At the Green Dragon beer bar in Portland Oregon, economists from the American Association of Wine Economists (AAWE) wanted to see whether patrons could differentiate three European lagers. Offered no brand cues, participants would just have three glasses placed in front of them to taste. Two glasses would have the same beer (the twins) and the third, a second brand (the singleton). Called the triangle test, the experiment’s design only required participants to decide which beer was different and which two were the same. Czechvar, Heineken and Stella Artois were what they tasted.
Where are we going? To behavioral economics and consumer decision-making.
The Beer Triangle Test
Because of the triangle format, researchers needed three rounds and recruited 138 unpaid tasters.
- Round 1: Beer A in 2 glasses; Beer B in 1 glass
- Round 2: Beer B in 2 glasses; Beer C in 1 glass
- Round 3: Beer C in 2 glasses; Beer A in 1 glass
The tasters were aged 21 to 70, each of whom participated in one round. 61 percent were men. Their goal was to see whether their results reflected chance or taste recognition. One-third was the dividing line. The results would be categorized as reflecting chance if the singleton were identified in less than or equal to one-third of the round’s responses. But more than one-third of all responses meant people recognized a taste difference.
In the graph (below), with the red line dividing chance from taste recognition, you can see that, overall, the drinkers’ answers were no better than if they had been guessing and not even tasting the beer. Specifically, in Rounds 2 and 3, they performed worse than chance and in Round 1, slightly better.
So, what is going on?
Perhaps we choose our beer because of something other than taste.
The Pepsi Paradox
And that takes us to what Scientific American called the Pepsi paradox. Attaching participants to an MRI, scientists at Baylor Medical School watched the brain respond to Coke and Pepsi during a blind tasting and then when people knew what they were drinking. When people did not know which Cola they were drinking, their ventral putamen (part of the brain that relates to feeling good) displayed their pleasure after the Pepsi taste because most of them liked it better. However, told which was which, a different part of the brain with “a higher cognitive process” became active with Coke. Essentially, the message said, you may like Pepsi better but you should prefer Coke.
Our Bottom Line: Behavioral Economics
Psychologist Daniel Kahneman in Thinking Fast and Slow tells us that our decision-making responds to our brain’s System 1 and System 2. System 1 is our fast thinking and System 2 is slow. System 1 involves intuition and the answers we can automatically come up with. We use system 1 to add 2 + 2 and to jump to a conclusion about someone’s mood based on her expression. By contrast, System 2 involves more attention and cognition. It can relate to waiting for a starter gun to sound in a race, to deciding appropriate behavior and to filling out a tax form.
A father of behavioral economics, Dr. Kahneman won the Nobel Economics prize for telling us that people do not always behave rationally when they make economic decisions. Returning to beer and Coke and Pepsi, I wonder if Systems 1 and 2 relate to our brand loyalty.
A System 1 or System 2 impact from this Coca-Cola ad?