As much as technical innovation, the application of behavioural science has been central to the success of the FANGs (Facebook, Amazon, Netflix and Google), an industry figure maintains, as they minimise cognitive load through constant testing of the consumer experience – something that is essential for any business wanting to innovate.
In a WARC Best Practice paper, How Amazon, Netflix and Google use behavioural science to simplify the user experience, Richard Chataway, a Vice President at BVA Nudge Unit UK, observes how techniques such as auto-completing queries and the use of recommendation engines are derived from aspects of behavioural economics like System 1 thinking, heuristics and choice satisficing.
“Consumers want experiences that cost them the least cognitive effort,” he notes; being able to deliver those drives revenue for the platforms that employ them.
And, he adds, creating those experiences depends not on modelling or forecasting, but “ongoing, real-world testing” to understand consumers.
“The key for any company looking to innovate is to make some form of experimentation a constant,” he states.
The most innovative companies run thousands of experiments every year and while most are destined to fail they still provide insights for progress – and the big wins more than compensate for the failures.
Even something as apparently simple as the shade of blue used to show results in the Google toolbar is a result of testing over 40 different shades to see what generated the most clicks, Chataway points out – and this optimisation is estimated to have generated over $200m in additional annual revenue.
“Businesses seek competitive advantage above all else, and a scientific approach to changing behaviour can drive progress and innovation to deliver that,” he says.
“But whether that is achieved by academically robust experimentation, or simply adopting a mindset of continuous testing and learning, hypothesising and deducing – and accepting failure as part of a ‘growth mindset’ – is largely irrelevant.”
In a WARC Best Practice paper, How Amazon, Netflix and Google use behavioural science to simplify the user experience, Richard Chataway, a Vice President at BVA Nudge Unit UK, observes how techniques such as auto-completing queries and the use of recommendation engines are derived from aspects of behavioural economics like System 1 thinking, heuristics and choice satisficing.
“Consumers want experiences that cost them the least cognitive effort,” he notes; being able to deliver those drives revenue for the platforms that employ them.
And, he adds, creating those experiences depends not on modelling or forecasting, but “ongoing, real-world testing” to understand consumers.
“The key for any company looking to innovate is to make some form of experimentation a constant,” he states.
The most innovative companies run thousands of experiments every year and while most are destined to fail they still provide insights for progress – and the big wins more than compensate for the failures.
Even something as apparently simple as the shade of blue used to show results in the Google toolbar is a result of testing over 40 different shades to see what generated the most clicks, Chataway points out – and this optimisation is estimated to have generated over $200m in additional annual revenue.
“Businesses seek competitive advantage above all else, and a scientific approach to changing behaviour can drive progress and innovation to deliver that,” he says.
“But whether that is achieved by academically robust experimentation, or simply adopting a mindset of continuous testing and learning, hypothesising and deducing – and accepting failure as part of a ‘growth mindset’ – is largely irrelevant.”
Sourced from WARC
