Thursday, September 22, 2016

When Being Below Average Is A Good Thing

"If you're the smartest person in the room, you're in the wrong room"
I had the privilege to spend 2 months this summer working, along with 6 other incredible humans, as a research scholar under the Center for Advanced Hindsight led by Dan Ariely. Our goal was to apply behavioral economics insights to help below-median income families - via working with and advising to fin-tech companies.
This post was inspired by the people I lived and worked with during that time.

Humans are herd animals. It's a survival mechanism - and it does it's job well. The fundamental idea is "everyone is doing X, and they seem to be not dead - hence it's probably a good idea and I should do that as well so that I won't die either" - especially if those who are doing X are alpha specimens (famous, successful, "cool" etc.). At it's core this concept is simply "learning by observing others" and it's one of humanity's greatest superpowers - but, like many other evolutionary traits, it sometimes backfires in modern society.

One popularized example is peer pressure in school. People often imagine a situation that goes something like this: a bunch of "cool kids" are doing something "wrong" (smoking?) and are actively pressuring the shy "good boy" to join them in their evil deeds by phrases like "come on - everyone is doing it". Contrary to this popular belief, the "cool kids" usually don't actively pursue the shy boy - they don't talk to him at all - which is pretty much the problem. The kid, wishing to be part of the herd, looking for social approval - especially from those perceived as dominant specimens, emulates them on his own accord. Social pressure is often self inflicted. 

In fact, it is so self inflicted that it works even when there is 0 chance of actual repercussions. In a famous research by Dr. Cialdini and his team, it was shown that trying to convince households to reduce electricity consumption via "standard" arguments like "save money", "protect the environment" etc. doesn't work - but applying virtual peer pressure by saying (for example) "77% of your neighbours use less electricity than you" works great. No one would ever know whether you've actually reduced energy consumption or not - there is 0 risk of social backlash - but peer pressure is engrained so deeply into our mental "operating system" that it works anyway.
OPower was founded on the premise that social proof - as well as other behavioral principles (also known as human hacks) - can be used for good. OPower focuses on convincing utility consumers to use less (mostly electricity), and they seem to be onto something - since they were recently acquired by Oracle for more than half a billion dollars.

So, what else can we use social proof "hacking" for? We can imagine social pressure as an almost physical force that drives human behavior towards the average:

The horizontal axis represents some human quality or a tendency for a certain behavior, while the vertical axis shows the relative popularity of said quality/behavior in the group/society.

And it works pretty much on every aspect of life. It influences the way we dress, the way we talk, the way we prioritize time and career choices, etc. etc. - mostly on a subconscious level. Sometimes this psychological effect works in our favor - and sometimes it doesn't.
Imagine you're a talented and passionate musician. Unfortunately, you happen to be a teenager at the moment. It means you have to overcome peer pressure every time you choose to practice instead of engaging in leisurely activities - because "working when you don't have to" is an uncommon behavior. You are on the right side of the curve, so the social force pulls you back - away from your goal and your passion.

So what are your options? 
You can resolve to put up with the pressure and keep on doing your own thing - which is impressive but often quite hard and takes a lot of emotional energy.
You can give up - surrendering to the social forces and become average.
But what can you do to make social proof work for you - not against you? Let's hack the situation and move the curve to your right - making the social pressure push you forward. How?
By changing your surroundings.
By choosing to associate with like minded people, who understand the value of music and are at least as passioned as you are. You'll be pushed onwards simply by being around them.

So that's what I did.
For 2 months I was surrounded by very driven and talented people who knew a lot more than me about social research, behavioral field experiments and how to be a consultant. Obviously, I've learned a great deal from working together. Even more importantly - I've internalized some of their intuition, worldview and faith in the power of behavioral economics.

Until next time, may you surround yourself by people who push you forward.


It's a great feeling when you ask something like "would the color of the button put the user in a defensive mindset - thus lowering conversion rates down the funnel?" and your coworkers don't look at you like you're crazy... :)

{If you find my ideas or analysis interesting - consider subscribing (box on the right). You'll never miss a post and I'll know I'm not talking only to myself :) }


  1. How stable is the model of pushing toward the mean when you look at a population with say defined network of relationships, and how stable it is with respect to its topology. Also, it seems there are interesting potential game theory questions here.

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