Servicemember Roth TSP Re-Enrollment
What was the challenge?
Because of a change in the military pay system, 139,273 active duty members of the Armed Forces needed to re-enroll in their Roth Thrift Savings Plans (TSP) in January 2015 to avoid having their contributions suspended indefinitely. To re-enroll, Servicemembers needed to log in to the Department of Defense’s (DOD) MyPay website and select a contribution percentage.
What was the insight?
These Servicemembers had previously enrolled in Roth TSP accounts, and so DOD and SBST worked together to redesign the email encouraging actions to make the actions as simple and easy to follow as possible. The redesigned outreach email emphasized the New Year as a fresh start, laid out the three steps needed to complete the re-enrollment process, and encouraged action in order to avoid losing the chance to contribute savings.
What was the pilot?
The 139,273 Servicemembers who needed to re-enroll were assigned to two groups based on the last two digits of their Social Security Number (SSN), with those with SSNs ending in 0–49 (n = 69,318) sent the standard email, and Servicemembers with SSNs ending in 50–99 (n = 69,955) sent the redesigned email. After sending the emails on January 2, 2015, DFAS tracked re-enrollment requests.
Standard email sent to participants
Redesigned email sent to participants
The redesigned email shows how SBST incorporated specific behavioral insights into the adapted message.
Citations are below.
What was the impact?
One week after the emails were sent, 16,291 Servicemembers who were sent the standard email (23.5 percent) had re-enrolled, compared with 20,061 Servicemembers who were sent the redesigned email (28.7 percent). This means that 22 percent more Servicemembers—3,770—re-enrolled in their Roth TSP, or at least accelerated their re-enrollment, as a result of being sent the redesigned email instead of the standard email. Because the redesigned email was more effective at prompting re-enrollment after one week, a modified version of the more effective message was subsequently scaled to the entire population in follow-up messages that encouraged Servicemembers to act before the deadline. Thus, in addition to demonstrating the relative impact of using behavioral messaging to drive action, this project also illustrates the rapid scalability of insights identified as effective via this type of administrative experiment.
- Loss Aversion: Kahneman, Daniel and Amos Tversky. “Prospect Theory: An Analysis of Decision under Risk.” Econometrica, 47.2 (1979): 263-291; Ganzach, Yoav, and Nili Karsahi. “Message framing and buying behavior: A field experiment.” Journal of Business Research 32.1 (1995): 11-17.
- Personalization: Dijkstra, Arie. 2005. “Working Mechanisms of Computer-Tailored Health Education: Evidence from Smoking Cessation.” Health Education Research 20:527-539.
- Fresh Start: Dai, Hengchen, Katherine L. Milkman, and Jason Riis. “The fresh start effect: Temporal landmarks motivate aspirational behavior.” Management Science 60.10 (2014): 2563-2582.
- Action Steps: Allen, Heidi, Bill J. Wright, and Katherine Baicker. “New Medicaid enrollees in Oregon report health care successes and challenges.” Health Affairs 33.2 (2014): 292-299.
- Plain Language: Bower, Amanda B., and Valerie A. Taylor. “Increasing Intention to Comply with Pharmaceutical Product Instructions: An Exploratory Study Investigating the Rolesof Frame and Plain Language.” Journal of health communication 8.2 (2003): 145-156.
- Postscript (PS): Vögele, Siegfried. Handbook of direct mail: the dialogue method of direct written sales communication. Prentice Hall, 1992.