Monday, September 21, 2015

Loosen Strict Categories

When a shopper feels happy, two things happen that lead to them buying more than they would otherwise. First, because they’re enjoying the positive feelings, they are more willing to persevere. They’ll stay with you, the salesperson, for a more extended selling pitch—as long as they feel you’re bringing them closer to satisfying their needs and wants.
     Second, happiness opens up the shopper to new ideas, and that means they’re more receptive to considering products they haven’t tried before. If you want to change brand preferences or introduce the shopper to an innovative service your store or website offers, begin by developing a positive mood and then present the new idea.
     Happy shoppers are also more receptive to looser flexibility in categorizing expenditures. It has to do with what economists call “fungibility” and the rest of us would call “substitutability.” A dollar spent on one item might have brought equal pleasure being spent on another item. At the extreme, this means the person maintains one overall budget for expenditures instead of placing expenditures into strict categories.
     Researchers at Fordham University and Vanderbilt University find that consumers who perceive themselves as busy and are feeling happy are comfortable taking from one category to put into another. They’d justify using some of the their budget allocated to home maintenance to spend on a vacation or the other way around.
     Research at University of Chicago finds that when shoppers compartmentalize their expenditures, they become more like tightwads. They end up consuming less than they wish they had. This is especially true if an expenditure is unexpected and large.
     Stimulate pleasant moods with shoppers who compartmentalize expenditures excessively. Researchers at Yale University, Arizona State University, and Singapore Management University saw little use in saying to tightwads, “By getting a good deal on this item, you’ll have more money available to buy other items.” It’s not that the tightwads aren’t influenced by this reasoning. Rather, it’s that they’ve almost surely thought of it already. They’d consider a salesperson telling them this to be a waste of time.
     Instead, catch things at the point where the customer is deciding into what category to place the expenditure. Encourage the customer to assign it to a category called “exceptional purchases.” The meaning of “exceptional” here could be understood as “unusual,” but the word works better because it also implies “superiority.” It keeps the shopper’s spirits positive.

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

Click below for more: 
Profit from Shoppers’ Positive Moods
Add Shopper Fun with Fungibility

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