Monday, September 24, 2018

Pin Responsibility in Unhealthy Food Choice

To help your customers maintain health, accentuate their responsibility for any unhealthy choices. Researchers at University of Southern California, University of Michigan, and Simon Fraser University explored how this works with self-service versus being served unhealthy foods. Consumers in a waiting area were offered a free snack. At certain times, the snack was mixed dried fruits while at other times, and therefore for different consumers, the snack was Reese’s Pieces candies. For each group, sometimes the consumer was required to scoop the snack into a sampling cup from a large container, while for the other consumers, half-filled sampling cups were offered.
     With those offered Reese’s Pieces, about 31% of the observed people facing the prefilled cups took the candy. When required to serve themselves, absolutely none of the people accepted the offer. With those offered the healthier fruit snack, 16% took a prefilled cup, while 6% were willing to scoop for themselves.
     An interpretation of the results is that when people are required to put forth a physical effort to obtain an item, they’re less likely to do it, but this effect is much stronger for unhealthy items. Other studies by the researchers found this was because the physical effort, even if minimal, gave a sense of personal responsibility. You don’t feel as responsible for making the unhealthy choice when all you have to do is snatch it up.
     We don’t want to make choices excessively demanding for shoppers. Still, research at University of Chicago found that consumers who characterized themselves as “smart” rather than “not smart” evaluated products more positively when the products had been pushed back on the shelves rather than being in easy reach. With products where healthfulness isn’t an issue, a small challenge often boosts repeat sales.
     Not every challenge will end up decreasing overall consumption of unhealthy foods, however. Researchers at Technical University of Lisbon and at Tilburg University in the Netherlands found that people who hesitated eating a food product generally overcome their hesitations when presented with small packages more than when presented the equivalent amount in one large package. But, in addition, the people who went through the trouble of opening up a bunch of the small packages ended up eating more than did those who dug into the large package. The participants had said they thought using small packages would help them limit their consumption. Yet the opposite proved to be true.

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Challenge Smart Shoppers
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Monday, September 17, 2018

Argue with Me, Convinced

A sale is easier when the shopper agrees with the salesperson. But researchers at Virginia Tech documented a circumstance where it pays off to have the shopper briefly argue with us. This is when the person comes to us with a preference firmly set and we want to change that preference. Maybe a brand different from the customer’s habitual choice would both serve the customer better and increase store profitability. In the political arena, it could be that a citizen consistently votes for a certain political party and we’d like to have the citizen fairly consider an alternative.
     The challenge is that when a consumer makes the same choice many times, their mind closes against objectively evaluating alternatives. In fact, they’ll distort new information in ways that support their decisions. You could present compelling arguments for changing their reasoning, but the thrust of those arguments won’t pierce the closed mind.
     This selective perception doesn’t occur when the shopper or voter has made the choice once or only a few times in the past. Right after a consumer chooses one among options, post-decision doubt commonly causes the consumer to closely attend to the benefits that would be offered by what’s been rejected. At the other extreme, after the same choice has been made a great number of times, variety-seeking arises, at least among younger consumers, so there’s interest in considering alternatives.
     It’s between these two circumstances where we might want to disrupt the thinking. The Virginia Tech studies suggest that if the salesperson or political campaigner presents a statement which stimulates a brief debate about an issue not directly related to the purchase decision, this opens up the thinking to afterwards assessing alternatives in product, brand, or candidate.
     You don’t want to make a debatable statement that destroys your credibility as an influence agent. In the studies, statements like, “Reading is bad for the mind” and “Only people who earn a lot of money are successful” were used. I recommend against those. Instead, to apply the principle of a helpful argument, ask the shopper to defend a decision they made prior to the one where you want to change their mind. “For what reasons did you select that option?” you’ll ask, and then say, “Others might disagree with your decision.”
     Let them win the argument. Finish off by saying, “I see your point,” before moving back to the sale you’re wanting to make.

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Monday, September 10, 2018

Meddle with the Shopping Trip Middle

The price sensitivity of a shopper changes over the course of the shopping trip. Researchers at University of Kentucky and University of Groningen report that the nature of the change depends on whether the individual wants to keep to a tight budget. Budget-focused shoppers are more willing to buy higher priced options in the middle of their trip than at the beginning or as they are finishing up. On the other hand, shoppers not focused on a strict budget become relatively more price sensitive in the middle of the trip than at either end. The difference shows itself most clearly when there are a number of items being purchased and when the person is aware or made aware of the cumulative total of their expenditures as they shop.
     This phenomenon is useful to retailers who can assess whether the shopper is a budget or non-budget shopper and then track the shopper during the trip. As to the second of these, the salesperson asking the shopper, “What will you be looking for today?” allows that salesperson to determine what is the middle of the sequence. As to judging whether this is a budget or non-budget shopper, the choice among alternatives early in the purchase sequence is the evidence. For the budget shopper, suggest upgrades, add-ons like extended service contracts, and partner items toward the middle of the shopping trip. With the non-budget shopper, make those suggestions toward the end.
     In circumstances where a shopper intends to purchase one item on the trip, not a bunch, you might think the shopper with the budget would usually spend less money with you than the one without a budget. Surprise! Researchers at Brigham Young University and Emory University find that making a purchase with a budget in mind can lead the shopper to spend more if the budget is for one item.
     Say your customer has decided to spend no more than $150 on a mobile device. He sees price points at $80, $120, and $160. Sticking to the budget, the customer eliminates from consideration the $160 alternative. Because of how a consumer’s brain works, the result is that product quality and the inclusion of extra features become relatively more important and item price relatively less important. The customer is now more likely to select the $120 model, if it’s higher quality, than if budget wasn’t in mind at the time of choice.

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Monday, September 3, 2018

Toy Around with Impacts of Toilet Training

Psychoanalytic theory has fruitfully impacted marketing by bringing attention to subconscious motivations and merchandise symbolism. In 1956, psychologist Ernest Dichter, called by AdAge “the father of motivational research,” developed the highly successful “Put a tiger in your tank” slogan for gasoline company Esso/Exxon on the basis that people associate cars with power. The attractiveness to women of high heel shoes in spite of the shoes’ physical discomfort has been attributed to women’s subconscious drive to conquer penis envy. Hey, there are two of those phallic-shaped heels rather than the man’s one true phallus. Psychoanalysts would refer to this as women’s overcompensation.
     Now add to those impacts a research study about constipation, of all things. Researchers at University of Salento and York University based their studies on Sigmund Freud’s conceptualization of young children’s toilet training. This founder of psychoanalytic thinking described harsh or especially early toilet training as resulting in what some call an anal-retentive personality
     Study participants would be expected to hesitate candidly discussing their early childhood toilet training and their current position on a constipation-diarrhea self-rating scale. Therefore, the researchers used projective stimuli to make indirect qualitative inquiries. The outcome was that those who gave evidence of harsh toilet training were substantially more likely than the others to also show tightwad habits, discomfort with disorder, and stubbornness in consumer transactions, along with bowel constipation.
          The most compelling implications of these findings would be for medical professionals, such as physicians and pharmacists, when responding to symptoms of digestive disorders. Patients who report chronic constipation are especially likely to adhere to treatment regimens which emphasize neatness and, if financial expenditures are involved, to buy-in when money-off discounts are prominently featured.
Regarding other marketers, the researchers suggest that when you see tightwad tendencies, you expect to also see a high interest in cleaning products and a persistence in expressing complaints. The more general implication, though, is an appreciation for the influence of early childhood experiences on current consumer behavior.
     Still, beware of excessive application of psychoanalytic theory. As a prime example, though psychoanalytic interpretations emphasize the symbolism of phallic objects such as high heels, a quote often attributed to Dr. Freud himself is, “Sometimes a cigar is just a cigar.” Actually, the evidence is that the doctor never actually said or wrote this. But the existence of the quote does illustrate concerns about overdoing the interpretations. Concerns residing subconsciously, most likely.

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Monday, August 27, 2018

Back Up Shoppers at the Front of the Line

Retailers’ concerns about shopper queues generally center on those last few at the back of the line and on the experience of those last few as they’re waiting. Now researchers at RWTH Aachen University and WHU, both in Germany, urge retailers to also take into account the experiences of those in front of a long line once they get the service of a salesperson or cashier. The finding is that these consumers feel pressured to transact their business promptly because of a sense of others breathing down their neck, and this results in less satisfying impressions of the store, the staff, and the merchandise. When this happens at the store checkout, the dangers are particularly great, since this becomes the customer’s last memory of the retailer.
     The researchers went on to determine that two techniques ease these negative effects:
  • Have the salesperson or cashier encourage the consumer not to feel at all rushed in getting the help they want. This works because it places the responsibility for the extra time on the salesperson, removing the social pressure on the consumer. 
  • Maintain distance between the waiting line and the location where service is being delivered. In the studies, this was accomplished by keeping the line out of sight of the service location. My store experience indicates to me that greater distance, even when sight lines are maintained, can work well. 
     Additional research-based tips for easing the irritation of all those in the queue:
  • If you can see the end of the line, greet each person as they join, even if only with a brief smile and a nod. 
  • Periodically say to those in line, “I apologize for the delay. I’ll be with you soon.” 
  • As you welcome each new person coming to you, acknowledge that they’ve been waiting. 
  • If the lines are unusually long, remark about a possible reason, saying, for example, “My goodness, people seem to really like today’s sale.” 
  • Maintain quality internet access so people can pass the time with mobile devices. 
     When in a store queue, shoppers become highly vigilant. One reason is the extra stress caused by being in close physical proximity to people we don’t know. Another reason is to be sure social norms are respected, such as nobody butting into line and each person waiting about an equal amount of time. So the best way to handle queues is to keep those lines moving.

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Monday, August 20, 2018

Observe Risks of Your Obsolescence

Satisfy your customers, but not completely, some might say. Consider the retail services category of matchmaking. Researchers at University of Pittsburgh, Carnegie Mellon University, and INSEAD claim there’s a fundamental conflict of interest between businesses like eHarmony and their clients: If the matchmaking is too good, members will cement a relationship and discontinue their paid subscriptions. A parallel conflict would be suspected in job-hunting sites. As soon as you find the perfect fit between you and an employer, you terminate use of the service.
     Another INSEAD research collaboration, this one with Boston Consulting Group, explores other examples of a product, service, or provider becoming obsolescent for a customer. Appliance retailers and residential real estate agents are no longer needed for an extended time once the purchase of the refrigerator or the home is completed. Customers for smoking cessation aids stop being customers if the product is sufficiently effective. Purchases of pureed baby food stop when the ultimate consumer gets older, regardless of how well the product fulfilled its objectives.
     The advice is to recognize the risks and plan to avoid the obsolescence.
  • Broaden the range of interest in your services. Job search customers could be encouraged to continue their subscriptions in order to stay current on what’s available in order to plan their next career move. Matchmaking services can appeal to shoppers looking for a succession of dating companions rather than settling into a search for a marriage partner. Consumers from cultures accustomed to arranged marriages might be most comfortable with meeting a range of promising prospects from which a choice can be made. The Ashley Madison tag line—Having An Affair Made Easy—indicates there is even a market for matchmaking among those who are already married, although you might choose not to exploit that one. 
  • Provide a progression path. Gerber welcomes its eaters who have outgrown pureed to move on to a line which encourages the use of utensils. Appliance retailers can offer bargain models. Misrepresenting the durability of items you sell is bad business. But offering low-priced versions which are not designed to last as long as the traditional models provides a path for economically challenged consumers to get started and then upgrade as their financial situation improves. 
  • Encourage satisfied customers to recommend their friends to you and to recommend those friends recommend you to their friends. Weak links in referrals nicely augment the strong links. 
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Monday, August 13, 2018

Cap Off Profits with Endcap Impetus

Few among successful retailers ignore the selling appeal of endcaps—displays of products at the end of an aisle on a shelf or rack perpendicular to the aisle. In studies at University of South Australia, endcaps at the front of a store, facing the entrance or the checkout counters, uplifted sales by an average of 346%. Endcaps at the back of the store, facing the storage area or the building’s rear wall, uplifted sales by 416% on average. One explanation is that it’s easier to see products on endcaps than on aisle shelving.
     Tripling or quadrupling sales certainly enhances profitability, even considering that retailers commonly feature discounts on end-capped items. Actually, another explanation for the sales lift achieved from endcaps is that shoppers come to associate endcaps with good discounts and so pick out end-capped products because of subconscious habit. In other studies, the sales lift ranged from 23% to 1200%. Further, because only a small percentage of items can be displayed on endcaps in a typical store layout, a retailer can negotiate with suppliers to get slotting fee payments for endcap placement of products. This adds to the profitability.
     But those University of South Australia researchers were interested in the substantial difference between 346% and 416%. Why did rear endcaps lift sales more than did front endcaps? One reason is that the rear of a store is generally less crowded than is the front, so shoppers are more likely to linger at the back. But a more intriguing reason revealed itself when the researchers tracked down what led to the sales lift. For the front endcaps, it came mostly from increased purchases of the specific items that were on the endcaps. But for the rear endcaps, the sales uplift came largely from increased purchases of items on the aisle shelves adjacent to the endcaps. The rear endcaps were attention magnets, drawing people into the aisles.
     University of Minnesota studies indicate that you can increase this sales lift by featuring in the adjacent aisles items which are companions to those on the endcap and carry the same brand name. When a customer purchases an item carrying a specific brand name, the customer becomes more likely to prefer the same brand name when going on to select an accompanying item. Matching brand labels suggest to shoppers that the two products were specifically designed and tested to work well together.

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Monday, August 6, 2018

Construe to Fit Comparative Price

A chocolate candy might be thought of concretely in terms of the appeal of its particular ingredients or abstractly in terms of how good eating it leads one to feel. An ad for a diamond pendant could use the tag line, “Flawless quality and pure color,” in order to appeal to concrete thinkers, or “Make it unforgettable,” to appeal to abstract thinkers.
     Researchers at University of British Columbia and Nanyang Technological University find that the comparative price of the item often influences whether you’re better off using concrete or abstract benefits statements. If the price is comparatively low for that product category, shoppers show greater preference for the item when hearing or seeing concrete statements. If the price is comparatively high, use abstract statements.
     To demonstrate this had to do more with the comparative price than with the price itself, the researchers placed one-dollar chocolates next to ten- dollar slabs of artisanal chocolate during certain hours at a candy store. During other hours, the one-dollar chocolates were placed next to a group of twenty-five cent Tootsie Rolls.
     Shoppers during the first set of hours were more likely to purchaser the one-dollar chocolates when a low-construal, concrete, message was used. The other shoppers showed greater purchase frequencies of the same style of chocolates when a high-construal, abstract, message had been used. Similar results were found in studies involving expressed preferences for energy drinks, electric toothbrushes, and diamond pendants.
     There are other considerations in whether to use concrete or abstract statements. Studies at University of Southern California, Dartmouth College, and Yale University indicate that, with unfamiliar items, consumers are more likely to believe concrete than abstract benefits statements. Touching products stimulates sales more strongly with low construal levels.
     And there are methods other than benefits statements to mesh with the shopper’s construal level. Researchers at Erasmus University, Loughborough School of Business and Economics, and Norwegian School of Management discovered that shoppers are relatively more interested in concrete features when gazing down at the merchandise and relatively more interested in abstract claims when peering up.
     Consumers had been asked to state which of two printers they preferred. One printer was described as reliable and the other as being of high quality. Those consumers who needed to look down to see the printers favored the “reliable” printer on average. Those consumers who needed to look up tended to prefer the “high quality” printer.

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Monday, July 30, 2018

Absorb for Family Firm Success

Absorptive capacity is essential for your family-run store to thrive. Studies at University of Castilla-La Mancha supported this conclusion by using an instrument to measure the four components of absorptive capacity as generally agreed on by business scientists. Here is my version of those four along with why they are especially important for the family-run enterprise:
  • Acquisition. The business regularly exchanges information with others in the industry. This overcomes an inbreeding danger for the family-run store, in which management decisions are always made by the same select group. 
  • Assimilation. Ideas for improving the business are continually communicated and critiqued. Otherwise, senior family members can mistakenly believe junior family members understand the reasons for decisions, and junior members can hesitate questioning flawed ideas for fear of disrupting family peace. 
  • Transformation. The accumulated and critiqued information fuels innovation. One of the frequent upsides of a family-run business is stability, but without a strong transformation capability, the stability results in the business falling behind the marketplace. 
  • Exploitation. The business tests out prototypes before undertaking full implementations. This component of absorptive capacity facilitates both the innovation and the opportunities for critiques. 
     In a sample of 1,045 family firms, those reliably practicing the four above showed greater sales growth, profit growth, and growth in market share. An entrepreneurial spirit also proved important to success, but it operated through absorptive capacity.
     Family-owned stores too often lack longevity. That reality transcends languages and cultures. Consider the English-language versions of these maxims:
  • “Father merchant, son gentleman, grandson beggar” (Mexico) 
  • “Rich father, noble son, poor grandson” (Brazil) 
  • “From the stables to the stars and back to the stables” (Italy) 
  • “Wealth never survives three generations” (China) 
  • “Shirtsleeves to shirtsleeves in three generations” (U.S.) 
     Those were collected by investigators at Boston Consulting Group and Cambridge Advisors to Family Enterprise to flesh out the fact that only about one out of every ten privately-held businesses makes it through to the third generation.
     Family-run businesses have advantages. The loyalty among management members helps to persevere through the tough times. As long as the senior members cultivate a life outside the business, developing a succession plan is straightforward. The business projects an authentic sense of family to customers and prospective customers. According to research at University of Geneva, giving a sense of family is useful for retailer-to-business relationships, too.
     By incorporating absorptive capacity, your family-run business can realize these advantages for the long-term.

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Monday, July 23, 2018

Like Parent, Like Child, Like Buying

When approving purchase of a prom dress, is the mother or the father of the intended wearer likely to set a higher acceptable budget? Most retailers I’ve asked say it’s the father, but the research-based answer is not so straightforward.
     Researchers at State University of New York-Oneonta, Rutgers University, and University of Minnesota asked parents visiting a zoo to take a short survey about the zoo. Parents were selected to participate only if they were visiting the zoo with at least one child of each sex in tow. As compensation for completing the survey, the parent was offered a chance to win a backpack, small suitcase, and similar items. The parent could choose to enter the drawing for either the pink items from the “Girl’s Prize Pack” or the blue items from the “Boy’s Prize Pack.”
     It turned out that 76% of the mothers chose the Girl’s Prize Pack and 87% of the fathers chose the Boy’s Prize Pack. In a few other studies, too, these researchers found that parents favored expenditures on the same gendered child and that the explanation seems to be greater psychological identification with the same-sex child. There was also evidence that the pattern of preferences extends beyond parent-child pairs. Therefore aunts may be more comfortable making purchases for nieces, and uncles for nephews.
     When families shop together with you, it’s useful for you to identify the retail influencers. However, an important limit on the value of this set of studies for you is that the participants were required to choose between an expenditure on a boy or on a girl. In many circumstances, a parent can choose to purchase items for each of their children. Much research finds that in these circumstances, the adults endeavor to spread the expenditures equitably. It is when the extent of resources feels limited, such as when you want to upsell, that it pays off to sell through the same sex parent.
     Other studies have indicated that in tight economic times, both parents become highly receptive to spending more retail dollars on daughters than on sons. In any case, none of this should be used in a way which would alienate the father of the daughter or the mother of the son. To show how you like having the parent buy from you for the child, make clear that you like each parent and respect the preferences they express.

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Monday, July 16, 2018

Go Intense with Threatened Shoppers

If your shoppers seem unsure of themselves, up the intensity in what you present them. Bolder claims of purchase benefits, more expressive gestures, larger samples, item alternatives with brighter colors, areas of the store with stronger fragrances.
     Researchers at Indian School of Business exposed participants to messages which produced either high or low self-doubt about the participants’ intellectual abilities. Afterwards, those participants with self-doubt tended to prefer brighter colors and louder music than those without self-doubt.
     So going big helps make the sale. Except when it doesn’t. Researchers at HEC-Paris and Northwestern University concluded that when the large size of a product or package implies power, consumers craving more power go for the large. A set of study participants were offered a choice of different-sized bagel pieces. Those participants who felt powerless in the face of threats chose bigger pieces.
     But when small size implies status, consumers who feel relatively powerless will forgo the large. In another study, participants were offered four sizes of hor d’oeuvres. Some of the people were told that the largest ones had recently been served at a White House event. The rest were told that the White House event featured the small hor d’oeuvres. In this case, the status of being a White House appetizer outflanked the importance of size. The participants preferred the smaller items.
     Other studies have identified ways a retailer can influence a shopper’s sense of power. In a Northwestern University project, it didn’t take much: Some of the study participants were asked to imagine an actual episode in the past when they possessed high power in a situation. You could adapt that to discussions you have with a frequent customer.
     Show advertisements and store signage which emphasize the power possessed by the shopper (“At our store, you’re the boss”) rather than those which deemphasize the power (“At our store, we take care of you”). And treat the shopper with deference more than with authority.
     When the salesperson takes on the role of Coach or Playmate, this builds the sense of power of the shopper.
  • The Coach reassures us. The customer expects the Coach to be available until the problem is solved and to encourage the customer to buy whatever is needed to solve it. 
  • The Playmate loves fun. The customer expects the Playmate to be more interested in how the shopping experience feels than in how the product or service works. 
For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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Monday, July 9, 2018

State That Status Shouldn’t Affect Service

Effective salespeople adjust their approach to each customer’s characteristics, and highly skilled salespeople use observations of each customer’s appearance to assess those characteristics. Still, none of this means your store’s salespeople should treat low-status shoppers shabbily.
     Researchers at Catholic University of Eichstaett–Ingolstadt and National University of Singapore analyzed how frontline employees handled angry complaints from female customers about flawed service. The researchers defined high status customers as those wearing business dress and having professionally styled makeup and hair. Those wearing the equivalent of jeans and a T-shirt and not appearing to have professionally styled makeup or hair were defined as low status. The researchers found that, compared to the treatment of the high status customers, the low-status angry complainers were less likely to be offered restitution to compensate for the dissatisfaction and were more likely to be yelled at by the employee.
     But this difference reliably occurred only in businesses judged to have an overall poor service climate. In the businesses with a high service climate, customers with angry complaints were handled adequately regardless of apparent status.
     You should not tolerate mistreatment of your employees by angry customers, no matter how bad the service transgression. However, yelling at the customer is not a proper response, and the response should be based on respect, concern, and empathy regardless of the social status of the customer.
     It is important for everyone on staff to be clear in words and actions that all shoppers are to be treated fairly. Discrimination in retailing is often subconscious.
     Some frontline retail staff carrying biases against minorities operate on the assumption that it’s only the minorities who are disturbed by discriminatory behavior. Since the prejudiced staff member decides consciously or subconsciously that they’d prefer not to do business with minorities anyway, they resist changing their behavior. But studies out of Clemson University and University of North Carolina-Wilmington saw how discriminatory behavior has more widespread effects on customer goodwill than those prejudiced frontline staff acknowledge. Many white shoppers became as outraged as blacks when the white shoppers observed a black customer being treated in a discriminatory way. All the customers are watching.
     Discrimination on the basis of race is illegal. Subtler forms of discrimination may not be against the law, but they’re still bad business. Michigan State University and University of Notre Dame researchers found that physically unattractive shoppers are frequently targets of rudeness and exploitation.

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Monday, July 2, 2018

Disentangle Religiosity Effects on Shopping

For some time, consumer behavior researchers have noticed that patrons adhering to an organized religion will shop in distinctive ways. Identifying those distinctions could be valuable for retailers because many religious patrons frequently witness their faith in readily observable ways.
     But researchers at University of Wyoming caution the effects depend on whether the shopper is affectively or cognitively religious. People whose faith is primarily affective would strongly agree with statements like, “God is an important influence in my life.” The affectively religious take comfort in a personal relationship with a divine being. On the other hand, those whose faith is primarily cognitive would strongly agree with statements like, “The scripture of my religious affiliation is the word of God.” These consumers take comfort in adhering to a firm set of required and forbidden behaviors integral to the religion.
     Religiosity is associated with shopper conservatism and self-control. Research based at University of North Florida found that consumers who are more religious are more likely to be repeat store customers. This was true whether the religious folks were Protestants, Catholics, or Buddhists—the three faiths represented in the study sample. Consumers showing lower levels of religiosity or declaring themselves to be non-religious were more likely to switch stores from one shopping trip to the next.
     In addition, religious shoppers are more likely to be consistent tightwads than are non-religious shoppers. But other research evidence has defined tightwads as believing they should be spending more. Loosening up the self-control a bit could profitably serve both the shopper and your bottom line.
     The inquiry about differences between the affectively and cognitively religious discovered that with the affectively religious, commenting on religious beliefs in the purchase situation led to a strengthening of the self-control. With the cognitively religious, it relaxed self-control. Listening to how your shoppers evidence their religious beliefs helps you select a proper sales approach.
     Also disentangle the effects of religiosity, spirituality, and ethicality. Researchers at Appalachian State University and University of Nevada-Reno administered a Human Spirituality Scale asking how strongly one agrees with items reflecting a reverent compassion for the welfare of others, a larger context or structure in which to view one's life, and an awareness of life itself and other living things The participants were also presented with a set of situations measuring business ethics. Overall, those scoring highest on the HSS showed the lowest adherence to business ethics.

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Monday, June 25, 2018

Tool Up for Word-of-Mouth

What stimulates your customers to spread good news about your store? Researchers at Aston University and University of Surrey set out to answer this and related questions by analyzing results from prior studies conducted on a grand total of 239,000 shoppers from 41 countries regarding 24 tools.
     The tools—also called instruments or factors—that made the biggest difference for word-of-mouth (WOM), according to the meta-analysis:
  • Excellent customer service 
  • A coordinated blend of attractive visual décor, appealing music, and tempting scents 
  • Easy maneuverability around the store 
  • A useful mix of other types of retailers in the vicinity of the store 
     These four have outsized importance because they lend themselves well to brief reminiscences shoppers can relate to family and friends about their shopping experiences.
     The researchers were initially surprised that low prices didn’t make the cut as a top tool. Their explanation is that people enjoy getting a good deal, but fear that bragging about it to others will make them look cheap, threatening their social standing. It also could be that even those figuring they got a good price think others would consider it not good enough. Studies at University of Alberta, University of Calgary, and University of British Columbia found that when people believe they might have been able to wrangle a better deal on a product or service, this conclusion leads to them feeling a threat to their self-esteem and their self-image. They fear not only that others will see them as being suckers, but also that they’ll see themselves that way.
     Because of WOM’s value, are you now tempted to repeatedly point out to your shoppers how you’re doing well on those top four factors identified by the meta-analysis? Curb that urge. Researchers at University of Miami and University of Pennsylvania say you’d do better by hinting at it and allowing your shoppers to discover the rest for themselves. Customers are substantially more likely to share WOM with others if they have found at least some of the information on their own. In addition to the thrill of discovery, a major reason for this is that we associate discovered information with our self-image. We are less likely to criticize the information as unfounded or uninteresting.
     The advice for retailers wanting more WOM is to build shoppers’ knowledge about what is offered, then encourage shoppers to uncover for themselves the full extent of the four tools.

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Monday, June 18, 2018

Indulge in Group Nostalgia

When you stimulate within your shoppers fond memories of the past, they’ll yearn to eat candies and cakes with close friends. The explanation for this strange specific finding by researchers at Monash University, East China Normal University, and Chongqing Technology and Business University leads to broader lessons about how to employ nostalgia in retail sales.
     That explanation has to do with nostalgia emphasizing positive beliefs and feelings, with flashes of the indulgences and family support from consumers’ childhoods even if the fond memories are not primarily of childhood. As a result, nostalgic shoppers become less concerned about how others will judge their consumption decisions. This effect is stronger when the nostalgic shopper is actually accompanied by supportive family or friends. In the research, the relationship between a nostalgic frame of mind and consumption of indulgent foods was weakened when the consumer was told they’d be eating with strangers or eating alone.
     For these studies, nostalgia was generated by showing participants photos from the 1970s. Fragrances have also been used. But which stimuli will work does depend on when the target audience was born. The odor of hot chocolate and cinnamon has stronger effects on shoppers born in the 1940s than on those born in the 1970s.
     Item scarcity boosts existing feelings of nostalgia. And general social trends are a force. Among consumer psychologists, there’s a sense that nostalgia appeal grows during periods of uncertainty, such as from economic downturns or cultural isolation. Researchers from Arizona State University and Erasmus University in the Netherlands concluded that if people are feeling lonely, they get interested in nostalgia. When made to feel socially uncertain by the experimental manipulation, consumers became more likely to prefer automobile makes, food brands, TV shows, movies, and even shower soaps which reminded them of their personal history.
     In another example of the relationship between nostalgia and indulgence, nostalgia appeals have been found to loosen a consumer’s purse strings. Researchers at University of Minnesota, University of Southampton, and Grenoble École de Management asked each study participant in one group, selected at random, to think about their past. The remaining study participants were asked to think about recent or future events. Then each study participant was asked how much they’d pay for a set of items which were described by the researchers. The group who’d been asked to think about their personal past came in with higher bids overall.

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Monday, June 11, 2018

Time Your Talk to Facilitate Transactions

Imagine that, while you are talking with the front desk clerk at a hotel, he tells you a story:
You know, some weeks ago one of our guests asked me when our bar opens. I was here in the reception when he called – at 3 a.m. I said that the bar opens at noon. About one hour later, the guest called again and asked when the bar opens. Now he sounded a bit drunk. Again, I said it opens at noon. After another hour, he called again and asked when the bar opens. I think he was more drunk this time. I said that the bar opens at noon, and that I could have room service send something up to the guest if needed. Then the guest said ‘No, I don’t want to get in…I want to get out! 
     Was that joke good enough to draw a chuckle from you? Would the joke give you more positive feelings about the desk clerk and the hotel?
     Now I’ll add some details. Let’s say the desk clerk starts telling you this story late in the evening when you’re checking in to the hotel and are anxious to get to your room. Researchers at Stockholm School of Economics and University of Oulu found in that situation, the joke facilitated perceptions of the desk clerk as a fun person, but lowered customer satisfaction with the hotel.
     The ready explanation is that hotel guests in this situation aren’t purchasing the services of a fun person. They’re paying for smooth hotel check-in, not a standup comedy routine. The astute front desk clerk—or retail store salesperson or professional practitioner—will time their talk to facilitate transactions. Further, even when the consumer isn’t in a hurry, humor can be a promotional vampire. The audience starts paying more attention to the joke than to the sales message.
     This doesn’t argue against ever joking around with a consumer. There are many situations in which a light touch eases a shopper’s decision making or dissolves a customer’s post-purchase doubts. Humor draws attention and generates word-of-mouth about the sales conversation. Humor heads off mental counterarguments. The shopper is too busy chuckling to challenge the sales pitch of the ad. And when happy, customers are more likely to make a decision to buy.
     Just remember that excellent timing counts when telling a joke, and also in when to tell a joke.

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Thursday, June 7, 2018

Top Off Preferences for More or Less

Some product attributes are MIB and others are LIB. For most shoppers, More Is Better applies to characteristics such as the number of pockets in a backpack or the abrasion resistance of paint. The quintessential Less Is Better attribute for all items usually is price. Sometimes, though, what is LIB for one shopper is MIB for another. Price level signals financial sacrifice, but also signals the extent of quality. A low caloric count tends to be perceived as both more healthfulness and less pleasant taste.
     This MIB / LIB typology was used by researchers at University of South Carolina, Wayne State University, Babson College, Indiana State University, and Stockholm School of Economics to develop recommendations for how to display and advertising offerings. To improve sales, arrange MIB alternatives within a product category so that the ones with a higher rating on that attribute are shelved above the others. With LIB alternatives, place those with a lower rating below the other choices. Follow the parallel logic in comparative advertising and with in-store signage which lists the alternatives.
     Often, a particular item will have a mix of MIB and LIB attributes. With a robotic vacuum, battery life is MIB while battery recharge time is LIB. In these circumstances, configure the options based on which of the attributes you want to feature, considering what shoppers come to you seeking in that product category.
     You’ll also want to consider other factors in the arrangements of merchandise on the shelves and item listings in ads and signs. For instance, researchers at Erasmus University, Loughborough School of Business and Economics, and Norwegian School of Management say that shoppers are relatively more interested in concrete features when gazing down at the merchandise and relatively more interested in abstract claims when peering up. 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.
     And placing heavier items on lower shelves makes it easier for customers to lift them and helps stabilize the shelves. Moreover, that configuration feels more natural to people’s brains, and what feels more natural is more likely to be purchased. The preference is so strong that it spreads to color considerations. Lighter-colored packages sell better when placed above rather than below darker-colored packages on the shelves.
     With all these considerations, experiment to discover what tops off profits for you.

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Monday, June 4, 2018

Cure Feelings of Retailer Betrayal

A customer’s feelings of betrayal are substantially stronger than a customer’s feelings of disappointment, and the consequences can be substantially more serious. The dominant motives of most dissatisfied customers are to restore a sense of fairness and vent negative emotions. But researchers at University of Bern and University of Texas-Austin found that a customer who feels betrayed by a marketer will frequently devote substantial efforts to harming the marketer’s reputation.
     Based on a subsequent set of studies, another team of researchers—from University of Texas-El Paso, University of Leeds, University of Cyprus, and Dokuz Eylül University—describe the characteristics of the betrayal feelings and, more importantly, ways to cure these destructive emotions.
     Betrayal occurs when the trustworthiness norms of a close relationship are violated. With marketer-customer relationships, the closeness is based on a series of sales transactions. Business relationships aren’t the same as personal relationships, although an advantage available to smaller organizations is the enhanced opportunity to create friendships with customers and clients. Such friendships might ease feelings of betrayal as long as expectations in the relationship are clear to all parties. When expectations are unclear, the hybrid business-personal transactions can instead aggravate a sense of betrayal.
     So clarifying expectations is a potent preventative and cure. The studies find this to be especially important around issues of what information will be disclosed. Customers don’t want to be overwhelmed with details, but they want to be informed. Marketers too often have a different view than do shoppers about what to share. Failure to disclose conflicts of interest were one trigger for feelings of betrayal, according to the studies. Another trigger was a failure to notify the customer that a promise made previously was at risk of not being kept. A retailer may well have thought, “I’ll be able to straighten things out before the promise is due,” while the customer ends up thinking, “If the retailer had told me early on that the promise might not be honored, I would have been disappointed when it wasn’t, but I wouldn’t have felt betrayed.”
     Catalyzing the consumer’s outrage is a sense of powerlessness. Restore the customer’s sense of influence by asking, “What can I do to make things right?” Just being asked and listened to can prevent the active sabotage. If the answer you get involves actions you’re not able or willing to take, you can come back with a reasonable alternative.

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Thursday, May 31, 2018

Maximize Surveillance of Maximizers

When you’ve a shopper who is intent on buying the very best, stay aware that this shopper becomes more likely to cheat and lie to get it. Researchers at Vanderbilt University, Concordia University, and Peking University attribute this phenomenon to the relationship between maximizing and a sense of scarcity.
     Consumer psychologists distinguish between maximizers, who want to choose the best possible alternative, and satisficers, who are pleased to settle for what’s good enough. Wise retailers also make this distinction, since it determines how to make the sale. Moreover, wise retailers realize the distinction isn’t always straightforward. Maximizers are usually willing to pay more money than satisficers and to spend more time deciding. But some maximizers are bargain hunters, searching for a deal on the very best. Other maximizers are happy to pay top dollar if they can depend on a trusted salesperson to quickly point them toward perfection.
     When people have a maximizing mindset, they experience a sense of scarcity. For one thing, they believe there is only one best option, while there are probably a number of fully suitable alternatives. In addition, because maximizers spend so much time expanding the choice set and evaluating each alternative, a feeling of time scarcity arises, and research finds that this feeling spreads through the mind to become a general concern about scarcity.
     But why does a general concern about scarcity potentiate immoral behavior? The explanation is evolution. We are evolutionarily structured to become more willing to cut corners in order to protect ourselves and those close to us at times when essentials are in short supply.
     It’s not that maximizers are comfortable with their lying and cheating. They justify it, but they realize others would consider it wrong. In fact, maximizers are more likely than satisficers to regret almost everything about the transaction, including doubts about the quality of the items purchased.
     This then becomes the key to decreasing the immoral actions. Recognize that maximizing is often as much a situational mindset as a chronic personality characteristic. People can change. Help ease the maximizing so your shoppers will come away feeling better about themselves and their purchases. Rather than say, “Let’s find the very best one for you,” say, “Let’s find a few excellent alternatives which you can select from.”
     Still, however, it’s probably best that you stay on full alert for shady shenanigans whenever you’re dealing with an inveterate maximizer.

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Monday, May 28, 2018

Excuse Me with an Interruption

When selling prospects on purchasing an item or an idea, it would seem you wouldn’t want to be interrupted or to interrupt yourself. Shoppers in a flow state buy more. With their highly focused attention, they are less likely to go back-and-forth about making purchases.
     Still, researchers at Boston University and University of California-San Diego find that a well-timed interruption improves the purchase potential with decisions the shopper considers to be risky. That conclusion is actually old news. Prior studies have found value in interruptions. For instance, researchers at Cornell University and University of Toronto suggest that when a shopper is feeling overwhelmed by a difficult decision, you encourage the shopper to go on to another item on their shopping list and then come back in a short while to make the purchase decision. The interruption instantly relieves the sales pressure as the decision is temporarily suspended.
     But this later research reveals another explanation for the value of an interruption with risky decisions: When the person comes back to the decision situation after the interruption, they’ll probably reorient themselves by briefly reviewing what was covered before the recess, they’ll consequently go over material they’d processed before, this repetition adds familiarity, and what is more familiar engenders less apprehension.
     For this to work, you must bring the shopper back to the decision following the interruption. This means staying with them or tracking them down. Most consumers are more open to interruptions early in the purchase process and less open later. However, researchers at New Mexico State University and Sacred Heart University suggest that the retailer look out for the potential customer who seems pressed for time and is evaluating choices almost from the start. Minimize interruptions of these people early on and never interrupt early on with content not directly related to the purchase selection, such as with an extended greeting or casual conversation. With the shopper who is in this frame of mind, later interruptions are okay, and can actually create good will, as long as the interruptions are pleasant, such as reassurance or gratitude, and they’re not frequent.
     Another set of researchers, at Stanford University, note how in-store shopping can be subject to a plethora of interruptions from sources other than the retailer—phone calls, texts, impatient children. To the degree that the retailer can control additional ones, the sale of the item or idea is more likely.

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Thursday, May 24, 2018

Whack Price-Beating Policies

Consumer behavior research identifies payoffs for retailers in advertising price-match guarantees. “Find a better price on the same item, and we’ll honor that difference,” the store promises, and shoppers’ purchase intentions increase. This is because consumers interpret the promise to mean the store has low prices, so the shoppers’ motivation to search elsewhere fades.
     But does this mean you’ll increase revenues even more by advertising a price-beating policy? “If you purchase an item from us and then find the identical item at another store or online for less, we’ll give you double the difference in store credit.”
     Notice how the conditions of such a price-beating promise tilt in favor of the retailer. The consumer needs to purchase the item from the store in order to take advantage of the offer, and the refund is in credit, not cash, meaning that the consumer will need to spend the refund at the store.
     Even with this, though, researchers at Ghent University and University of Cambridge find that a price-beating guarantee is inferior to a price-match guarantee at increasing profits. One reason is that shoppers are less likely to trust the overall pricing policies of retailers who offer price-beating claims. Another reason is that compared to price-match claims, the price-beating claims attract a higher percentage of bargain hunters with little store loyalty. They’ll always be looking for even better offers and have little hesitation in switching suppliers.
     Price-beating also can come back to bite the retailer. The researchers recount the tale of a 2011 Tesco offer to double the difference if customers found purchased items at a lower price at an Asda store. One shopper took up Tesco on the deal by carefully selecting items which cost £38.46 at Tesco and £17.48 at Asda. Keeping the promise, Tesco issued a voucher equivalent to £41.96 to the customer, who walked away with free products plus also a little extra to spend.
     Sometimes the price matching itself might be unnecessary. When asked if you can meet a competitor’s price or the internet price, avoid saying no. That word irritates shoppers. Instead, say “Here is what I can do.” Then talk about items like:
  • Discounts for quantity purchases or purchase as part of a combo pack 
  • Delivery at times demand is slow for you 
  • Extras you offer, such as gift wrapping, training, or installation 
  • A discount on subsequent purchases, such as through a loyalty program 
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Monday, May 21, 2018

Endorse Policy, Not Character, Political Attacks

In political campaigning more than in any other arena of consumer persuasion, the saying “Be careful what you wish for, since you may receive it” often applies. A provision in the federal Bipartisan Campaign Reform Act, introduced by Republican U.S. Senator John McCain and Democrat U.S. Senator Russ Feingold, requires candidates to include in their ads a statement like, “Here is my name, and I approve this message.” The objective of the provision was to reduce political attack ads on the assumption that a candidate would be ashamed to personally and publically claim responsibility for such poisonous words. Ironically, though, the outcome of the provision, according to studies conducted at New York University and University of California, Berkeley has been to bolster voters’ belief of negative political advertising.
     The ads for which the personal endorsement most clearly increased credibility were those attacking a political opponent’s policies. The effect was not seen as clearly for attacks on an opponent’s personality. With these personal attacks, the degree to which the voter accepted them as justified did not depend on whether the “I approve this message” language was included.
     The researchers found three mechanisms of the negative policy attacks effect:
  • The candidate’s name attached to the ad gave it truth value. Other research suggests that if, in a printed ad, the candidate’s signature appeared, the truth value would be even higher. 
  • The use of the words “I approve” reduces the aggressive tone of the message itself and therefore relaxes the message recipient’s suspicious reaction to the vitriol. 
  • The formal structure of the notice with phrasing the voter has seen in other ads indicates that the ad is conforming to regulations, and this perception of conformity enhances its credibility. Other research suggests that some sort of official seal on the ad would increase the credibility further. 
     The general principle of consumer psychology here is that when you take personal responsibility and follow a well-recognized set of rules, whatever negative statements you make will have extra credibility. Regarding the retail store arena, researchers at European University Viadrina found that when a salesperson volunteered negative information about a product being considered by the shopper, the shopper became more likely to trust everything the salesperson said. But keep your words and logic simple. The researchers also found that with complexity, shoppers often won’t hook the talk of negative information to the salesperson’s credibility.

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Thursday, May 17, 2018

Keep Calm to Carry On Seniors’ Fraud Evasion

Consumer behavior researchers disagree about whether elderly adults are more susceptible overall to financial scams than are younger consumers. But the researchers do agree that the nature of the susceptibility and the dangers of succumbing to the fraud are more serious for senior citizens. Regarding the seriousness, seniors are more likely than young adults to be living on a limited income and to have fewer years to make up for large financial losses.
     Regarding the nature of susceptibility to fraud, researchers at Stanford University, Duke University, Humboldt University Berlin, Financial Industry Regulatory Authority, and AARP prefaced their studies by noting two risk factors for fraud are more common in the elderly—decreasing ability to accurately recall information from ads and to detect lying in face-to-face interactions.
     The researchers then went on to explore another risk factor which has been less well recognized—how emotional arousal, such as that famously used by successful con artists, interferes with critical thinking skills. This happens in adults of all ages, but the effects grow worse as we age.
     Older consumers respond to emotion-laden sales messages (“The aroma of our coffee brings waves of contentment”) more strongly than to purely rational sales messages (“Award-winning taste at a lower price”). Emotional appeals also result in senior shoppers remembering details about sources of sales messages more accurately. The seniors are especially receptive to positive emotions, so in a fraudulent sales pitch, they will pay more attention to the touted benefits than to signs of danger and will remember those benefits more clearly.
     The upshot of all this is that we can help older adults evade fraud by encouraging them to enter the consumer situation calmly, maintain calmness during the transactions, and insist on enough time to calmly consider tradeoffs prior to finalizing a purchase decision.
     Seniors will probably embrace this advice. They don’t want to be defrauded. Plus, unlike their young counterparts, seniors generally find happiness more in calmness than in excitement. They’re the type of consumers who in studies at Stanford University, MIT, and University of Pennsylvania would select “a relaxing blend of chamomile and mint” over “a refreshing peppermint blend” and a bottle of “Pure Calm” water labeled in green over “Pure Excitement” labeled in bright orange. In other research, older adults preferred calm TV advertisements with few camera changes, slower speech, and relaxing or no music over more arousing advertisements.

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Monday, May 14, 2018

Build Up Bawl Outs When Telling Complainers

A customer who encounters flawed merchandise or service from your business often yearns for the person who is responsible to be bawled out. That’s according to researchers at Florida State University. In fact, the researchers found that a promise the employee will be reprimanded is among the most effective ways to keep from losing a snubbed customer.
     However, the researchers also found that the customers want reprimands delivered out of their presence. They want harshness, yet don’t want to witness the harshness. They also want the employee to be granted the respect of privacy.
     These findings are in accord with others, from University of Southern California, which concluded that about 40% of retail consumers report how at least once each month, they see a store employee treat another store employee so rudely that the customer gets less interested in shopping at that store. A supervisor reprimanding in front of a complaining customer the employee responsible for the shortfall may be intending to demonstrate respect for the customer. But this message is severely undercut by the failure of the manager to show respect to the salesperson in front of the customer.
     Moreover, it’s best that you not be harsh even in private. You’ll get better results when you fix the problem instead of fixing the blame. Holding people responsible is different from fixing blame. Estimates by psychologists at New York University and University of Tulsa suggest that about 70% of retail employees will do less well in a store like yours if you put more emphasis on fixing the blame for the problem than on fixing the problem that caused the setback.
     When serious problems arise in your retail business, hammer out the difficulties in supportive ways. Use your hammer to repair the shortfalls, not to pound your valuable staff—and consequently, their staff morale—into the ground. Stop at embarrassment, short of guilt or shame.
     Still, amplify the degree of intensity when telling the complaining customer what action you’ll be taking. Your words, voice tone, posture, and gestures should all convey that you consider the complaint to be consequential, and thus there will be consequences. With a loyal customer who feels highly scorned, telling them afterwards that a serious reprimand was delivered is useful. Actually, it’s possible the customer will say, “Oh, it wasn’t really that serious,” a mindset which further counteracts any desire to take their business elsewhere.

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Thursday, May 10, 2018

Generate Seniors’ Generativity Now

People donate higher amounts if asked to pledge a charitable donation in the future than if asked to give right now. As a result, charities can find it advisable to put off the collection date. However, this temporal discounting of donation amounts applies from the perspective of the charity, too. Getting money sooner is better than getting money later, everything else being equal.
     Good news, then, from Ryerson University researchers which finds that this temporal discounting among donors fades markedly as the donors get older. Senior citizens show fewer differences between donation-now and donation-later amounts than do younger adults. The researchers’ explanation is that as we age, our generativity—concern about future generations—grows, resulting in greater altruism and willingness to donate now.
     Seniors like to give their business to retailers who are compassionate, and they like to view themselves as generous. One dynamic behind this is a desire to leave behind a legacy of love. Maybe behind this, in turn, is a calculation of what will be required on the résumé submitted at the Pearly Gates.
     The increased generosity does not appear to be due to greater net worth or lower cognitive abilities as people age. And the fading of the temporal discounting applies only to charitable donations. As it comes to spending money in other ways, older adults still show a willingness to devote larger amounts when the due date is in the future than when approaching soon.
     When soliciting older potential donors, the advice to charities is to ask for the money to be contributed now, not later.
     The range of the request counts, too. In a field study based at France's ESSEC Business School, a request for a small amount increased the willingness of the person to make a donation at all, and the larger the greatest amount in the same request, the higher the eventual donation. In a solicitation containing a scale of suggested contributions, a range of $5 to $1,000 would serve better than one of $20 to $500.
     Still, there is a boundary condition to the change in temporal discounting with charitable donations: The degree of altruism levels off at about age 75 and decreases somewhat thereafter. With the older old, then, the size of donations is likely to be highest with planned giving, in which the donation is made via a trust or will which will be activated in the future.

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