Sunday, April 3, 2011

Display the Signs of the Times

At a lemonade stand—that fundamental incubation engine for retailing entrepreneurs—browsers were greeted with a sign. For some of the participants in this Stanford University study, the sign read “Spend a little time and enjoy our lemonade.” For another group, the sign read, “Spend a little money and enjoy our lemonade,” and for a third group, simply “Enjoy our lemonade.”
     The researchers were comparing the effectiveness of a sales appeal that centers on spending time with one that centers on spending money. They knew that consumers don’t like to waste either time or money. They also knew that both consumers and retailers consider time to be more perishable than money. Unspent money can be spent on something else later, but unspent time is useless as soon as the calendar turns to the next day.
     Researchers at University of South Carolina found that when consumers spent money to earn a reward, they were equally likely to use the reward in the future as in the present. But when consumers spent time to earn a reward, they were much less likely to use it in the future than in the present.
     What the lemonade stand researchers found is that people who responded to the time appeal expressed more satisfaction than did the customers responding to the money appeal. Parallel findings came…
  • With university students asked to think either about the amount of money they spent on their iPod or the time they spent in purchasing it.
  • With restaurant patrons asked to think either about the amount of money they spend eating out or the amount of time they spend eating out.
  • With automobile owners asked to think either about the amount of money or the amount of time they spend in car care.
     In each case, the consumers who were prompted to think in terms of time would express more satisfaction with their purchases than did the consumers asked to think in terms of money.
     As a general rule, then, remember to talk to customers about expenditures of time: The time they can save in making the purchase from you rather than shopping around more. The quicker learning curve if they purchase the training services you offer.
     But the researchers did find an important exception to the general rule: Status-conscious consumers shopping for status-display items were more interested in spending money than in spending time.

Click below for more:
Motivate Shoppers Using Their Time Benchmarks
Attend to Negatives When High Time Pressure

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