The Ugly Truth About Cognitive Bias

The Ugly Truth About Cognitive Bias

AUTHOR: Kenda Macdonald

As a dedicated consultant, I specialise in elevating businesses through top-tier consultancy, fueled by a deep understanding of buyer psychology cultivated over years of experience. My expertise lies in crafting marketing and sales strategies that propel businesses to new heights by leveraging insights into the buyer brain. As a bestselling author, public speaker, and strategist, my passion for decoding human behavior drives me to innovate and deliver unparalleled results. I've designed a methodology adaptable for all types of businesses, ensuring transformative customer journeys and experiences.

Most marketing conferences will have one or two talks about cognitive bias. Every marketing section in the book store will have a book or two on psychology in marketing. And every marketer loves to know little hacks they can use to get into consumers' brains. 

We’re fascinated by how the brain works! 

That’s completely fair, the brain is utterly mesmerising in its complexity and weirdness. 

And of course, because we’re marketers, we like to use these tricks and tips we learn to do one thing: increase conversion rates.  

Everything we do in demand generation and marketing automation revolves around conversion rates and how effective we are at getting people to that point of purchase. 

And this is where the problem lies when it comes to cognitive bias and its use in marketing. 

There’s an ugly truth about cognitive bias… And I’m going to lay it bare for you. But first, let’s get on the same page with a little pit stop at what cognitive bias actually is...

What cognitive bias is

To understand cognitive bias, we need to understand Dual Process Theory. This theory about how we pay attention, reason and make decisions was really brought into the public eye by Daniel Kahneman and Amos Tversky in their groundbreaking book Thinking Fast and Slow

The basic premise is that we use two systems (or processes) to understand the world around us, and make decisions. 

System 1 is fast, automatic and rule driven. 

System 2 is slow, manual and effortful. 

The real difference between the two systems is that System 1 takes in around 11 million bits of information per second. While System 2 only takes in around 40 bits per second. 

Why the giant discrepancy?

That’s the fun stuff! System 1 takes in so much because it uses rules and mental shortcuts to filter the information. 

System 2 does not. 

What’s worse, is that because of these rules and processes that System 1 uses, it’s super efficient. Low on calorie use. 

But System 2 is intensive, it monches calories away like there’s no tomorrow. 

System 2 is what we use to solve complex problems and do the heavy lifting in terms of problem solving. 

Let’s look at a little example here to show you how both systems are used.

How System 1 & System 2 are used in the ‘real world’:

You’re in the jungle. The birds around you go eerily quiet, you hear a rustle in the bushes…

Suddenly there is a flash of orange! Your survival brain will have picked up on all of this information and filtered it down to “There’s a predator, get out” and given you a rush of adrenaline to help. 

That’s System 1 saving your butt there. 

Had you relied on System 2 to parse that information together and decide what to do, the rather gorgeous - but hungry - tiger would have had you for a tasty snack before you could suss out what’s going on.

We can’t rely on System 2 to survive. 

System 1 is what gets us through our day, making quick decisions, saving calories and being efficient with what it pays attention to and what it does not. 

And the efficiency around calorie use is incredibly important. The brain doesn’t want to use calories. It’s a survival machine - if you use too many calories, you might die! 

Thankfully in modern life this isn’t the case, but our survival machine doesn’t know that and it’s doing its best to keep us alive and rich in calories (Lord knows I’d like mine to store a few less please). 

So what does this mean for marketing? 

Tigers also have System 1 so it seems....

These systems pose a significant problem for marketing

Specifically, two problems:

  • We create marketing for the wrong system
  • The system we need is flawed and biased

Most marketers tend to create marketing for “considered thought”. That is, we treat our prospective customers like clever little sausages that are going to be paying attention. We write our content for people that are going to make a nice, logical decision. 

“Considered thought” is System 2. 

That’s a major problem. 

We only spend around 15% of our day in System 2. To even get to System 2 the brain has to have decided that the information was SO important that it needs to be flagged up for calorie use and being dealt with. The chances of that happening are very slim indeed. 

System 1 is where we need to focus

This is the part of the brain that decides what goes where. It’s the gatekeeper to attention. 

But by creating our marketing for considered thought, we don’t put enough cues in place for the brain to pay attention. 

Our prospects are in System 1 for 85% of the day

If you’re not pandering to System 1, you’re being filtered out.

So what does this all have to do with cognitive bias? 

The efficiencies of System 1 are also our failure.

All these rules and mental shortcuts that allow System 1 to be so effective are made up of Algorithms and Heuristics. 

Algorithms are rules the brain uses that very rarely go wrong. Think swallowing, talking, walking, making tea in the morning etc. 

Heuristics are rules of thumb the brain uses to deal with all the other information that it needs to be a bit more flexible with. 

These go wrong. And that wrongness is often predictable. These errors are cognitive bias. 

Kahneman and Tversky first showed us how bias hugely affects our decision making. They proved how we don’t make lovely logical decisions, but instead are severely impacted by our cognitive biases. 

This breakthrough in moving from thinking of the brain as a logic machine to something that is flawed by its desire for efficiency and low calorie use is what won Kahneman the Nobel Prize in Economics.

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How cognitive bias is used in marketing

The predictable nature of the cognitive biases all humans suffer from, have made them a great resource for pop psychology and marketing. 

For example, the anchoring effect means we tend to benchmark things against the first bit of information we see. Rather than expending additional effort and energy on finding a good baseline to compare from,  we just use the first thing we see to be our arbitrary baseline. 

This is used on sales pages the world over to set up pricing tables that make pricing look more competitive than it actually is. 

Cognitive biases are used on sales pages, websites and in advertising to help increase sales. 

There are some ethical considerations with this (which we’ll dig into in a moment), but this focus on point of sale is flawed in its own way. 

The actual point of purchase is where we have the least amount of influence on consumers. 

By the time someone gets to the point of purchase, their brain has already assigned a reward value to your products and services. You can read more about that here

The reward activation that the brain gets from seeing your products and services is the biggest influence factor. 

The work to increase reward activation is all done in the run up to the sale. That’s the function of your nurture, your email campaigns and everything you do to increase the positioning of your brand while helping your prospects. 

The biases that are flagged as being “conversion rate optimisers” are hacks. They don’t focus on the things that are going to get you customer lifetime value

They won’t make the impact you’re hoping they will. They’re short term tactics. Your work starts much earlier in the funnel. 

Now let’s talk about what this usage in itself is a terrible idea. 

How cognitive bias is misused by marketers

Cognitive biases are errors the brain is making. 

When they were originally introduced, Khaneman and Tversky used them to show that the brain is illogical and makes mistakes. 

Their basis is that they cause us to make incorrect decisions - choices we wouldn’t usually make if we made that decision in perfect conditions.

Ultimately by using cognitive biases in marketing to increase conversions -  we’re manipulating errors in the brain to get people to make a decision they might not want to make. 

It’s coercion. 

Using an imperfect situation to suit our own purposes. 

If that makes you feel uncomfortable, good. It should. That's the ugly truth to cognitive bias.

Marketing needs to start thinking of bias not as a situational advantage, but as what it is: an error in judgement.

While this paints us as marketers in a somewhat bleak light, ultimately we’ve been approaching this from an extremely coercive and manipulative manner. 

We need to take responsibility for that, and ownership over how to use manipulation of judgement error in our marketing tool kits. 

It doesn’t sound so much fun when it’s said like that does it? 

All that being said, us marketers are suffering from our own biases too…

The biases that make us biased to using bias

We have a number of judgement errors that our own little brains are going through that make us more comfortable doing things in a certain way: 

1. The bandwagon effect

This is when we do something purely because other people are doing it. As more people start to believe in something, or do something, other people will “hop on the bandwagon” - regardless of the underlying evidence of effectiveness. 

“Everyone else is doing it.”

It’s a type of informational cascade. When people give off certain informational signals or display behaviours, it cascades through a population - social psychologists like to call this “herd mentality” or “groupthink”. 

Marketing is rife with groupthink - we see someone else do something clever, so we do it too. We see how other businesses are converting and we want to emulate their results. We’re constantly striving for enhancements and improvements, and that in itself isn’t inherently bad. But it does lead to situations in which the cascade of information doesn’t stop us from checking ourselves and ensuring the strategy is right for us or our audience.

It also makes us fall foul of fads and trends that do nothing for our brands and the goals we’re aiming to achieve. Instead it distracts us and holds us back from hitting the very targets we’re so concerned about. 

2. In-group bias

This bias causes us to give preferential treatment to “our” people. It’s bad when sales manipulates people with icky tactics, but when we do it - it’s strategic? 

We are far more forgiving for the faults of our own group than we would be for another. This again leads to a lack of checking, making sure we’re questioning the application of strategies and tactics - and because everyone else is doing it, we feel ok with doing something that may otherwise be questionable. 

3. Information effect

This sneaky little bias makes us look for information that might help us, even when it doesn’t effect actions. We like learning more. 

In fact, an excessive amount of information often leads to poorer decision making

The challenge here is that we go looking for information, even when we don’t need to, and end up hopping on that bandwagon with our in-group. 

That leads to poor choices, poor validation and a whole lot of action that could be far better applied in other areas. 

Bias manipulation and the modern consumer

Setting aside the ethical considerations of manipulating judgement errors and how you might feel about it, we have one thing we can all agree on: 

Consumers don’t want it. 

Modern consumers (that’s anyone consuming a product or service, regardless of B2B, B2C or B2G) are extremely jaded when it comes to companies, marketing or sales.  They don’t trust us - at all

They feel manipulated, like we don’t have their best interests at heart, and like we’re not telling them the truth. 

And they’re right. 

But more importantly, we’re living in the time of the most savvy, information hungry consumer there has ever been.

What an amazing opportunity we have! 

Consumers want good quality, clear information. They want to make the best choice possible. 

We have the best products, and we want conversions and customer lifetime value. 

It’s a match made in heaven.

Our job as marketers is not to manipulate and coerce… It’s to match out products to customer wants and needs. 

We don’t need to manipulate bias to make that happen. In fact cognitive biases are going to be harming that. 

So what do we do instead? How do we match up their expectations with our needs? 

How to make use of cognitive bias in your marketing

Our consumers want to make considered, clever choices. They want to make the best decision possible. 

Unfortunately, the snap judgments their brains will make and the tendency for brains to satisfice and take shortcuts in an effort to save calories , will mean they won’t be able to do this. 

This is our opportunity. 

But being aware of how and when bias and judgement happen, we can show up and help our audiences make the right choices. 

We can help them avoid mistakes in judgement. 

And we get rewarded for it! The brain forms positive associations with your brand and content, increasing the reward activation. We start to impact the most important part of the process - by being good! 

Isn’t that serendipitous? 

But how do we do that?

Luckily for us, biases are predictable. That doesn’t mean going all crazy “I’m going to learn all 300 + biases and how they could affect my marketing materials”... 

But it does mean that we can roughly categorise bias. We know that in four very specific instances, bias will become a particular problem:

1.  When there is too much information 

2.  When there is not enough meaning  

3.  When time is pressured or we need to act fast 

4.  When we need to encode or recall information.

If any four of these are a problem for your audience, or impact them in some way, we know bias will be an issue. They won’t be making the kind of decision they would like to make if circumstances were better. 

Looking at that list, it’s clear that in any given purchase decision  our brains are going to try to help and end up causing a judgement error. They also won’t be happening in complete isolation - they overlap and bundle together.   

So bias is definitely going to be messing about with your carefully crafted marketing, and it’s going to be affecting your conversions.  

What do you do now?

Easy peasy. We prepare for them. 

We *know* they’re going to happen. 

And we know consumers want to make the *best* choice, not the coerced choice. 

So we mitigate bias. We bust them. 

Let’s go a little deeper and take a look at each of the four areas in turn, and what we can do about them.

Cognitive Bias Category 1 - Too Much Information 

When we have a little too much information the brain helps us out! Unfortunately that helpfulness means errors… 

Firstly information is going to get filtered out. Anything the brain doesn’t think is relevant will go in the bin/ not be paid attention to. 

It will pare down information to pick out the most “meaningful” bits. That might not be what’s actually meaningful! Just what it latches onto in that moment or might match what’s already stored in memory. 

The brain loves to notice things that are already primed in memory. If it can confirm its own beliefs so it doesn’t have to store new information - it will. 

It also likes things that are repeated often, those things stick easier than something that’s only been mentioned once or twice - no matter how important that information is. 

We’re also drawn to things that are funny, a bit weird or stick out. These tend to get paid active attention to. 

All of this means that your information could be ignored, filtered out, incorrectly diluted and all round misremembered. 

What to do when you know there’s too much information:

To help make sure the right information sticks you should focus on simplifying things. Make them easy to understand. Keep them clear and concise

Repeat things that are important. The copy writing rule of “Tell them what you’re going to tell them, tell them, then tell them what you’ve told them.” really helps when they’re overwhelmed with information. 

Cognitive Bias Category 2 - Not Enough Meaning

We can’t make decisions in a vacuum. We need meaning and context to help inform us. 

When the brain doesn’t have enough meaning, shortcuts and rules of thumb happen! 

One of the worst things the brain does in this situation is it connects the dots. It will find and create stories in sparse data to help it understand. Those dots shouldn’t be connected, those stories often don’t exist. It’s making meaning for itself. 

This doesn’t just happen with lack of information though, it also happens with lack of familiarity. Brains will generalise and fill in characteristics, stereotyping to help contextualise. 

Even with enough information, without meaning the brain will oversimplify numbers and data to create its own understanding. 

And on its continuing quest for meaning, it will project past experiences and emotions onto future events and situations. 

All of this means the point you may be trying to make can get completely lost. If you’re not explicit, clear and full of context - your message could be completely misinterpreted. 

What to do when there’s not enough meaning:

If your audience is likely to come across a situation in which meaning could be lost - it’s your job to make sure it’s there for them. 

The first order of the day is to provide meaning. Don’t wait for examples to be asked for, provide them. Do whatever you can to give the context they need. 

Also be explicit. Clarity is vital, the brain shouldn’t need to try and discern your meaning - it should be simple to understand. 

Cognitive Bias Category 3 - Need To Act Fast 

Time pressure causes all sorts of little meltdowns in the brain. The pressure forces us to use System 1 to make quick judgements, and the need for speed means we enjoy lots of mistakes! 

When time is of the essence the brain will avoid ambiguity at all costs.

Brains don’t like things that don’t have a clear or certain outcome at the best of times, but add time pressure in and the brain will shy away from anything that is remotely vague. This sometimes means choosing options that aren’t as good, because the path is clear, the next steps are laid out, and they know what they’re getting.

Yes - *even if it isn’t as good* as one that hasn’t been explained well enough.

It will also prefer choices that allow it to stay autonomous and in control, as well as those that don’t go against the status quo. 

Favouring the immediate options is also a preference, we prefer quick wins over longer gains - it’s something that is tangible to us. That tangibility or relatability is something we can quickly contextualise. That’s going to get a yes from the brain - even if the longer term, less tangible option is better. 

Tied to that is the desire to complete things that are already underway, preferring completion over cutting our losses and starting again, even when that’s the sensible thing to do. 

We also become overconfident in our own abilities, overestimating what we can do and achieve. 

What to do when there is time pressure:

When time is an issue the very best thing you can do for your audience is to highlight what’s important. 

Little helpers like fact sheets or boxes with the need to know information are vital. 

Summarise everything. Give them the top level important information. Don’t let the brain choose for them, tell the brain what it needs. 

Cognitive Bias Category 4 - Remembering and Recalling

When it comes to encoding new information (creating new memories) or recalling information that’s already been stored, the brain is a tricky little lump of meat. 

As it stores information it will keep only what’s “useful”. And that of course is up to it to decide. Because it’s focusing on saving space, it will chunk things up - picking out a few titbits and discarding the rest. 

It will also transfer skill sets, emotions and experience from a past experience onto a new one rather than resaving the information. This means the old information gets stronger, and the new information can be lost. 

And my favourite baddy - it will conflate. It takes two or more things, often unrelated, and smooshes them together. 

This wreaks havoc for forming new habits, learning new skills or deciding what’s important when you’re recalling information. 

What to do when information needs to be remembered or recalled: 

If you need your audience to remember something, keep it simple

Don’t overwhelm them, tell them what they need to remember - don’t make them hunt it out.

Also show them the big picture, give them context and meaning so that related things get stored together in a useful way. 

What can you do with this information?

So, with all this information at your fingertips. What do you do now?  

Remember the ugly truth is: biases are errors in judgement. Manipulating them isn’t something your consumers want, and isn’t something you should be doing. 

Help them make better decisions. You’ll benefit from the higher reward activation in the brain, and they’ll be happier with their choices. 

Provide context wherever you can. The brain needs meaning. 

Now, if you want a handy dandy little summary of all of this, with some ideas for 20 types of content/ marketing improvements you can make, I bundled things together into a little bias buster for you, you can get yourself a copy here:

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Psst. Did reading about Cognitive Bias get your brain cells tingling? Well, this is just the tip of the iceberg! I'm currently working on my new book and it's all about cognitive bias and how it affects marketing... 

If you would like to be added to the waitlist and be among the very first to know when it's available to buy, pop your details in here. We'll keep you in the loop 🙂