Monday, November 25, 2024

Slope Down Discounts for Slope Use

It’s better to tell customers they’re paying less than to say they’re paying more. An Inland Norway University of Applied Sciences study found that a sample of alpine skiers and snowboarders living in the eastern part of Norway considered a pricing structure to be fairer if told that a discount is given for use of the ski area slopes during the week than if told a surcharge is applied for weekend use.
     But the discount magnitude made little difference in perceptions of fairness for discount amounts ranging between NOK 50 and NOK 150 (equivalent to about $5 to $15). The researchers conclude that managers can adapt discount levels based on their price optimization models without major concerns about how the discount level will affect the perceived fairness. In my email exchange about the study with Per Kristian Alnes, the lead researcher, he points out that this does not necessarily mean setting small discount amounts.
     The researchers then analyzed the effects of discounts for advance purchasing on perceptions of fairness. To what extent would a customer of ski slope use consider it fair or unfair if someone who purchased the pass 30 days in advance pays less than does someone who purchases their pass the same day as they use it? For this survey, the intervals presented to the participants ranged from 0 to 30 days and the discounts ranged from NOK 100 to NOK 300.
     The study participants’ responses showed a trend in which a greater discount for a greater number of days of advance purchase is considered fair. This was true both for survey respondents asked to imagine they’d gotten the early bird discount and those asked to imagine they’d not gotten it. However, the differences between same-day and 7-days-advance were noticeably larger than the differences between 14-days-advance and 30-days-advance. And for the 30-days-advance, a discount of NOK 300 was not rated as significantly fairer than a discount of NOK 100. Based on this finding, the researchers recommend that service providers set small discounts for early bird purchases.
     This set of studies did not directly explore how perceptions of unfairness impact shoppers’ purchase likelihood. The researchers do note prior studies showing how perceptions of a retailer’s unfairness can reduce customers’ subsequent buying intentions and can increase customers’ criticism to others about the retailer.
     Are these recommendations valid only for ski area proprietors serving alpine skiers and snowboarders living in the eastern part of Norway? Almost surely not. Discount amounts and pre-order intervals might differ, but the general conclusions are supported by other studies. The amount of a promotional discount has less consumer impact than does the discount’s availability.

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Fare Well with Fairness Intuition 
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Monday, November 18, 2024

Gaze at How Eye Contact Shows Charisma

Charismatic speeches by workplace leaders –compared to standard speeches or performance-contingent financial rewards – increased workers’ output by 17%. Researchers from University of Liechtenstein, University of Innsbruck, and Free University of Bozen-Bolzano report this compelling finding from a prior study in order to highlight the importance of charisma as a persuasion tool.
     The researchers also point out a gap in that and many similar prior studies: The studies fail to tell leaders what specific behaviors produce charisma impressions. Aiming to remedy this problem, their own studies find that one behavior is gazing at the eyes of the audience members. Leaders exhibiting more pronounced eye-directed gaze were rated as more charismatic in ways which inspired audiences to exceed workplace performance expectations.
     The surprise in the studies was not that charisma was associated with persuasiveness. Three of the survey items that raters used to measure charisma were “Has the ability to influence people,” “Has a presence in a room,” and “Knows how to lead a group.” What is more surprising is that a technique seemingly as simple as an eye gaze is closely associated with those three characteristics, which themselves have shown a statistical and conceptual association with each other.
     When you gaze at someone, you capture their attention and you verify their importance to you. You’ve considered them worth focusing on. Moreover, eye contact facilitates a synchronization of brain waves between two people, which is associated with synchronization in their opinions.
     These were correlational studies, so we can’t confidently conclude that all you need to do to impress as charismatic is to simply start gazing at the eyes of your audience members. The more defensible conclusion is that eye-gazing is part of a set of behaviors which hold promise for signaling to audiences your leadership skills and thereby for improving your persuasiveness. The nature of those behaviors is suggested by the wording of the other three survey items used in the rating of charisma: “Can get along with anyone,” “Makes people feel comfortable,” and “Smiles at people often.”
     The researchers argue that the significance of eye gaze arises from it not being simple to do correctly. Maintaining the gaze requires attention. Yet for the gaze to achieve desired results, the leader must also maintain attention to the message intended for delivery. The researchers also caution that their studies haven’t identified how to avoid irritating others with contrived or confrontational eye contact.

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Image at top of post based on photo by Kelly Sikkema from Unsplash

Monday, November 11, 2024

Weigh Disposal Over Depletion for Less Waste

People use three justifications for purchasing products manufactured in wasteful ways: 
  • Finances. “Especially now, when money is so tight, I want to get the most for what funds I have. If a product is manufactured or packaged in a way which produces waste, but gives me more value for my money, I deserve to be able to purchase it.” 
  • Institutional dependency. “The government and the industry leaders should be setting the standards that will minimize waste. If I go it alone, my individual actions won’t make any noticeable difference.” 
  • Cynicism. “To succeed in the competitive marketplace, every business has to engage in wasteful practices at least occasionally.”
     These justifications often lead shoppers to show willful ignorance of waste in manufacture of their purchases. Still, because shoppers generally do want to consider themselves as socially conscious, include waste minimization as a selling point. For best impact, feature that information prominently in ads the prospect sees before shopping with you.
     Also, emphasize announcement of the type of waste avoidance which is most important to consumers. Studies at University of Kentucky and Pennsylvania State University concluded that this is reduction in discharge into the environment of scrap after the manufacturing process. Of relatively less importance is reduction in use of raw materials taken from the environment. In the study, participants were presented a Facebook ad with the message “Outland Denim. We use up to 50% less water. We consume up to 50% less energy” or with the message “Outland Denim. We discard up to 50% less wastewater. We generate up to 40% less energy emissions.”
     The clickthrough rate was significantly higher for participants receiving the second message.
     Both types of waste are destructive, however. In a survey conducted by the researchers, a group of sustainability experts said that production waste arising from excess resource use is as important as waste arising from excess disposal, if not even more important.
     Results from the researchers’ further studies indicate that marketers can boost relative consumer attention to decreases in raw material usage by adding a resource scarcity or a long-term orientation prompt. The resource scarcity message was, “The Earth’s natural resources are finite and increasingly scarce. For example, water and other resource shortages are growing around the world.” The long-term orientation message was, “The future of the Earth is under threat. For example, our actions now will create growing environmental problems around the world for future generations.”

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See Through Anti-Waste Consumers 

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Monday, November 4, 2024

Embrace the Prosocial with the Embarrassed

Overcoming a prospect’s sales resistance is easier when you’re able to discern what the prospect wants next. Sometimes that’s perfectly straightforward. If it’s raining outside and the shopper asks where you stock the umbrellas, you can safely conclude that the shopper wants an umbrella.
     Sometimes it’s not so straightforward. Researchers at O.P Jindal Global University, University of Southampton, and Indian Institute of Management say that when a shopper is embarrassed, their interest in environment-friendly and sustainable products grows.
     The researchers’ explanation for the effect is that embarrassment leads us to want to re-establish our social standing in the opinions of others. Showing a commitment to the welfare of the environment can serve as an effort to do that. This does mean that the embarrassment motivating the purchase of prosocial products depends on the preference being expressed publicly.
     The wrinkle here is in you discerning that your shopper is indeed embarrassed. In the research studies, a state of embarrassment was activated by asking study participants to write about an incident from their past life in which they felt very embarrassed. The consumption preferences of these participants were compared with those from a group who had been asked instead to write about how they spend a typical day.
     For some of the research, the preferences measured were between two T-shirts, one described as manufactured with no harm to soil or water and the other described as manufactured to enhance softness and comfort for users.
     In your selling, you could encounter shoppers who start talking about being embarrassed. This is a signal for you to describe in front of others the prosocial benefits of items you offer the shoppers. It’s more likely the reason to suspect embarrassment will appear in another way. It might be in the type of product chosen. Buying foot fungus medication or incontinence pads probably carries some degree of embarrassment. Embarrassment also arises when a shopper uses discount coupons or witnesses another shopper committing a significant faux pas.
     A promising confirmation of embarrassment is the shopper’s body language. In a study where University of Texas-Austin students were assigned to purchase a present for someone who wanted an item carrying the logo of UT archrival Texas A&M, the shoppers fidgeted, chewed on their lips, and averted their eyes. They crossed their arms, as if to distance themselves from what they were doing.

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Bare Asinine Oversights That Embarrass 
Image at top of post based on photo by Julia Taubitz from Unsplash