System 1 vs System 2 Decision Making

System 1 vs System 2

What Are System 1 and System 2?

System 1 and System 2 are two distinct modes of decision making:

  • System 1 is an automatic, fast and often unconscious way of thinking. It is autonomous and efficient, requiring little energy or attention, but is prone to biases and systematic errors.
  • System 2 is an effortful, slow and controlled way of thinking. It requires energy and can’t work without attention but, once engaged, it has the ability to filter the instincts of System 1.

Examples of System 2

How would you decide which college to attend, which house to buy, or whether to change careers? These are the types of decisions that engage System 2. They require attention and slow, effortful, considered responses. You would naturally have gut feelings about each college, house or career path, but would likely try to supplement them with a much more thoughtful and rational approach: collecting as much information about each option as possible, asking your friends, family or colleagues for advice, or making a list of pros and cons for each option.

Examples of System 1

Now, how would you decide which seat to take in a waiting room, which pasta sauce to buy, or whether to change lipstick colors? While writing a detailed list of pros and cons may be an appropriate approach for choosing a college or career path (in line with System 2), applying this approach to the hundreds of tiny decisions we make every day would prevent us from ever taking action. This is where System 1 comes in.

System 1 is capable of making quick decisions, based on very little information. Maybe the man sitting in the corner reminds you of your high school math teacher… maybe your eye is instinctively drawn to the dark red label on the pasta sauce… maybe your barista was wearing a flattering new shade of lipstick this morning? These fleeting impressions, and the many other shortcuts you’ve developed throughout your life, are combined to enable System 1 to make these decisions quickly, without deliberation and conscious effort.

Kahneman’s Thinking Fast & Slow

book fast and slowThough the System 1 and System 2 discussion has been around for quite some time (a few decades in fact), it was brought into the forefront of national discussion by way of Professor Daniel Kahneman’s landmark book Thinking Fast & Slow. This book dives into the system 1 vs system 2 debate, within the framework of human decision making, and how people can make decisions based on logic, emotion, and instincts. Other ideas & theories touched on by Kahneman in the book include: Prospect Theory, Availability Heuristic, Optimistic Bias, Planning Fallacy, and much more.

Thinking Fast & Slow won numerous awards and honors, including the National Academy of Sciences Best Book Award in 2012, New York Times Book Review award in 2011, and one of the Economist’s 2011 Books of the Year.

How Do They Apply to Market Research?

After understanding the System 1 vs System 2 relationship, one must apply each of these toward market research, and decide which system better suits their data needs.

Psychology researchers have found that the more complex a task is, the more likely people are to engage in System 2 decision making. One interesting experiment, performed by Alter et al., found that simply decreasing the legibility of the font used in a common cognitive test made people more likely to switch to System 2.

Market researchers should keep in mind that the more complex the research collection process becomes (more question types, complex answer matrices, thought experiments etc.), the more likely they are to collect responses generated by System 2. Since most of the System 1 decision making process is unconscious, respondents are more likely to offer what they consider to be plausible rationalizations for their decisions rather than their true underlying attitudes and motivations. In situations where there is social pressure to respond in a particular way, System 2 may even filter these rationalizations to create “appropriate” responses.

System 1 for Brand Awareness

If you are looking to collect data on brand awareness and loyalty, the recommended route would be with System 1. Why? Because brand awareness data is only as good as actual brand purchases. For example, if market research data indicates that a specific brand logo compels users to want to purchase an item with said logo on it, then this data is only accurate if people actually go ahead and purchase this item. And if they don’t, the data is inaccurate. Enter System 1. Because the decision a buyer makes on whether to purchase a particular brand is likely conjured up instantaneously, in an instinctive thought process, the only accurate way to measure and ultimately capture this instinctive nature is through System 1.

Capturing a prospective buyer’s System 1 beliefs can be tricky, as any survey or test that targets a user’s beliefs will likely cause them to ponder their answers for just a bit, thereby straying into the less-than-ideal System 2 territory (for smaller decisions).

System 1 Testing Techniques

How then, is one supposed to test for System 1 answers if any survey, test, or focus group inherently taps into System 2? The key is to utilize a system which does not use a survey or test in any format. One solution is to utilize a game in order to circumvent the whole testing process. A game serves as the perfect platform for engaging users, capturing their unabashed feelings toward brands, logos, and words, and avoids any risk of a user stopping to think carefully about his/her feelings and attitudes and then straying into System 2 territory. Whether it’s because they are distracting, discreet, or simply fun – games have become an effective and powerful tool for System 1 testing, and are being used by innovative market research companies in order to provide superior brand data. Upfront Analytics uses games for market research for this very purpose.

System 2 Testing Techniques

Despite System 1’s superiority for small scale decision making, System 2 still has its place in the market research arena. Traditional market research still employs surveys, landline interviews, and focus groups. These primary research methods can be effective toward collecting accurate data for larger decision making such as buying a house or car.

Advice for Researchers:

Ask yourself how much time and conscious effort respondents have dedicated to the attitudes, intentions or behaviors you’d like to research. If you want to find out why respondents chose one pasta sauce or lipstick color over another, be aware that these decisions were likely made by System 1, without any conscious deliberation from System 2. If you want to find out why respondents chose one car model or pension plan over another, be aware that the instinctive responses of System 1 were likely tempered by the more conscious, controlled processes of System 2.