Thursday, September 23, 2010

Give Customers a Clear Sense of Progress

For many retailing activities, we’re asking the customer to go through a series of steps. With a frequent shopper program, the steps consist of the various award levels. With a technologically sophisticated product, the steps consist of learning how to use the different capabilities. With a process, such as the customer returning an item for refund or credit, the steps might include checking the receipt, obtaining approval from a manager, and so on.
     In each of these cases, give customers a clear sense of progress through the steps.
  • Sometimes we do this by making the steps big so that the customer easily recognizes change. Researchers at Virginia Polytechnic Institute and State University compared two versions of a loyalty rewards program in which a participant earned a 6% shopping discount after spending $100. In one version, the participant earned 10 points for each dollar spent and had to accumulate 1,000 points. In the other version, the participant earned one point for each dollar spent and had to accumulate 100 points. The researchers found that people felt more of a sense of progress with the “1,000 point” version because each step was associated with a bigger—and therefore more noticeable—number.
  • Sometimes, we make the steps smaller so that it seems easier to climb up the staircase. Researchers at University at Buffalo-SUNY and Indiana University evaluated different protocols for learning to use the capabilities of products like smart phones, Wii games, and digital cameras before deciding whether to purchase the item. Based on their results, they recommend having the learning divided into small steps, with the person given intensive hands-on trial periods at each step. This method produced the most user willingness to buy.
  • In almost all cases, we’ll want to give the consumer an overview of the steps at the start and then verify to the consumer when each step has been completed. More than eighty years ago, a Russian psychologist named Bluma Zeigarnik explored the reasons that waiters had a better memory for orders placed that were not served or not paid for than for those for which all the steps had been completed. Psychologists since then have used the term “Zeigarnik Effect” to refer to the mental itch we feel when a task is in limbo. Scratch that itch for your customers by announcing completion of each step along the way.
Click below for more:
Help Loyalty Program Members Progress
Turn Product Training into a Profit Center
Offer a Buffet of Loyalty Program Rewards
Tailor Loyalty Programs to Customer Culture
Give Loyalty Program Members Prestige
Have Suppliers Train Staff and Shoppers

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