Monday, December 5, 2016

Advance Consumer Benefits with Advance Ordering

The same person purchases differently when expecting future consumption rather than immediate consumption. Usually, the introduction of delivery delays results in higher quality choices.
     University of Pennsylvania and Carnegie Mellon University researchers compared the calorie counts of meals ordered by students either before or after class, with the meal to be delivered right after class. Meals ordered before class averaged lower calories counts—especially when it came to desserts and beverages—than those meals ordered after class. Satisfaction with the ordered meal was similar for the two groups, so the upshot is that advance ordering resulted in healthier behavior.
     The delays in these studies varied between 30 minutes and three hours. When we move toward longer delays and move beyond edibles, we see additional evidence of longer-term benefits for the consumer when using advance ordering. Customers shopping for a product or service targeted for future consumption pay special attention to the distinctive features. But when they plan to put the item to work promptly, they're especially interested in ease of use. Researchers at University of Illinois and Korea University Business School explain that when, for instance, people are looking at software they'll start using in a few months, they give great weight to the range of capabilities of the software. However, if they plan to start using the software within a few days, their primary criterion is ease of learning the software.
     About one month prior to the graduation ceremony at a college, researchers at Columbia University and Singapore Management University described to groups of juniors and seniors at the college two sorts of apartments, then asked each of the students to say which apartment they’d prefer if actually renting it upon graduation.
  • A small apartment attractively decorated, with pretty views out the windows 
  • A large apartment located close to activities the graduate enjoys 
     The college seniors were more likely to select the first alternative than were the college juniors, whose graduation was further in the future. The researchers suspected this is because decisions on purchases consumers plan to use soon are based on emotional assessments. On the other hand, the research evidence suggested, if the consumers won’t be using the purchase for some time, they’ll place more importance on an objective, non-emotional assessment.
     Encouraging advance orders helps your store meet demand smoothly. It also smooths the way for your customers to achieve greater benefits in the long run.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Thursday, December 1, 2016

Shower Cold on Regretful Customers

“Throwing cold water on an idea” means to discourage its pursuit. “Taking a cold shower” is traditional advice for easing passions. And according to researchers at Washington State University, Ryerson University, and Canada’s Western University, a retailer offering cold temperatures to customers reduces any regrets the customers might have about purchases they recently made.
     When people experience regret—thinking more about what they might have done than what they actually did—they perceive their bodies becoming somewhat warmer. It’s related to the blushing we experience when embarrassed, ashamed, or just self-conscious. The consequence is an increased desire for merchandise and experiences which will cool us down. The researchers suggest that when offering for sale items or adventures which carry a risk a purchaser might later regret taking, turn down the store thermostat.
     Please note all this is true for “action regret,” a consumer reacting to actions they’ve taken, but not necessarily for “inaction regret,” a consumer thinking about missed opportunities because of a failure to take action. Inaction regret usually leads to wistfulness instead of guilt.
     Also note that there are times we’ll want to warm up the shoppers. Whenever shoppers experience rejection or loneliness, they’re ready to buy physical warmth. They feel cooler than do people who aren’t lonely. Studies at Purdue University, Tilburg University, VU University, and University of Milano-Bicocca indicate this is because lonely people are, in fact, physically colder. Experimental subjects who were rejected as suitable partners in a game showed reduced body temperatures, and lonely people reported feeling more comfortable when asked to hold a cup of warm tea or coffee.
     Researchers at NUS Business School in Singapore and University of Florida-Gainesville postulate all this is due to lonely consumers being mammals. From when mammals are very young, any sign of negative emotions produces a desire to be held close to get warmed up.
     Bear hugs from staff probably won’t work. Cranking up the heater could burn through your profitability. There would be the fuel cost plus the risk of chasing off shoppers who aren’t feeling cold at all. The way around this is to recognize that the research shows psychological warmth in a store also attracts lonely consumers.
     So to keep lonely shoppers receptive to purchasing more, keep them nicely warmed up. But to help all your customers close out doubts about their purchases and move on, consider offering them a cold beer.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Monday, November 28, 2016

Space Out Large Assortment Displays

When a store display includes a large number of alternatives for the shopper to consider, items in a different category displayed just adjacent are less likely to be carefully considered for purchase. The University of California-San Diego, London Business School, and Bocconi University scientists who verified this say it happens because of shoppers’ limited attention. Selecting from among a large assortment consumes mental energy, and the customer who does choose will want a brief break for the brain afterwards. Using eye-tracking cameras, the scientists saw how customers look away from adjacent merchandise after picking an item from among many suitable alternatives.
     Arrange merchandise in your store so that product categories containing many different stock keeping units are buffered from each other. The buffer could be time. Items which are often purchased together, such as spaghetti and sauce or flashlights and batteries, are each stocked in different parts of the store. An advantage of this is how the shopper will cover more ground during the shopping trip, hopefully spotting more items to buy. However, the need to bounce all around your store could aggravate customers, particularly those in a hurry. Another way to maintain a buffer between large-alternative categories is with thick borders on shelves and empty areas on racks.
     Even the physical barrier method can be challenging when the available display space is constrained, such as on endcaps, in a freezer case, or at the checkout area. If you find it otherwise advantageous to have a large-assortment category display adjacent to another merchandise category in these settings, shelve categories appealing to different consumer target markets.
     Some years ago, researchers at University of Pennsylvania and Columbia University found that large product assortments attract shoppers to a store, but once there, many of the shoppers avoid making a purchase because they’re not sure what’s best. Because of indecision, they might leave the store.
     Then studies at Yale University, University of New South Wales, and Peking University indicated you can avoid this problem by encouraging the shopper to think in more abstract ways, such as about features the items have in common rather than considering each item in the choice as unique. Similarly, researchers at University of Delaware and University of Pennsylvania discovered that a way to keep shoppers engaged is to encourage them to focus on product features rather than item alternatives. With features in mind, shoppers rate alternatives until deciding.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Thursday, November 24, 2016

Lighten Up When Health Outweighs Taste

With food products, the color of packaging influences the opinion of what’s contained inside. Packages you carry on your shelves which include green in the label are more likely to be perceived as fresh. Show consumers from throughout the world green product packaging and you'll probably hear descriptions like new, organic, healthy, and refreshing. And pale package colors stimulate perceptions of lower calories with fewer additives, thereby also leading to consumer perceptions of healthfulness.
     But researchers at Kiel University and University of Dresden caution about going beyond the pale. Along with indicating a healthy choice, the lighter colors on a package can lead to expectations of weak flavor. This is more likely to happen when the shopper puts more importance on the taste of the food than on eating healthy.
     It’s also more likely when the shopper has not eaten that particular item before. Once they’ve tried it, the pale color of the package continues to imply healthfulness while the expectations of taste are influenced principally by the shopper’s past experiences having actually sampled the food.
     The tip for retailers: With food items where the appeal is to health, favor alternatives with light packaging colors. If such items don’t come to you from the supplier with light package colors, use pastels for your ads and store signage about the items.
     The shape of the package also plays into the perceptions. When purchasing a product associated with extra calories, there are shoppers who habitually prefer packages having an hourglass shape to those that are short and squat.
     And transparent versus opaque packing makes a difference. Researchers at Ohio State University and University of Texas-Austin found that for foods in large packages, opaque packaging with an illustration of the item resulted in higher sales. For foods with interesting colors or shapes sold in small packages, the likelihood of purchase and amount consumed increased with transparent packaging. However, an exception to this was with any vegetables which consumers thought of more for health benefits than for tastiness. Here, opaque packaging resulted in higher sales than did transparent packaging.
     A tradeoff between perceptions of healthiness and of tastiness is commonly seen with consumer research. In a set of University of Chicago studies, people assigned to eat a “healthy” food rated themselves as hungrier afterwards than did people assigned to eat a “tasty” food, yet all the samples were actually the same food item.

For your profitability: Sell Well: What Really Moves Your Shoppers

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Monday, November 21, 2016

Anticipate Black Friday Syndrome

Shoppers go crazy to varying degrees at Black Friday promotions, limited quantity sales, celebrity appearances, highly publicized releases of state-of-the-art merchandise, and other events which draw crowds to a store. Be ready for regression to more primitive behavior.
     Researchers at University of Nebraska-Lincoln observed adults shopping for fast fashion apparel which was in short supply. What the researchers saw was highly influenced by the shopper’s gender. The men were much more likely than the women to move along urgently, hunting for items that would be suitable, and then quickly retreating to the checkout station with their items in full view. Women were more likely to furtively gather the apparel they wanted, hoarding and even hiding their collected trove—behaviors more likely to lead to shoplifting.
     These gender differences between hunting and gathering resonate with humankind’s earliest history.
     Understand the psychology of crowds as part of preparing for having people fill your aisles at times your stock is in limited quantities:
  • If shoppers will be waiting in line to enter the store or department, have store staff wearing name tags talk to the shoppers. Invite those in line to fill out a sweepstakes form with their name and other identifying information. Because they lose some of their individual identity and therefore their sense of individual responsibility, people in crowds are driven to actions they would not take otherwise. Name-to-name contact can head this off. 
  • Distribute the special items throughout the shopping area. Your objective is to scatter out any crowding. When people are in crowds that they'd prefer to avoid, they get more likely to panic and strike out aggressively. 
     Scarcity does open opportunities for higher profit margins. In a classic consumer psychology study, participants were presented a set of Nabisco chocolate chip cookies and asked to answer questions like:
  • How attractive are the cookies? 
  • How much do you like the cookies? 
  • How much would you be willing to pay for one of these cookies? 
     For some participants, two cookies were presented, while for the others, ten cookies were there. Which group gave higher ratings to the attractiveness, liking, and price willingness? Yes, the group that saw only two cookies.
     Customers accept paying substantially more for items that are scarce, as long as the customers accept that the reason for the scarcity is genuine, such as when a state-of-the-art product is first introduced or with Black Friday deep price discounts.

For your profitability: Sell Well: What Really Moves Your Shoppers

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