payout?
During afterbefore
Customer
actions

27. 27
Customer move between channels
Detect the
damage
Consider
options
Decide to
claim
damage
Report
damage
online
Submit
claim
Wait for
follow up
Payout?
During afterbefore
Customer
actions
Channels
Offline
(at home or on
the trip)
Look online
or call
customer
service
Website Website Website Email
Bank
account
statement

28. 28
Behavioural factors vary over time
Detect the
damage
Consider
options
Decide to
claim
damage
Report
damage
online
Submit
claim
Wait for
follow up
Payout?
During afterbefore
Customer
actions
Channels
Offline
(at home or on
the trip)
Look online
or call
customer
service
Website Website Website Email
Bank
account
statement
Behavioural
Factors
Emotional
hot state
Values and
beliefs
Perceived
benefits
Fears and
risks
Inconsiste
ncy with
attitude
Values and
beliefs

29. 29
An overview of our design process - Reducing insurance fraud
2. ANALYSIS1. SCOPE
Determine
intervention
points
Reduce fraud in
travel insurance
Digital claims
process
Cognitive biases
increase dishonesty
in digital channels
Values and beliefs
Determine
target
behaviour
Situational cheaters
© 2018 Livework Studio All Rights Reserved

30. 30
Influencing
customer behaviour

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Behaviour follows from how people decide to act
People use two mindsets when making decisions
Instinctive
subconscious mindset
Reflective conscious
mindset

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Current measure to change behaviour are not effective
Instinctive
subconscious mindset
Reflective conscious
mindset
Fines
Financial rewards
Legislation
Information
Rules

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Influence behaviour unconsciously
Nudging:
Instinctive
subconscious mindset
Reflective conscious
mindset

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A nudge
example
Using social norms to
highlight positive
behaviour of peers to
reduce fraud, error
and debt in by UK
taxpayers.
Social norms

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Nudge example - Customer Service of Amazon
Default

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Nudge example - Reduce bicycle theft in Liverpool
Priming

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Nudge example - Public Spaces
Salience

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And many others….

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Resolve adoption problems Streamline operations Impact moments of change
Nudges are effective in services to...

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Disadvantages of nudging in a service environment

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Disadvantages of nudging in a service environment

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Disadvantages of nudging in a service environment

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Getting customers in the right mindset
Instinctive
subconscious mindset
Reflective conscious
mindset
© 2018 Livework Studio All Rights Reserved

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Micro moments of friction can switch customers to the
conscious mindset
Instinctive
subconscious mindset
Reflective conscious
mindset
Disrupt automatic
interactions
Prompt moments of
reflection
Stimulate conscious
decisions making
© 2018 Livework Studio All Rights Reserved

45. 45
A rational
override example
Uber uses a small
moment of friction to
reduce human error
and increase the
customer experience
during surge pricing.

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Example of rational override - Conscious Crossing

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Combining behavioural interventions at the right moment in a
customer journey
speed up slow down
RATIONAL
OVERRIDE
RATIONAL
OVERRIDE
NUDGE
© 2018 Livework Studio All Rights Reserved

48. 48
Reduce complaints
about penalty fares
for the national
railway
CLIENT CASE

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CLIENT CASE
© 2018 Livework Studio All Rights Reserved

50. 50
Reduce complaints for the national railway - 3 types of
interventions
CLIENT CASE
© 2018 Livework Studio All Rights Reserved

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Many iterations to get the design right
CLIENT CASE
Use different wording, phrases and visuals to get the best design
© 2018 Livework Studio All Rights Reserved

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Try it out yourself, it’s live!
CLIENT CASE
https://www.nsb.no/en/about-nsb/contact-us/penalty-fare
© 2018 Livework Studio All Rights Reserved

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Which behavioural interventions strategy do I need?

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Which behavioural interventions strategy do I need?
9 rational override strategies
17 nudge strategies
There is no magic recipe.
© 2018 Livework Studio All Rights Reserved

55. 55
Our behavioural cards can provide inspiration
© 2018 Livework Studio All Rights Reserved

56. 56
An overview of our design process - Reducing insurance fraud
2. ANALYSIS1. SCOPE
Determine
intervention
points
Reduce fraud in
travel insurance
Digital claims
process
Cognitive biases
increase dishonesty
in digital channels
Values and beliefs
Determine
target
behaviour
Situational cheaters
3. DESIGN INTERVENTIONS
Design
against key
concepts
Commitment & extra
decision points
interventions
3 rounds of iterations to
detail visuals, wording and
timing
3 interventions across
existing claims journey
© 2018 Livework Studio All Rights Reserved

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How do we measure
the effect?

58. 58
Two ways to test the effect
What do customers experience now that
the behavioural intervention(s) are added?
Do customer change behaviour due to the
behavioural intervention(s)?
Observations
RCT / A-B tests
Before-after
measurements
User interviews
Surveys
Design prototyping
NPS

59. 59

60. 60
2. ANALYSIS1. SCOPE
Determine
intervention
points
Reduce fraud in
travel insurance
Digital claims
process
Cognitive biases
increase dishonesty
in digital channels
Values and beliefs
An overview of our design process - Reducing insurance fraud
Determine
target
behaviour
Situational cheaters
3. DESIGN INTERVENTIONS
Design
against key
concepts
Commitment & extra
decision points
interventions
3 rounds of iterations to
detail visuals, wording and
timing
3 interventions across
existing claims journey
4. PROTOTYPE & LEARN
Implement
Interventions
A-B test among 6000
users showed
significant reduction
in costs claimed
Evaluate the impact on
context & user
© 2018 Livework Studio All Rights Reserved

61. 61
Behavioural Service Design - summary of our approach
Tailor-made interventions that can change customer behaviour

62. 62
Anne van Lieren
Thanks!
Please reach out if you’d like to know more.