Behavioural Psychology Marketing

The controversial science that claims to have revolutionised economics. For centuries, economics was dominated by the idea that we are rational individuals who optimise our own ‘utility’. Then, in the 1970s, psychologists demonstrated that the reality is a lot messier. We don’t really know what our utility is, and we care about people other than ourselves. We are susceptible to external nudges. And far from being perfectly rational, we are prone to ‘cognitive biases’ with complex effects on decision-making, such as forgetting to prepare for retirement.

Spread through the public in the form of popular stories, ideas can go viral and move markets - whether it's the belief that tech stocks can only go up or that housing prices never fall. Whether true or false, stories like these - transmitted by word of mouth, by the news media, and increasingly by social media - drive the economy by driving our decisions about how and where to invest, how much to spend and save, and more. But despite the obvious importance of such stories, most economists have paid little attention to them. Narrative Economics sets out to change that.

Designers and managers hope their products become essential for users-integrated into their lives like Instagram, Lyft, and others have become. Such deep integration isn't accidental: it's a process of careful design and iterative learning, especially for technology companies. This guide shows you how to apply behavioral science—research that supports many products—to help your users achieve their goals using your product.