Nudge or Sludge? Who Your Default Is Working For

Your Cancel Button Is Doing Your Marketing.

March 1, 2025, I sold my commercial space. I had mixed feelings: I was happy about the price, the stress relief, and the prospects for the future; I was sad to let go of the office that shared so many memories.

I was unpacking boxes, disconnecting services, and, in the process, canceling the insurance. I emailed my insurance company along with a copy of the bill of sale, reflecting the new owners' names as of March 1, and asked them to cancel my insurance immediately.

They responded with a request for a certified letter? "Huh," I thought. What is more proof than the bill of sale? A letter that I would have to send through Canada Post, which coincidentally seems to strike every few months.

It had to be done, but it made me reconsider using this same company for my auto and home insurance, if they were going to make it easy to join and hard to quit, like the gym, I didn't really want to endorse them by renewing my other services, so I canceled all of my policies and found a new provider.

There's a name for this. Sludge.

What is Sludge vs Nudge?

Richard Thaler introduced us to Nudge: the idea of making something easier to do, and thereafter Sludge: the process of making things harder. He believes that joining and leaving should have the same amount of tension or effort, not more on one side.

Sludge feels like the embarrassment of quitting the gym, the pain of canceling the magazine subscription, or, in my case, the insurance.

I am not anti-sludge.

I am not against sludge, I appreciate the secondary caution when I accidentally his delete and a pop up askes 'did you mean to delete this?' and I can say no.

Some camps think Nudges are manipulation; I think it comes down to intent.

You can't opt out of choice architecture. Every website has an order. Every pricing page has a first number. Every form has a default. Someone decided those things, even if that someone was a template. Pretending you aren't nudging just means you're nudging badly. Nudging is built in without trying so isn't it just design sometimes?

With sludge, I believe the intent is part of the manipulation at times and a helpful precaution in others, again, it's down to intent.

Why businesses should care.

I always think sludge is a tactic used by struggling businesses, not something those that thrive do. It's a strategy to reduce churn (as you would guess from the gym). It's not something that is forgotten, it's often also nothing that is kept quiet, which tends to cost the business much more in the long run.

When Harris Poll asked 1,000 UK adults about cancelling subscriptions, 80% said a difficult cancellation would make them see the brand more negatively. Just over half said they'd be unlikely to come back. And 89% already believe signing up is easier than leaving. People notice.

Businesses often forget that word of mouth is the strongest advertising (in either direction), and growth often comes from compounding trust, referrals, and repeat business.

Finally how do customers feel about nudges?:

United States (Sunstein, national survey, 2015)

• 80% approved of being automatically enrolled in a retirement savings plan.

• 74% approved of mandatory graphic warnings on cigarette packs.

• 73% disapproved of a default that sends $50 of their tax refund to the Red Cross unless they opt out.

Canada (Sunstein, Reisch & Rauber, survey of 1,000 Canadians, late 2016)

• Canada emerged as a “principled pro-nudge” country: strong majorities support nudges that fit people’s interests and values.

• Canadians were more likely than in most other countries to disapprove of the default charitable donation.

• The paper reports Canada’s per-nudge percentages only in charts, so I don’t have an exact number to quote.

Canada, from the business side. In 2024, the Office of the Privacy Commissioner of Canada coordinated a global review of more than 1,000 websites and apps, 145 of them in Canada. It found at least one deceptive design pattern on nearly every one (Dentons summary). It says nothing about how people feel, but it makes a good “this is everywhere” line.

What's the worst sludge you have experienced? Share your experience, I would love to hear your thoughts.