Book Review: The Power of Habit

The Power of Habit by Charles Duhigg is all about the psychology of habit formation and change. Why then, you may well ask, am I reviewing it here on a blog about behavioural economics? The answer is nudges. Behavioural economists are often interested in things that will change behaviour, and habits are a big part of behaviour. Three examples in the book...

Firstly, an American army major who wanted to stop regular riots in the small Iraqi city of Kufa. People would slowly gather over the course of a few hours in the central plazas and after a while violence would break out. The major had an idea of how to nudge a crowd into staying peaceful: Stop food vendors entering the plazas. The usual practice was for food sellers to enter the crowd, but by stopping them from doing so the crowd got hungry, and so started to dissipate. There were no riots after the food vendors were stopped from supplying food to angry crowds.

Secondly, McDonald's in their attempts to get people to buy their food out of habit. One of the key insights into habit formation is that each habit has a specific cue. McDonald's realised that they needed to keep the same cues across outlets. Thus each McDonald's looks the same, smells the same and sells exactly the same food. Whatever sparks your habit of buying McDonald's, the same cue will exist at all outlets. Thus your habit is mobile - you don't need to be near your local McDonald's to feed your Big Mac habit.

Thirdly, retailers in their highly successful bid to understand consumers better. Big shops have been collecting data on their customers for decades, but recently they've made a breakthrough: consumer habits (and thus purchasing patterns) change in predictable ways as people face major life events. Retailers realised that if a woman started to buy baby clothes and pregnancy drugs she was likely to be pregnant. Having a baby is a big life event (apparently). Having a baby considerably alters purchasing habits, meaning that marketing at this eventful time is likely to be more successful. The result: shops target (likely) new parents with adverts for products like nappies. They nudge people into buying their products.

My one complaint with The Power of Habit is that not all human behaviour can be called a 'habit'. You cannot explain everything through habits. Having said that, even the non-habits covered by Duhigg are incredibly interesting. In conclusion, I thoroughly recommend The Power of Habit (whether you be an addict or just interested in behavioural economics) but I do not necessarily buy into the book's central argument.

Genre: Psychology
Accessibility: 10/10
Accuracy: 6/10
Readability: 10/10
Usefulness: 8/10
Verdict: A Very Good Read