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Q

&A

How do you define ‘nudge marketing’?

Nudge marketing is all about structuring a consumer choice

environment to get the consumer to do a certain thing. The

issue is, we can think about ‘consumer behaviour’ as a series

of single decisions or actions; or we can think about it as a

constellation of behaviours that eventually lead to an out-

come, down the road. Using the latter definition, nudge mar-

keting is just one piece of the puzzle: It essentially focusses

on the first step of consumer behaviour. If you think about

consumer behaviour more broadly, you can do a lot more to

influence positive long-term outcomes.

You have found that nudging has a dark side. Please ex-

plain.

The problem is, as a methodology, nudging often stops

short. Vanguard is one of the biggest retirement plan ad-

ministrators in the U.S. In 2015, 61 per cent of the people who

joined their retirement savings plan signed up for automatic

enrollment — which is a classic nudge. These consumers ba-

sically said, ‘Take this amount of money from my paycheque

every month’.

A marketing expert argues

that nudging is a powerful

tool — but that it shouldn’t

be used in isolation.

Interview by Karen Christensen

QUESTIONS FOR Utpal Dholakia, Professor of Marketing, Rice University