Thursday, August 4, 2011

Acknowledge Inertia in Consumer Behavior

I once served on a team tasked with helping the State of California prison system predict how well men being considered for parole would do if released. As in consumer psychology, the challenge is to move beyond describing and understanding human behavior into adequately accurate guesses about what will happen in the future.
     A story I was told while working on the prison project nicely highlights a principle of consumer behavior:
     Sitting before the parole board, the inmate is asked, “What is the first thing you’ll do if we release you to the community?”
     “I’ll build the biggest bomb I can and blow up this place!”
     Based on that answer, the board promptly turns down the man’s bid for parole, telling him, “We’d like you to rethink and revise that decision. In twelve months, we’ll again consider releasing you.”
     Each year, the inmate appears before the board, each time he’s asked, “What is the first thing you’ll do if we release you to the community?,” he answers, “I’ll build the biggest bomb I can and blow up this place!,” and the parole board members recommend he develop a better plan.
     Then one year, the answer is dramatically different. The man says, “When I get out of prison, the first thing I’ll do is to find a job as an accountant, making use of the thorough training I’ve received while incarcerated here. I realize that because of my felony record, it will be a challenge to become a Certified Public Accountant, but I shall persevere. In any case, my research has shown me that there is a demand for talented accountants. My instructors have told me I am especially talented, so I fully expect to be very successful financially.”
     Highly impressed, one of the parole board members asks, “What will you do with all that money?”
     “To begin to compensate for the damage my crimes have inflicted on society, I’ll contribute to a variety of charities. But I’ll always be sure I save enough to support my wife, my children, and my aging parents. I’m confident there will be sufficient funds for all that and more.”
     “And then what?,” asks another board member.
     “I’ll buy the biggest bomb I can and blow up this place.”
     There is substantial inertia in human behavior. Prison inmates, consumers, and retailers change. Still, the best single predictor of future behavior is past behavior.

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

Click below for more:
Change Brand Loyalty Habits Gradually
Change Up How You Do Business
Weigh Flat-Fee Pricing

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