This is the title of a new eBook I just finished with Alia McKee and Mark Rovner of Sea Change Strategies. It’s a guide to behavioral economics for nonprofit leaders and in here is why you should be reading it: You will be seeing behavioral economics everywhere this year. It’s the topic of a slew of business books – and it should be the topic on the minds of everyone in nonprofit marketing and fundraising, too.
As we explain in the eBook, behavioral economics challenges the notion that people will choose the best action or the most logically presented choice and explores the bounds of rationality — identifying social, cognitive and emotional factors that can influence the decisions people make. The big takeaway? People don’t arrive at most decisions through a process of weighing costs against benefits. We are irrational. In their book Nudge, Richard Thaler and Cass Sunstein put it simply: Real people make decisions like Homer Simpson, not Spock.
So why is behavioral economics important to nonprofit organizations? For us, these irrational decisions have high stakes. We’re not asking people to buy a Coke. We’re asking them to protect our environment, to safeguard our children, to fight for human rights. We’re asking them to change the world. Their individual decisions — which often don’t take into account one’s own best interest let alone the interest of the greater good — matter a lot. We need to be sure we’re asking people in the right way, or their Homer brains might undo our Spock arguments.
Learn how to deal with all the Homers out there! Get the eBook for free here.