Dan
2006 was supposed to be the year of the “Bird Flu”. Similar to Covid, there was a sudden explosion of cases popping up all across Asia. Public health experts and infectious disease specialists were desperately worried. The evidence suggested that this virus had jumped, or mutated, across species. And because our immune systems were naïve to this virus, large swaths of the population would be susceptible to it. Images from the Spanish Flu pandemic of 1918 were routinely flashed on screen on popular talk shows and evening news programs. As we all know, the Bird Flu, or H5N1 pandemic, never materialized. But in 2006, we didn’t know that. And while the emergence of Covid-19 and H5N1 were eerily similar, there were two significant differences between those two events. First, the H5N1 had not developed the ability to easily transmit itself from human-to-human. And second, there was an anti-viral medication, Tamiflu, which showed significant promise to prevent and/or treat an infected individual.
Tamiflu was an oral antiviral medicine that was approved for ‘seasonal influenza’ but showed great promise to prevent all types of influenza viral strains. It worked by blocking a protein called neuraminidase, thereby preventing the virus from replicating if taken early enough in the course of the illness. Federal and state governments moved quickly to build stockpiles of Tamiflu. And corporations, that were part of our nation’s critical infrastructure, were recommended to do the same. There was only one problem with the government recommendation: corporations weren’t stockpiling. And without prepared corporations, there were predictions of supply chain breakdowns and an overall economic meltdown. Sound familiar?
The decision to stockpile seemed obvious on the face of it: A serious, high impact global health event and an FDA approved medicine that seemed like it would be effective at blunting the virus. Roche, the maker of Tamiflu, mobilized people, including myself, and resources to help educate and prepare organizations. Millions of units of Tamiflu were produced and stored. Guidelines and resources were provided to corporate decision makers. But despite the initial interest, few corporations took the next step to stockpile. We assumed it was a matter of education on the risk / benefit. So, we ran “Big” marketing and educational programs. There was little success. After several months of frustration, we decided to try something different. To move from big, to small. Enter Behavioral Economics.
The field of behavioral economics was slowly coming into its own in 2006. Names like Kahneman, Thaler and Ariely were becoming recognizable names inside of business circles and books like Freakonomics were becoming best sellers. But it was, and to a certain extent still is, not widely practiced or incorporated into marketing and innovation capabilities. The basic point of behavioral economics is that individuals often make irrational decisions and challenge the classic belief that people have deep preferences for particular products and services; instead, our choices are heavily influenced by the environment in which we make those decisions. And because classical economics (think Adam Smith) couldn’t explain a whole lot outside of the classroom, complementary disciplines such as Neuroscience, Social Psychology and Experimental Psychology joined forces with traditional economics to better understand and design for human behaviors.
When we began promoting corporate stockpiling, we assumed that the factors that motivated a purchase decision were the most basic human motivations: Fear, Survival, Social Responsibility. But we found from our failed initial programs, that these were not the most influential levers. So we set out to design and run a series of small experiments to discover the motivating factors. To that end, we exposed decision makers from various functions and industries to a set of proposals. These proposals ranged from the high stakes implications of their actions to the micro-effects of indecision. And despite our previous experience, we were still confident that the big, existential messages would exert the greatest influence on their decision making. We were wrong. In fact, the single most effective proposal was “Your industry peers are stockpiling. And you are not.” This seemingly simple proposal prompted a significantly higher response rate for stockpiling intentions than any other single message. And as we dug into this discovery, we found that the fear of incompetence was an underlying driver. When decision-makers observed that their peers were behaving different, they had a social comparison. Social comparison is the human tendency to look to others for information about how we should think, feel, and behave. And in this case, a number of decision makers were forced to reflect on whether they were doing a good job and risked not keeping up with their peers. Nobody wants to get fired for making a bad decision. But even more so, no one wants to look asleep at the wheel. With this knowledge in hand, our team revamped our marketing and communication strategy to emphasize individual accountability and social referencing to industry peers. With a few small changes, rooted in behavioral science, we soon saw a surge in preparedness and stockpiling.
As human beings, we have tendency to be overly confident in our beliefs and opinions. Even the research our team designed and conducted, as I looked back in hindsight, had been heavily influenced by our preconceived notions. I too was guilty of this. I took a knower’s mindset and was fully complicit in the launching of big educational programs. However, by taking a behavioral economist’s view and thinking small, we encouraged stockpiling and helped build an extended network of prepared organizations for the pandemic that thankfully did not happen.
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