How to Make Better Creative Decisions – Backed by Behavioral Economics

At Lexicon Branding, we have the pleasure of working with an immensely diverse portfolio of clients – from engineers at new-to-the-world startups, to seasoned C-Suite executives at Fortune 500s. At the end of our creative naming process, each of our clients is faced with the task of choosing one name that will carry their brand’s story into the marketplace. Simply put, decision making lies at the heart of our business.

Behavioral economics, the study of psychology as it relates to the economic decision-making, can help explain the science behind human decision-making. We make millions of decisions in a single day, and simply don’t have the time or cognitive power required to analyze each choice in a meticulously rational fashion. One of the common tactics we use to facilitate decision-making and limit this cognitive load is heuristics — shortcuts that we rely on to simplify and quicken problem-solving and decision-making. Recruiting heuristics can be helpful to quickly make a choice, pass judgement, or solve a problem, but can be damaging if they consequently make us ignore certain information and/or think irrationally, known as having cognitive bias.

With over thousands of creative presentations given to clients, we’ve observed several commonly occurring heuristics and cognitive biases that hinder the creative decision-making processes of our clients. We will first provide a definition of these biases and explain what they can look like in the context of a creative decision. Then, we’ll provide several tips that you and your team can use to help make creative decisions more seamless, efficient, and above all, rational!

Heuristics & Cognitive Biases

Take-the-best-heuristic: When we make a routine decision that requires a choice between several options (i.e., choosing which coffee to order at a coffee shop or choosing which shirt to buy), we typically settle on an option by a process of elimination. Often, this means we recruit the take-the-best heuristic, a shortcut where we rely on only one cue or characteristic to serve as our differentiator to base our decision on 1.

For instance, if we were trying to choose which shirt to buy at a store, a traditional, rational decision-making process would mean we evaluate each shirt’s strengths and weaknesses and carefully consider which one would be the best option based on, say, price, material, style, fit, and versatility (homo economicus, I’m looking at you). However, we’re far more likely to choose a single factor to compare the shirts (hence the name ‘take-the-best’). If I decide fit is the most important factor, I will choose the shirt that fits me best regardless of the price, material, style, and versatility.

The problem arises when we recruit the take-the-best heuristic when making a significant creative decision. We simply cannot treat all decision-making the same; buying a shirt is not the same as picking a new name for your brand. Why? Since a name will affect your brand’s performance in the marketplace and perception in the eyes of your consumers, it is necessary to evaluate each name based on its potential effectiveness in the marketplace. This requires a deep, analytical evaluation based on questions such as:

Does this name support my brand story?
Is the name distinctive in the category?
Is the name expansive? Can it expand past the current offering?

Solution: Take the time to stop and think about how you are analyzing names and what you are actively considering when comparing names. If you find yourself comparing names based on one factor, it’s time to go back and expand your criteria for analysis. Before eliminating any names from a list, try itemizing the positives. Each solution that Lexicon presents will do something unique for your brand, so eliminating names should not be a rash decision.

Bandwagon Effect: You’ve probably heard of a “bandwagon fan” before in the context of sports: someone who becomes a fan of an athlete or team solely because they’re successful and favored by many people. The bandwagon effect can be observed in nearly any setting where decision-making is taking place. Broadly, it refers to sharing behaviors or beliefs only because many other people do the same 2.

In the context of creative decisions, we observe this effect happening most frequently when there are a larger number of decision-makers in a room, particularly with a wide range of job seniority (junior team members to top-level execs). When multiple decision-makers voice a preference for a name (especially when they have higher seniority) we see that people are less likely to voice favorability of names that are not spoken about, regardless of whether they are good solutions. Time and time again, we see names being evaluated based on their popularity and not their effectiveness.

Don’t be mistaken, group consensus is never a bad thing, but when it comes at the cost of individual thought and expression, it can hinder the variance of perspectives and therefore limit consideration of certain names. It is simply irrational to evaluate a name based on the number of people that say they “like” a name and not on its potential effectiveness in the marketplace. Naming is not a popularity contest!

Solution: Limit the number of decision makers in the room. In Lexicon’s experience, a surplus of decision-makers on a creative project means efficiency typically decreases. Take the time to select 3 to 5 individuals from your leadership team who are very well versed in your company’s values and goals and who can ultimately drive decision-making. Limiting the number of decision makers in the room allows for less seniority variance and therefore less psychological pressure to speak up (we hope).

Furthermore, if there is a lead decision-maker in the room, they should take note if the entire team likes the same names (and only the same names) as they do. Allow others to speak up and give feedback first to encourage an open dialogue.

Mere Exposure Effect: The mere exposure effect explains our preference for things that are more familiar to us than things that are unfamiliar to us. In other words, we tend to favor things we’ve been exposed to in the past, especially things we’ve had a lot of exposure to, since preference increases as exposure does 3.

We’ve seen this psychological phenomenon at Lexicon where people tend to initially prefer names that are familiar to them, providing them with a sense of comfort and safety. People often shy away from coined names (names that are made up and therefor highly unfamiliar), while gravitating towards safe, real-word solutions.

This is counterproductive to creative strategy, though, because names that are comfortable, safe, and familiar will not stand out in their respective marketplace. Take TripAction’s recent rebrand to Navan, a coined palindrome, for example. TripActions is a descriptive, comfortable compound solution, while Navan is an exciting coined solution with distinctive sound symbolic properties.

Our CEO David Placek likes to use the phrase “surprisingly familiar” when describing Lexicon’s unique approach to naming. In this sense, we take familiar concepts, satiating the mere exposure cognitive bias that craves familiarity, and apply them to unexpected contexts. A perfect example of this is Lexicon’s credential Blackberry.

Solution: Get out of your comfort zone – embrace unfamiliarity. Don’t evaluate options based on how familiar they are to you. If a name feels uncomfortable, good! That is a sign that it will stand out in the marketplace.

Conformity is the last refuge of the unimaginative
Oscar Wilde

Anchoring Bias: The anchoring bias is an interesting phenomenon whereby we rely too heavily on the first piece of information we receive on a subject 4. This initial exposure then becomes our reference point (anchor) moving forward, influencing our subsequent judgements and decisions 5.

How does it play out? Take this scenario. The Lexicon team finishes presenting names to a group of decision-makers, and when asked for feedback, one of the decision-makers instantly blurts out, “This name reminds me of…[insert something irrelevant and unappealing].” Now, despite the name potentially being a great solution, other decision-makers are going to judge that name based on the negative or unappealing association whether they initially liked it or not.

While it is seemingly unreasonable to ask people not to have inherent associations with a name (all words, even coined solutions, hold some level of intrinsic values through associations and sound symbolic properties), it is irrational to judge the overall effectiveness of a name based on one decision maker’s irrelevant association. Remember, this person’s association is personal and holds no relevance once the name is in the marketplace.

Solution: Try not to let what others say sway your opinion on a name. Make your own judgements of names based on how you feel about their potential effectiveness in the marketplace. Avoid ruling out names based on irrational associations. You are deciding which names are most effective vessels to carry your brand’s story into the marketplace, not which names remind you the least of Uncle Tony.

It is also advantageous to adopt different methods to analyze names. For example, try dedicating solo time for team members to analyze names on their own. To make team members feel more comfortable about sharing their opinions, you could also try anonymizing feedback on the names.

We can’t control luck. But we can control the way we make choices.
CHIP HEATH, DECISIVE: HOW TO MAKE BETTER CHOICES IN LIFE AND WORK

1 ”Why do we focus on one characteristic to compare when choosing between alternatives?” The Decision Lab, https://thedecisionlab.com/biases/take-the-best-heuristic

2 “Why do we support opinions as they become more popular?” The Decision Lab, https://thedecisionlab.com/biases/bandwagon-effect

3 “Why do we prefer things that we are familiar with?” The Decision Lab, https://thedecisionlab.com/biases/mere-exposure-effect

4 “Why we tend to rely heavily upon the first piece of information we receive?” The Decision Lab, https://thedecisionlab.com/biases/anchoring-bias

5 “Anchoring (heuristic)” BehavioralEconomics.com, https://www.behavioraleconomics.com/resources/mini-encyclopedia-of-be/anchoring-heuristic/