Thursday, March 31, 2016

Improve Sales Using Guilty Self-Improvement

Suppose that as people enter your store, they pass a table in the front where I offer them a cup of herbal tea to enjoy prior to their browsing around. They’ve only two choices, though: The Get Smart blend is described as improving brain power. The Get Happy blend is said to keep the blues away.
     Are there shopper characteristics influencing who chooses which blend? Researchers at University of British Columbia documented a chief characteristic—guilt. People experiencing guilt selected the Get Smart blend more often than did people not experiencing guilt. Your shoppers who believe they’ve failed to meet standards they’ve set for themselves subsequently become more open to purchasing products and services described as designed for self-improvement.
     Possible sources of shopper guilt are many. Those you might encounter as a retailer include, for example, a customer being late for an appointment with you or succumbing to temptation to make a purchase previously resisted. The self-improvement items you could offer also range widely. The British Columbia researchers list signing up to learn a new language, joining a gym, reading a challenging book, and agreeing to meet with a financial planner. But any retail business could describe items to consumers in ways that allow for penance via effort.
     Moreover, a perfectly good sales pitch for a pleasure-oriented item can be made even better by adding guilt, according to studies at Northwestern University, Pennsylvania State University, and Yale University. The researchers are talking about guilty pleasures—the added kick in enjoyment coming from the consumer saying, “I really shouldn’t be doing this, but it feels oh so good.”
     Psychologists generally classify guilt as a negative emotion and consider that a negative emotion, like sadness, can potentiate a positive emotion, like enjoyment, only through contrast: “This massage feels especially wonderful because I’ve been down in the dumps all week.”
     Guilt is a different kind of catalyst, the research concludes. Where it might make little sense for a retailer to induce sadness in the shopper in order to increase enjoyment, inducing a little guilt can work out fine: “Go ahead and do it. You can’t always be perfect.” This isn’t saying, “Go ahead and do it. You’ve plenty of time to feel guilty afterwards.” This is a matter of arousing guilt during the consumption.
     Whether a shopper comes to you guilty or you induce a bit of guilt, the emotion can sell.

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

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Monday, March 28, 2016

Split Perfectionists’ Dichotomous Thinking

Among the more challenging shoppers for a retailer to please are the perfectionists. Research at University of Central Florida indicates this is true because these consumers habitually engage in dichotomous thinking: An item being considered for purchase is either highly acceptable or highly unacceptable. There is no in-between. Yet for most of us, including the salespeople wanting to sell to the perfectionist, items we like are seen to contain mostly good characteristics—not completely good characteristics—and things we dislike are seen to contain a mix of bad, neutral, and good characteristics. There’s more room for negotiation.
     The retail marketplace itself can encourage perfectionism. The growing abundance of choices tempts shoppers to believe they can have it all. But Michigan State University psychologists say there’s also a large genetic component. It’s often what you’re born with. This means perfectionism resists change.
     It can be done, however, at least for the duration of the consumer’s time in your store:
  • Start by determining if this shopper is, in fact, a true perfectionist. Is the shopper spiraling in toward a defined goal, even though that purchase goal is unattainable? A yes answer indicates you’re dealing with a perfectionist. But if the demands change willy-nilly, and no matter what you do, you can’t move even a smidgen toward a sale, terminate the harassment. 
  • Identify areas important to the shopper for which you can satisfy their specifications completely or very close to completely. When other areas of concern keep coming up, evaluate how vital these would be for a non-perfectionist to receive full value from the transaction with you. Then say how close you can come to what the perfectionist is asking you and bring the discussion back to the areas where you can indeed give perfection. 
  • The Central Florida researchers found that the perfectionist’s dichotomous thinking is at its worst when the shopping decisions are difficult. Therefore, work to simplify the decisions for the perfectionist. Limit options. State item specifications and answer questions succinctly. 
     Along with this, honor a shopper’s respect for high standards. Some time back, actor Peter O’Toole revealed on “Late Show with David Letterman” how the dry cleaner shop he uses inspired his choice of an epitaph. A leather jacket he sent to the cleaners came back with a note attached: “It distresses us to return work which is not perfect.”
     “I’m having that on my tombstone,” Mr. O’Toole announced.

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

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Thursday, March 24, 2016

Finger Out Those Eyeballs, Retailers

Watching the ways in which your shoppers move their eyes gives you clues toward figuring out what interests those shoppers. Researchers at University of Minnesota and Chinese University of Hong Kong find this extends to what your shoppers will be interested in later in their shopping trip. Eyeball movement patterns persist. If a consumer tends to look toward the left or look upwards early in the shopping trip, it becomes more likely they’ll be gazing in that same direction later in the trip.
     Further still, the researchers found that finger movements often go in tandem with eyeball movements. The shopper who reaches toward the right when picking up the initial items tends to gaze rightwards when evaluating the rest of the items on the shopping list.
     Usually, people look at and reach for items that favorably impress them. In fact, the cause-and-effect goes in both directions. In the Minnesota/Hong Kong studies, when shoppers looked at items if only because of the carryover movement habit, the shoppers came to rate those items more favorably.
     Put together, these research conclusions emphasize the value of observing shoppers. However, in using the findings, avoid two traps: First, the observation should be subtle or it will spook the shopper. Second, be aware that the interest shown in an item as evidenced in eyeball and finger movements is not always a positive interest. Neuropsychological research at Copenhagen Business School and the Danish Research Centre for Magnetic Resonance discovered that shoppers have enhanced perception of disliked items.
     The researchers began by asking a group of consumers to evaluate their preferences for 104 well-known brand names. Next, study participants were individually shown the brand names, one at a time, for brief intervals and asked to state for each, whether what was shown produced “a clear experience” of seeing it, “a vague experience,” or “no experience.”
     Those brand names a consumer had rated most favorably were the most likely to later receive ratings of being seen clearly. They were seen more clearly than those brands the person rated negatively or neutral.
     But there was another finding: Those brands rated negatively were more likely to have been seen clearly than those with a neutral rating.
     When a retailer notices a shopper looking at an item, the retailer might assume the shopper especially likes that item. However, the truth is that the item might have drawn eyeballs because of negative reactions.

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

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Monday, March 21, 2016

Explain Channel Pricing Differences

Are you among the storefront retailers who also have an online sales channel? It’s a smart thing to do, since consumers appreciate options in ways to order merchandise. But do you maintain the same pricing in both channels? When you offer a promotional discount through one, do you offer that same discount through the other?
     Researchers at Katholieke Universiteit Leuven analyzed retail situations in which a promotional discount was offered in one of the channels, but not the other. As common sense predicts, shoppers who were aware of the difference in pricing moved their purchases away from the channel which maintained the regular price and toward the one offering the discount.
     What these research findings did add to our common sense notions was the finding that the cross-channel cannibalization effect was stronger when the discount was online. Internet specials ate away at storefront sales revenues more than storefront specials ate away at internet sales revenues. Also, the effects in both directions were stronger for customers loyal to the retailer.
     So stay aware that internet specials can significantly deprive you of the benefits in loyal customers visiting your store. Benefits such as the opportunities to get to know the customer better, stay up-to-date on their needs, personalize your selling, and appeal to a broad range of sense modalities. One way to meet this challenge is to provide purchasers an incentive for picking up at your store merchandise ordered online.
     Another challenge with different pricing for your online store than for your bricks-and-mortar store is a need to explain why. If you do find yourself in this situation, the way you frame the explanation makes a difference. With a short-term promotional difference, it’s best to describe why the internet price is lower.
     This is the opposite of what you’ll do when a channel pricing difference is a standing policy. In that case, take inspiration from research on another type of differential pricing: Researchers at University of St. Thomas and University of California-Berkeley presented some study participants with a situation where a dry cleaner gives a discount when cleaning a man’s shirt that is not given when cleaning a woman’s blouse. About 70% of the study participants said this was unfair. Only if the cost differential was called a surcharge—not a discount—and a reason was given—“more pleats, ruffles, or sensitive fabric”—did most respondents consider it to be fair.

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

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Thursday, March 17, 2016

Spout Quick Numbers for Desirability

Shoppers who want to eat healthy are too often stymied by the complexity of information on package labels and by what can seem to be conflicting nutritional advice in the media. Research at Boston College and University of Pittsburgh assessed a method to simplify selection: Give each choice a number indicating the degree of healthfulness. For their studies, they chose the proprietary NuVal® Scoring System, in which each integer rating is based on the relevance of the item’s contents to health conditions like diabetes and heart disease.
     Data were gathered from more than 100 grocery stores. The purchase patterns of customers during the six months prior to the introduction of the NuVal scores on the store shelves were compared with the purchase patterns of those same customers for those same items during the six months after introduction of the system.
     The researchers found significant increases in the healthfulness of choices attributable to the numeric nutrition rating. This and other research suggests a set of characteristics to make such a system work well:
  • Range familiarity. The scores given to items were selected from a range of 1 to 100. This allowed shoppers to easily sense the relative value of a score of 63 compared to that of 37, for instance. 
  • Breadth. In the studies, only eight food categories were included. It would be better to have ratings for all or nearly all the food items in the store. 
  • Convenience. Consumers balance healthfulness against price in making purchase decisions. To assist that, place the nutrition ratings on the same shelf tags and signage as the price and in an easy-to-read font style and size. In those places, also highlight any price promotions. The Boston/Pittsburgh researchers found that shoppers exposed to the rating system became less price sensitive and more sensitive to promotional discounts. However, be aware that these effects do seem to fade with time. 
  • Credibility. Be sure the rating system is valid, and then train store staff to answer questions about the system in ways that are easily understood. Brochures or signage explaining the system can be helpful. To maintain trust, be sure all spelling and grammar are flawless. The NuVal Scoring System text describing development of the system includes, “No retailers or manufactures (sic) were involved.” 
     Numeric rating systems with these four characteristics can be helpful with products other than food and with addressing shopper values other than healthfulness.

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

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Monday, March 14, 2016

Gently Slant to Produce Proper Happiness

“As retail professionals, let us transform the epigram ‘Money can’t buy happiness’ into the motto, ‘Whoever said money can’t happiness just didn’t know where to shop.’”
     It is with those words in my book Sell Well that I move toward closing Chapter 1, where I detail the two major types of happiness for retail shoppers—excitement and calmness.
     University of Washington researchers say we can tilt consumers toward one or the other of the two by a diagonal slant on store signage. When text moves upwards as the text is read, it arouses happiness through excitement, and when downwards, happiness through calmness. This is also true with upward and downward angled logos, but the effect is less than with text. In my opinion, the decreased effect is because consumers don’t scan logos in one primary direction as with text.
     The types of benefits statements most compelling to shoppers also relate to upwards and downwards. Features of products you sell can be concrete—such as the average time between repairs—or abstract—such as a general claim of high quality. According to researchers at Erasmus University, Loughborough School of Business and Economics, and Norwegian School of Management, shoppers are relatively more interested in concrete features when gazing down at the merchandise and relatively more interested in abstract claims when peering up.
     I’ll also add that any slant must be gentle, not severe, or people will have so much difficulty making sense of the sign that the directional effect on happiness fades completely. Or worse yet, a severe downward slant can depress a shopper. A substantial history of laboratory experiments and anecdotal evidence shows how consumers subconsciously associate upward movements with positivity—such as high self-esteem—and downward movements with negativity.
     When the downward slant is gentle, though, it can motivate viewers to improve themselves. In studies at University of Wisconsin-Milwaukee, Baruch College, and Copenhagen Business School, people instructed to imagine moving downwards performed better on a set of challenging tasks later than did an equivalent group of participants who had been asked to imagine moving upwards.
     These findings help explain why beauty products are most often sold on the ground floor of department stores. The Wisconsin/Baruch/Copenhagen research conclusions indicate you should stock self-improvement items close to store entrances. If a shopper has to exert an effort to get to the items, they may feel they’ve already moved sufficiently toward greatness.

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

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Thursday, March 10, 2016

Sketch Item Aesthetics If Appreciated

An item’s shape influences how well it sells. Would you prefer mayonnaise in a slender, angular jar or the same contents in a jar with a smooth bulbous shape? The angular jar usually wins out. Mayonnaise buyers like thinking slender more than bulbous.
     Such preferences often operate at a subconscious level. No explanation is necessary, and any time spent explaining would likely be wasted. But researchers at University of Innsbruck find circumstances in which a retailer would find it worthwhile to spend time explaining an item’s shape. The benefit is higher purchase intentions. The circumstances are those in which the shape has aesthetic appeal, the shopper appreciates aesthetics, and the item is unfamiliar to the shopper. In this case, the salesperson’s words and gestures sketching out the item aesthetics boost acceptance.
     Consumer research highlights three components of aesthetics in the retail setting:
  • Symmetry. Shoppers like balance in design, with matching elements on the left and right and on the front and rear. But there also should be a few contrasting asymmetries with ratios which intrigue the shopper. 
  • Unifying themes. The different parts of the item appearance should be seen as fitting together into a group. Shoppers find visual pleasure in the repetition of themes. 
  • Familiarity. The shape should represent to the consumer a familiar story. The familiarity may come about because of a principle of design common in a culture. 
     The Innsbruck research indicates you’ll increase sales of an item by noticing which of your shoppers appreciate aesthetics. Other studies have discovered that you can increase sales of additional merchandise by building in the shopper aesthetic appreciation. People are more likely to buy from your store when they consider the store layout and the merchandise display, not just the items themselves, to exemplify good design.
     Researchers at University of Houston and Boston College explored situations in which a customer concludes there’s an aesthetic mismatch between a purchase and their belongings surrounding it. Here, the customer might consider returning the product, and this return visit can be turned into making a sale. It’s most likely to happen with designer labels, luxury branded items, and unusually designed consumer goods. We’re all familiar with stories of the woman who starts out buying a new pair of shoes, and then decides she has to get a new dress to fit with the shoes, and a new hairdo to fit with the dress, and on and on.

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

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Monday, March 7, 2016

Nourish Evaluation When Multiple Choice

Shoppers decide differently when the choice is which among multiple items to purchase than when deciding whether or not to purchase a particular item. First off, people like choices. When Tulane University researchers showed consumers two DVD players, 32% said they’d buy the first and 34% said they’d buy the other. But with an equivalent group of consumers shown just one of the players, only 10% said they’d buy it.
     Beyond this, in the situation of choosing whether to purchase a particular item, people become especially sensitive to the numbers. Researchers at University of Mississippi and University of Arkansas found this to be true with initiatives aiming to have consumers select healthier foods. In the four studies, participants were asked to judge the nutritional value of either a single item or a few items. Those facing the single item paid more attention to the quantitative information—the numbers describing the calories and contents—than to evaluative information—a retailer’s interpretation of the item’s healthfulness. But the participants asked to judge a few items paid more attention to the retailer’s evaluative information than to a comparison of the numbers. More importantly, evaluative information carried more punch than the raw numbers in determining how likely a shopper was to buy the healthier item from among a set.
     As you’d expect, both the phrasing you use in the evaluations and the attitudes of the shoppers play into this. University of Alberta and University of Wisconsin-Madison researchers looked into the effects of what’s been labeled with the attention-getting phrase “fat tax.” The warning tag used in the research read, “This product is high in fat. It has been taxed due to its less healthy nutritional content. Health Canada.” The study participants were not told until the end of the study that the label was fictitious.
     The additional cost made some people significantly less likely to buy. However, they also become less likely to buy other products. Their irritation about the fat tax led to them boycotting. They may be healthier for it, but you’re losing sales.
     Other consumers were willing to pay even more than they would for a fat-taxed product if that higher-priced product didn’t carry the warning label.
     Still others didn’t fall into either of these two groups. However, cycling us back to where we began, for all the study participants, feeling they had choices led to them selecting healthier options.

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

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Thursday, March 3, 2016

Profit from Status with Loyal Customers

The opportunity to show off their status is an influential motivator for retail customers. Even when showing it off only to themselves. People do this to assure themselves of their enhanced position, rising above other customers.
     Researchers at University of San Diego explored circumstances in which a loyalty program granted special status privileges, but the recipient had to incur costs to use those privileges and was not conspicuously showing off the privileges to others. The researchers found that customers in these circumstances still took advantage of the privileges.
     The lessons for retailers: Design loyalty programs to reward customers with status in ways which require the customers to spend money with you. Private sales for these special customers are one example of this profitability tactic.
     Still, please note that there was an important exception to the overall University of San Diego finding: Customers who felt highly secure in their elevated positions were no longer motivated by status-reinforcing actions that would cost them. So the loyalty program characteristics optimal at one point can differ from what works best at another point.
     Another example of this: What motivates the customer starting the program is different from what works as the customer draws closer to the reward. Researchers at University of Texas-Austin distinguish between mindsets I’ll call “Will I ever buy enough to earn a reward?” and “How much more do I have to buy to earn a reward?”
     At the start of the loyalty program participation, a quick accumulation of points is evidence that goal attainment is possible. But, further along, what motivates the “How much more?” mindset is a relatively slower velocity. The reason for this second one is less direct: If it takes more effort to achieve a goal, as long as the goal is attainable, the payoff seems more valuable.
     The researchers compared the effectiveness of two types of loyalty club cards at a coffee shop. The uniform velocity card gave the customer three points for each purchase, and when the customer got 24 points, there was a reward. The variable velocity card gave five points for each of the first four purchases, and then one point for each of the next four purchases. Again, when the customer got 24 points, there was a reward, so what was required for each card was a total of eight purchases.
     Consumers with the variable velocity card completed the card more quickly.

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

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