Saturday, February 18, 2012

Thinking, Fast and Slow

One of the most important consumer behavior books on the market today is Thinking, Fast and Slow by Nobel Prize winner Daniel Kahneman.

The Wall Street Journal, The Economist, and The New York Times are among the publications that named this a top pick in 2011. Why? Because Kahneman explains how we think about the world, often in irrational fashion, which in turn affects how we make decisions, why we rely on intuition, how we often fail to balance emotions with logic, and finally--why we sometimes disregard or discount vital data.

In other words, we need to learn how to get our "slow thinking" mind working alongside our "fast thinking" mind.

For example:

  • How do consumers judge whether a price is too high or too low? Anchoring (see p. 119).
  • Why do so many marketing plans fail to achieve some of their market-share objectives--and what can marketers do to anticipate problems? Competition neglect (see p. 259) and premortem (see p. 264).
  • How do consumers prioritize uses for their money? Mental accounts (see p. 342).
  • Which is more compelling: Preventing a loss or pursuing a possible gain? Frames (see p. 363).
Kahneman's insights are important for marketers and consumers alike. Highly recommended!

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