Nudge your way to higher value

Stuart E. Jackson (Vice President at LEK Consulting LLC, Chicago, Illinois, USA)

Journal of Business Strategy

ISSN: 0275-6668

Publication date: 7 September 2010

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.

Keywords

Citation

Jackson, S. (2010), "Nudge your way to higher value", Journal of Business Strategy, Vol. 31 No. 6, pp. 46-48. https://doi.org/10.1108/02756661011089071

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2010, Emerald Group Publishing Limited

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