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- How customer decisions are influenced
In our lives, we keep on facing the need to choose. From big life decisions to small everyday choices, we use the processes in our minds to arrive at something we call our decision. These processes are cognitive so people are not usually impulsive but are using the built-in processes to make decisions. The people who are spending money, they certainly pause to think rather than being impulsive.
A common idea about making a choice is whether you are making the right choice or not considering it an absolute thing. Here is the surprising fact, our mind has no ability to recognize something absolutely right or wrong. It’s some criteria that are set in as pretext on the basis of what your mind relates.
Let’s take a common example to explain how it’s working. You probably have heard of cost and benefit comparison towards net gain. If the gain is more important for you than the cost, your mind tells you to go for it and makes you feel right. Here is how net gain criteria work.
Similarly, people tend to compare products to decide what to choose. Because they want to find criteria. So, if given more choices, they find more measures to reject things and are more likely to abandon buying.
Consider two dictionaries:
Dictionary A— 10,000 entries. Like New.
Dictionary B— 20,000 entries. Good condition.
Customers offered a higher price for Dictionary A when it was the only option. However, when it was next to Dictionary B, they preferred Dictionary B
Evaluating options is hard. How many entries should a dictionary contain? 10,000? 20,000?
Adjacent options become that comparison. Our choices are influenced by the comparison of options, rather than the pure “rational” motive.
Understanding the above, we can arrive at these marketing strategies,