Monday, December 17, 2018

Chimp Away Sales Resistances Using Scarcity

Hey, marketers! Been thinking lately about the shopper psychology of chimpanzees? I’ve been, and you should be, too, at least for long enough to consider the question, “Why do scarcity appeals work with your customers?”
     Researchers at University of California, Duke University, and University of Warwick asked that sort of question after noting the ways in which consumers are often more likely to purchase items they perceive to be in short supply. In a classic consumer psychology study, participants were presented a set of Nabisco chocolate chip cookies. For some participants, two cookies were presented, while for the others, ten cookies were there. Which group gave higher ratings to the attractiveness, liking, and willingness to pay? Yes, the group that saw only two cookies.
     But do scarcity appeals hold for children as well as for adults?
     In a set of experiments, the answer turned out to be yes for six-year-olds, but no for four-year-olds. The researchers also evaluated for scarcity appeals in a set of chimpanzees. From an evolutionary perspective, chimps are human’s closest extant relatives. If they demonstrate a scarcity appeal, this would indicate the scarcity appeal for humans had evolutionary advantages. As with the children, the chimp was given a choice between one attractive item selected from a pile of identically wrapped goods or one wrapped attractive item which was standing alone.
     The chimps showed no scarcity preference. It appears that the genesis of the scarcity appeal is not in fundamental evolutionary adaptation, but instead in learned human social interactions of the sort which begin to develop at around age six. The researchers’ conclusion is that it arises from a desire to feel special. This interpretation was supported by comparing results for the children when they made the selection in the presence of other children versus when they were by themselves when choosing.
     Bringing it back to the world of maximum effectiveness in marketing to your target audiences, pair scarcity claims with benefits statements having to do with distinctiveness.
      Along with this, recognize the related research-based motivations for a scarcity appeal:
  • Desirability. “People in the know are wanting what’s available.” 
  • Status. “Many aren’t able to afford what I have.” 
  • Nostalgia. “I’ll preserve memories of expired possibilities.” 
  • Quality. “Lavish attention must have been devoted to each item.” 
  • Competitiveness. “Others who don’t have this are comparative losers.” 
  • Reactance. “I want to have what others tell me I can’t have.” 
For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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Monday, December 10, 2018

Color Clients to Die Green

When you’re thinking about being six feet under, you’d prefer the grass and trees above you to thrive. That’s one interpretation of the conclusions from researchers at National Central University in Taiwan, University of Brawijaya, National Dong Hwa University, and Vietnam’s University of Economics. The researchers found that consumers who contemplate their own death with trepidation become more likely to engage in green—ecologically conscientious—actions.
     This applied to favoring actions which minimize the demolition of natural habitats, avoid the use of toxic substances, prevent pollution, and reduce wasteful consumption of energy. In the studies, death anxiety prompted these actions more strongly than did an attitude of social responsibility.
     This doesn’t mean you should arouse contemplation about death solely to encourage green behavior. But it does mean you can work toward fulfilling your responsibilities to society by encouraging customer contemplation of green behavior in circumstances where discussing death is an integral part of the sales process. This would apply to life insurance, funeral planning, and estate planning, for example. In addition, there are certain times when death is more likely to be thought about by your target markets, and therefore your arguments for ecologically conscientious actions would be particularly well received. Periods after massive natural disasters, news about dangers to life from climate change, and holidays such as Day of the Dead and Memorial Day are examples.
     Interest in dying green could be considered as coming from a desire—seen most often in elderly consumers—to leave a legacy. Ironically, green behavior also is, at least from one perspective, wasteful and indulgent. Studies at Central Michigan University and National Dong Hwa University found that consumers believe cleaning products touted as being green are less effective than others, so the consumers use more of them for the equivalent task.
     Terror Management Theory says our realization we will someday die leads us to crave the promise of life in an afterworld and to us building legacies of children, fame, and fortune. One consumer motivation for buying products which are unnecessarily luxurious is to build enough self-esteem to protect against death anxiety. Research projects at Stanford University discovered that a protection against death anxiety is high self-esteem. The colloquial phrase “I was so embarrassed I could’ve died” reflects a relationship between threats to self-esteem and one’s demise. Similarly, when consumers experience life mastery, death anxiety is less likely to produce green behavior.

For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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Monday, December 3, 2018

Offer Service Pricing to Fit Idiosyncrasies

Consumers make choices based on the fairness of an item’s price and on how well the item fits the shopper’s idiosyncratic characteristics. University of Passau researchers looked at the juncture of these two as it applies to pricing for ongoing service usage plans, such as might be levied by a country club, community supported agriculture program, or mobile phone service.
     The researchers verified that people enjoy the perception that their pricing plan is personalized. The implication for service providers is to have a range of tariffs, each alternative described in terms of the characteristics of a target consumer. As examples, some of the tariffs offered or suggested might be flat fee for unlimited usage with a label of “Worry-free,” others pay-per-use with a label of “You’re in control,” and still others a barebones plus add-on options with a label of “Getting started.” 
     The feeling of price being right comes both from a sense of equity and a sense of personal fit. When it comes to ongoing services, the sense of personal fit is especially important because the shopper often lacks the ability to do comparative pricing, as would be done with merchandise, and is often unsure about the how much of the service they’ll end up using. A tariff attending to idiosyncrasies gives comfort in the face of the uncertainties.
     Supporting this interpretation, the researchers found that fitting service pricing plans to shopper idiosyncrasies added the most attractiveness in circumstances where shoppers lacked confidence, such as when the service was less familiar to the consumer. A range of other studies supports the interpretation that shopper attraction to idiosyncratic marketing comes from the ability to choose, not only from the better fit of these personalized alternatives. When a pricing plan was assigned to the customer by the seller based on an assessment of the customer’s particular characteristics, the relative appeal of the personalization faded.
     Researchers at University of Pittsburgh and University of Southern California note the evidence that labeling by shopper characteristics helps, beyond pricing, with the items themselves. They point out how Hertz formerly classified its cars by attributes—four-door, trucks, minivans, SUVs, then switched to classification with labels green traveler, adrenaline, and prestige.
     Researchers at University of Virginia found that the draw of customized discount coupons occurred even if the recipient didn’t use the coupons. People like to be recognized as individuals. Personalization in any form communicates caring.

For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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Monday, November 26, 2018

Guide Adolescent Eyes to Nutrition Information

We hope that as young consumers gain independence to make their own food choices, they select healthy alternatives. Researchers at Queens University Belfast and College of Agriculture, Food and Rural Enterprise-Loughry say this hope is too frequently dashed. Of the adolescents whose food choices were analyzed, more than half chose unhealthy items when left on their own, and almost one out of five made a series of choices dieticians would consider to be dangerous to the adolescent’s wellbeing. This occurred even with the adolescents who were knowledgeable about the importance of good nutrition.
     Some of the explanation for this resides in the rebellion and impulsivity of the adolescent mind. Additional explanation for the poor nutritional choices can be found in the difficulty adolescents encounter in spotting the nutritional information required for good choices. A total of 41 dieticians, teachers, and students in the fields of nutrition were asked by researchers at University of Manitoba to come to consensus about the most important competencies young consumers should master for healthy eating as those consumers transition to adulthood. Chief among the competencies the group specified was the ability to compare foods by interpreting labels and packaging. Yet knowing how to use it isn’t enough. Eye tracking studies by the U.S. Food and Drug Administration verify this.
     The FDA researchers asked 60 adult grocery shoppers to wear Tobii Pro eyeglasses which tracked their eye movements as they shopped in a grocery store for snacks, soup, and cereal. The researchers discovered how any interest in finding nutrition information on the package was challenged by the visual busyness of brand logos, product imagery, product claims, displayed prices, and promotional offers either on the product package or on adjacent signage.
     Attention to the nutrition information was higher when many alternatives within the product category included the data in a similar format. This was truer of the cereal category than the snack category. In addition, logos for nutrition grading systems, such as Facts Up Front® and Health Claims drew attention to the Nutrition Facts label.
     What’s true for adults is true for adolescents who are becoming adults. For both these, guide eyes to the nutrition information:
  • Favor brands which use a nutrition grading system logo on the package 
  • Position packages so that at least one for each alternative has the Nutrition Facts label facing the shopper 
  • On signage, say, “Check the Nutrition Facts on the label” 
For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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Monday, November 19, 2018

Tell Seniors to Get Out of Here

I realize that your surprise at what I’m about to tell you could easily lead to you replying, “Get out of here!” But it’s absolutely true, according to researchers at University of Queensland and University of Oxford: In the US, seniors account for fully 70% of all passengers on cruise ships and spend 74% more on travel and tourism than do those consumers between 18 and 49 years old. Senior tourism constitutes a prime opportunity for retailing profitability.
     So please change your meaning of “Get out of here” from signifying improbability to signifying an intention to urge seniors in your target markets to purchase travel and all the products and services which augment travel and tourism.
     Important to understand in doing this is that seniors, on the whole, have more disposable income, greater interest in using their money and time for experiences instead of material possessions, and more interest in physical activity than did seniors in the past. Considering that a substantial percentage of seniors are retired or semiretired, you’ve capabilities to fill off-season seats when marketing to this demographic due to scheduling flexibility. Because expected lifespan is increasing, your investments toward building repeat patronage are worthwhile.
     Research on senior tourism highlights the importance of appreciating the substantial heterogeneity in this market. With their longer life histories, a broader range of travel and tourism motivations are seen in seniors than in their younger counterparts. Still, there are marketing points likely to work across the segment. These include opportunities for social interaction, identity-building such as through nostalgia, and skill mastery.
     A “last chance to see” campaign can succeed because of seniors’ sensitivity to the limitations in years they have ahead of them. And although booking travel around the commitments of grandchildren can decrease scheduling flexibility, seniors are attracted to family experiences. Researchers at University of Colorado-Boulder, University of Virginia, Duke University, and University of Bologna report that consumers often operate on the assumption that they'll have more time in the future, but not necessarily more money. This doesn't mean at all that the consumers are satisfied to be wasting time. On the contrary, they want to feel in control of their time. To sell family-oriented experiences, advertise the benefits for shared enjoyment. And sell all-inclusive packages. Use the ocean cruise business model. Grandparents will get irritated with you if you require them to say no too often to a grandchild’s requests.

For your success: Retailer’s Edge: Boost Profits Using Shopper Psychology

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