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• The design is nice -- its easy to read. Its
  set up nicely, just the whole italic and the bold
  heading and the lines and so on -- its just easy
  to read. Its not confusing. You know you dont
  have to plow through it.

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• Its good if you were going to compare them.
  I mean, you can just put this one next to this
  one, and go yes, yes, no, no. Its very
  symmetrical.

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Effective Disclosure RegimesPractical Approaches

• Jeanne M. Hogarth
• Consumer Community Affairs
• Federal Reserve Board, USA
• The analysis, comments and conclusions set forth
  in this presentation represent the work of the
  authors and do not indicate concurrence of the
  Federal Reserve Board, the Federal Reserve Banks,
  or their staff.

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Goals

• Discuss What makes a disclosure effective?

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Goals

• Share Design project on notices that are easy
  understand and compare

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Not a strong record of success

• Alcohol and tobacco warnings

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Not a strong record of success

• Consumer product warnings

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Not a strong record of success

• Too many products

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What makes a disclosure effective?

• Consumers are exposed to it

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What makes a disclosure effective?

• Consumers are aware of it (pay attention to it)

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What makes a disclosure effective?

• Consumers can comprehend it (understand it)

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What makes a disclosure effective?

• Consumers can remember it when they need it

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What makes a disclosure effective?

• Consumers can use it (act on it) when making a
  decision

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Some dilemmas

• Exposure attention
• Consumers pay attention to novelty
• New!
• Improved!
• Different!

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Some dilemmas

• Learning effects
• consumers are better at comparing when
  information is standardized

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More dilemmas

• Efficacy of encouraging or fearful messages
  depend on what behavioral stage a consumer is in

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More dilemmas

• Efficacy of encouraging or fearful messages
  depend on what behavioral stage a consumer is in

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More dilemmas

• How do we know who is where and what information
  they need?

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Plain language is necessary..

• .. But not sufficient

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More than just plain language

• How do you frame the disclosure whats the
  context?

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More than just plain language

• Is the whole equal to the sum of the parts?
• How do you organize the parts

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More than just plain language
Monthly payment?
APR?
Fees?

• How do consumers process information?
• WIFFM (whats in it for me?)

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Interagency project designing
easy-to-understand consumer financial privacy
notices

• Design notices that are easier for consumers to
  understand and compare

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Our Targets

• Comprehension
• Compliance
• Neutrality
• Comparison

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Blooms Taxonomy
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Research Questions
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Design process

• Plan?
• Design ?
• Assess/Revise? Test ?
• Evaluate

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Consumer testing

• Focus groups
• Formative testing
• Sets of individual interviews

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What we learned

• Context is key to comprehension
• Design elements aid comprehension
• Content revisions improved comprehension
• Consumers were able to compare

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Where do we go from here?

• Usability testing with larger sample
• Final report by end of 2006

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Coming Attraction! Truth in Lending Regulation
Z Open-end credit (credit cards)