Agency founded by Red & Yellow graduates pioneers behavioural marketing in SA

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David Perrott and Sebastian Thompson, both 24-year old graduates of Red & Yellow, have launched a specialist behavioural economics consultancy called Gravity.

Believed to be one of the first agencies of its kind in South Africa, Gravity uses the principles of behavioural economics to help marketers meet their business objectives.

The two Capetonians were exposed to the concepts of behavioural economics during a marketing and communications post-graduate course at Red & Yellow.

Here, they completed a course that included Skype lectures by international behavioural economics guru Rory Sutherland of Ogilvy & Mather UK.

“Red & Yellow inspired us with its module about behavioural economics, led by Peta Broomberg,” says Thompson. “Sitting with Rory Sutherland on Skype and asking him questions made us excited about the potential of behavioural economics in South Africa.”

Adds Perrott: “Behavioural economics is changing the global marketing landscape, but South African companies have not been sure about how to apply it to how they communicate. Lots of people are talking about it, but few seem to be building business processes around behavioural economics. We saw this as an opportunity and started the business in November 2013, whilst we were still studying at Red & Yellow.”

Behavioural economics blends economics, psychology and other disciplines to model the factors that influence consumers when they make decisions. They are influenced by a range of irrational and often unconscious factors – stereotypes, common sense, rules of thumb and other cognitive filters and short cuts – on the pathway to making a decision.

The basic idea of behavioural economics is that people may behave in ways that seem irrational at times. Yet human behaviour follows a set of principles that are consistent and predictable.

This, says Perrott, presents an opportunity to research and understand consumers’ behaviour in context, and implement nudges or interventions to influence their decision-making process. Gravity achieves this through ethnographic research, where it analyses the context in which people make decisions. Then, it recommends tactics that the client can use to influence peoples’ behaviour.

Gravity’s first client was The Big Issue – many others have followed. The agency did a pro bono campaign that aimed to help homeless people sell more of their Big Issue magazines. By observing how drivers at intersections interacted with Big Issue vendors, Gravity drew up a strategy to help them improve revenues.

One idea to emerge from Gravity’s research was to personalise each vendors’

marketing collateral to appeal to potential buyers’ empathy and prompt interaction. Each vendor would carry a hand-written board outlining his or her goal as well as how many magazines he or she would need to meet the goal. Another was to equip vendors to accept SnapScan mobile payments – shifting perceptions among their customers.

“In South Africa, we are seeing a huge need for practical and cost-effective solutions,” says Thompson. “Often brands are not communicating on the level of the consumer because they don’t understand his or her context. We want to help them close the communication gap by better understanding what interests and motivates consumers.

This will help them to achieve their business goals by helping them to understand what matters to their customers when they are making decisions.”

Peta Broomberg, marketing and advertising course director at Red & Yellow,

says: “Successful marketers need to understand human motivation and behaviour at a deep level to be able to influence it. And behavioural economics gives us powerful new ways of achieving this goal beyond the established frameworks of the past.

“We are encouraged by the success that David and Sebastian are enjoying in this field, and by the high profile they are creating for the discipline.

And we are also delighted that they have become involved in lecturing our behavioural economics course at Red & Yellow and that they are so eager to share their practical knowledge with our students. The feedback from the students is great.”

 

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