Way back in 2012, I was struggling to figure out why someone I loved was making decisions that seemed to be in conflict with their best interest. I just couldn’t get my hands around that.
Of course, I know we all make impulsive decisions from time to time, as that Whatchamacallit box in the check out line at Publix can attest. “Yeah, yeah” when I go through the check out line it may get a little lighter.
“Why do we make choices counter to our own best interest?”
That question sent me down a rabbit hole of information, reading and researching our tendency for short-term thinking, impulsive behavior, and cognitive biases.
I read books like Richard Thaler’s, “Misbehaving: The Making of Behavioral Economics.” That lead to Dan Ariely’s, “Predictably Irrational, The Hidden Forces That Shape Our Decisions.” Then to Roger Dooly’s, “Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing.”
There were many others, but the last one “Brainfluence” really made me stop and think. As someone who works with clients to design and execute marketing campaigns and has a physics degree, the idea of applying neuroscience and cognitive science to marketing was both exciting and a little scary!
While most companies don’t include a research budget allowing them to test their messages on targeted individuals using functional magnetic resonance (fMRI) or Electroencephalography (EEG) technology they can learn from those that do. And isn’t “Imitation is the sincerest form of flattery” (thanks Oscar Wilde).
So what can we leverage from the research?
Here are some examples:
- How important color is to buying or attracting different audiences
Color is incredibly important in buying or attracting different audiences. Marketers use color to deliver quick visual messages. Studies have shown that 93% of customers say visual appearance is the most important factor, and 84% use color heavily in their decision-making. One study by the University of Loyola Marymount found that 90% of snap judgments were made based on color alone. Can you believe that color, not quality, was influential to 84% of people?
Want to do a deeper dive? Here is a great infographic if you want to see some additional research, How does Color Influence Customer Behavior?
- How too many options can create decision paralysis
Don’t overwhelm customers with too many options. People tend to experience decision paralysis when presented with too many choices. A study by Iyengar and Lepper found that when people were presented with a large number of jam samples, they bought less than those who were presented with fewer samples.
Interested in the study? This link, The Paradox of Choice: Do More Options Really Tank Conversions?, has a quick synopsis of the study, a link to the original study and additional info on the Paradox of Choice.
- How loss aversion affects buying decisions
This psychological phenomenon affects buying decisions. Individuals have a stronger emotional response to loss than they do to an equivalent gain, leading to a reluctance to take risks and choose “safer” options. A “money-back guarantee” or a “limited time offer” can help overcome this phenomenon.
“The concept of loss aversion is certainly the most significant contribution of psychology to behavioral economics.” – Daniel Kahneman “Thinking Fast and Slow”
If you are looking to learn more, I would suggest reading “Thinking Fast and Slow,” but it isn’t a quick read, it may be the biggest book I have ever read.
- How anchoring can help persuade our clients or customers
Everyone of experience the concept of anchoring in marketing. For example when you are looking at new car you always see the MSRP on the sticker. I am not sure anyone has ever paid or should have. And the same goes for the late night tv ad where you see that new incredible set of pots and pans made with a diamond coating and they tell you others sell similar products at $997, but you can get Bob’s set of 5 pots, pans and lids for not “$750,” not “$525,” but for “3 payments of $85.”
“Wow! What a deal!”
Well, probably not, but they want you to think that Bob’s pans are worth $255 because they anchored you to $977.
So watch out if you are a buyer or think about how you can use it to drive sales on your product or service.
I could go on, but I think you get the picture.
ps. If you were wondering, my loved one is doing much better.
Lynegar, S.S, & Lepper, M.R. (2000) When choice is demotivating: Can one desire too much of a good thing?. Journal of Personality and Social Psychology, 79(6) 995-1006