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Customizing Consumer Choice in Financial Services


NEWS FLASH: Consumers are not rational. They will not always choose credit union services, even if they should. Neither will they search out good information, evaluate their options and then select the best choice. So should we throw up our hands? No. Dartmouth’s Punam Keller explains.

Professor Keller, a management expert in choice and communication at Dartmouth’s Tuck School of Business, argued a point that seems counterintuitive to 200 Filene supporters at our annual Chairman’s Breakfast: More choices do not help us make better decisions. In fact, too many choices kind of drive us crazy.

I’ll let the attached slides from Professor Keller’s presentation do most of the talking, but here are the key takeaways:

  • Consumers take mental shortcuts. They don’t want to mull many things, so help them make quick decisions.
  • ‘Enhanced Active Choice’ is a cleaver for the cognitive clutter. Simple opt-in options don’t garner great response, and opt-out options don’t offer true freedom. But enhanced active choice gives everyone two choices, with in-text promotion of the advantages of the better option. Everyone still gets a choice, but they don’t have to muddle through the boilerplate they don’t ever read anyway.
  • Not everyone wants everything. Some people want to choose, others want you to choose for them, and others want to defer choice. Credit Unions need to tailor their choice structure and communications to reflect member choice preferences.

That enhanced choice is simple to convey. Rather than another ennervating request to:

  • Sign up for a free credit consultation with your credit union

Why not give the options (and the reasons) right there in the form:

  • I choose to pass on a free five-minute money saving consultation
  • I choose to to speak with a credit union loan officer about how I can put more than $100 per month in my pocket with a hassle-free loan refinance.

Deepak Chopra said it best (as usual): People will suffer almost anything as long as it means they don’t have to change.

Also, catch a great summary of the event from’s Alix Patterson HERE.