Upon entering the bar, the Behavioral Economist orders a drink. He then overhears two guys talking about their new tech-startups, and the trials they've had over the past week - having user interface problems, customer retention, and even worse, lack of engagement for their products.
You may be wondering what a Behavioral Economist is and what they do. Simply put, a Behavioral Economist studies the effects of psychological, cognitive, and emotional factors on economic decision-making. This includes things like how people make choices, how information is processed, and how emotions affect spending and saving habits.
So why should a startup, or anybody for that matter care?
Behavioral Economics can be used to nudge customers into making certain choices. For example, if you are a diet app-startup, you may want to use Behavioral Economics to nudge customers towards choosing healthier options when logging food.
Behavioral Economics can also be used to design better products and services. By understanding how people make choices, you can design products and services that are more user friendly and that meet customer needs.
And finally, Behavioral Economics can be used to understand consumer behavior. This is important for startups because it can help you better target your marketing efforts and understand what kinds of products and services people are likely to buy.
At the end of the conversation, the Behavioral Economist left the two founders with new insights on how to implement these tools into their own businesses.
To learn how behavioral economics can help your tech-startup, you can contact us here.