Consumer Behaviour

Firstly, thanks for all your comments, I find them encouraging, constructive and inspiring.

Secondly, Yann has raised another question.  Questions are wonderful things and, yet again, Yann has raised something that causes me to think about the subject of consumer behaviour (which I love to do) and given me a direction for this edition of my blog.

Yann asked whether our unconscious associations of brands are more influenced by broader environmental factors than advertising; things like what we hear (reputation).

Of course, there isn’t a single, clear-cut answer to this.  It is certainly the case that, were someone to hear an involving account (story) from a friend (social proof / trusted source / someone like me) this would trump an advertising message.  In this case, the powerful associations primed by the friend’s account work very similarly to negative personal experience: as soon as the brand name appears (be it at the start, middle or end of the ad) those established associations spring up and cause the person to dismiss what they’ve just seen.

By way of example, the UK furniture retailer MFI had a lousy reputation.  In fact, the first episode of a consumer rights TV programme Watchdog (in 1980) featured a complaint about the company that was handled extraordinarily badly by the poor store manager who was confronted by the BBC’s cameras.  I have never known anyone who had a problem with them, but I have been primed by the media to steer clear at all costs.  [MFI went under a few months ago.]

On the other hand, a lot of people don’t have an experience of a brand.  A lot of brands deal with superfluous elements of our lives.  Many of the things people tell us are not conveyed with sufficient emotion for us to assign unconscious significance to them (and so they are soon forgotten).

So humorous adverts, whilst inevitably failing to work on those already alienated, can create a positive emotional association for a brand.

Some brands have transformed their fortunes in exactly this way.  In the UK, Pizza Hut and Tango both experienced significant growth and profitability by taking brands that had lapsed into indifference and associating them with upbeat emotion.

When it comes to measurement of the unconscious impact of marketing (another of Yann’s questions) the only reliable way to evaluate is with a test and control methodology.  One area gets one set of unconscious associations the other doesn’t; or for a period you try one way, and later you try another.

With large brands it’s easier to do the former; it’s also important to consider the potential timescales involved.  Advertising that creates a more positive image of a brand in the way I’ve described might not produce immediate sales success; but it may still have an impact.

The key here is to adopt a strategy and persist with it for long enough for consumers to be influenced.  This is a by-product not just of the opportunity to be exposed to the communication sufficiently frequently, but also of the incidence with which they come into potential purchase contact with the brand.  If purchase frequency is low the campaign would have to be sustained without becoming irritating.  Of course, if a more motivating proposition appears on the scene from a competitor this can further muddy the waters.

Good marketing needs to be consistent at all the points it comes into contact with consumers.  The attractiveness of TV advertising (when it’s understood and applied correctly) lies in the opportunity to create emotion and associate the brand with it:  for a few seconds, the brand has full control of the consumer’s environment.

Philip Graves

Philip Graves Advertising Advertising, analysis, psychology, why customers buy

I’d like to pick up on a long reply to yesterday’s post because I hope I can be more constructive than I was able to be yesterday.

Here’s is Pam’s reply to yesterday’s post:

It’s interesting to read how the rational and unconscious minds often pull us in opposite directions. Your point is well taken that people often think they want A but actually choose B because it fulfills an unconscious need, want or desire. It is good to bear this in mind.

If you are looking to invest your money though, at some point – unless you choose to navigate the investment world yourself – you will likely be forced to make a choice between various options and advisers available to you. In essence, you are trusting your future to advice of someone and their investing philosophy and strategy.

The question then becomes in whom do you trust and why do you trust them?

As you have been explaining so well in your blog, our buying decisions must fulfill some type of psychological need. In the case of investing, one must feel comfortable entrusting their life savings.

For some it is purely an emotional investment. They will invest with the person who makes them feel most comfortable or represents a philosophy they feel most comfortable with.

For others, such as myself, our comfort-zone is found by analyzing details and facts. Rod’s approach will likely not persuade the masses. Nor does he intend it to. It’s a targeted niche of investors to whom his strategy will appeal. He knows and understands the demographics of those whom he is targeting.

I have seen first-hand the results Rod’s methods of investing. The process through which he takes his clients is thorough, rigorous and intense. I can speak to this through personal experience as I am one of his numerous clients. And yes, even I had to go through the same battery of tools he uses to devise a plan tailored and targeted specifically to my risk tolerance and time horizon – which I might add is different than the risk tolerance of us as a couple. I would be remiss if I didn’t add that while the market has taken a hit in recent months, my portfolio has weathered the storm quite nicely given the current economic conditions.

Everyone has to find their own comfort level – after all its YOUR money and YOUR future that you are banking on. While past performance is not a predictor of future earnings or performance, I know where my comfort-level is an I’m very happy with the results I’ve achieved through Rod’s methodology and strategic investing.

Thanks for your time and consideration.

Respectfully,

Pam
Well the first thing I’d like to say is that I’m sorry if Pam took it as an indirect attack on her and Rod’s business, it certainly wasn’t intended to be.

Secondly, Pam’s reply didn’d address the key point of the research I was reporting: it was investment advisers whose judgment was influenced (primed) by what they had just read, although no doubt consumers are susceptible to being primed in the same way.

So how could someone in the investment business use research like that which I referenced, which opens a veritable can of worms regarding the veracity of investment advice?

From the point of view of the investment advice they offer, other research on subliminal influence and priming shows that its effects are reduced, or removed altogether, where people are aware that something could prime them.  So, provided Rod recognises that he could be unconsciously primed to give different advice on the basis of what they read and hear, they are somewhat less likely to do so.

[Incidentally, I'm certain that none of the very rational and analytical investment advisers and accountants that took part in the research believed their advice was the by-product of something they'd just read.  This isn't a reflection on the individual, it's a reflection of how our brains work.]

Perhaps more importantly this information is an opportunity for them to differentiate from their competitors.  In their position this is exactly the sort of information I would communicate to potential clients, along with an overview of the systems in place to make the advice offered as rational and robust as possible (something that seems to be a real strength of theirs).

Rest assured, there is nothing like providing a genuine source of anxiety in your consumer’s mind regarding the risk of using a competitor, for that competitor to seem far less attractive.  Handled the wrong way knocking the competition can be alienating, but when you have scientific studies to quote it’s not you that’s doing the knocking, it’s implicit (or explicit if you point out that “very few other investment specialists are aware of the fact that…”).

I hope that this makes for a more constructive post. 

Philip Graves

Philip Graves consumer behaviour, selling Add new tag, analysis, consumer behaviour, marketing communication, priming, psychology

Perhaps some of the most interesting blog debate I’ve read recently has been on Rod’s Personal Investment Strategies blog. 

It’s been a while since I did any consumer behaviour research with financial institutions, but in many ways my journey into consumer behaviour and away from traditional consumer research began during a consumer focus group about pension choice, back in the 1990s. 

It was the fourth long and tedious group discussion with people who were considering investing in a pension scheme, during which they told me how they wanted independent advice, a range of funds and a provider with good financial security.  At the end, after everyone was getting up to go, one of the group asked another, who had been a little more vociferous than the rest, where he was planning to get his pension.  The reply led to several of the group soliciting the details of someone who I recognised was an ‘industrial’ insurance salesman (i.e. not independent).  What’s more, they didn’t ask who he represented, how financially secure his company was or how many funds he offered.

I realised that I was going away to write my report on what they’d all said; meanwhile they were all about go and do something entirely different.

I’m aware of studies that have found people tend to like stocks that have readable names (as opposed to abstract or technical-sounding ones), and that people tend to select things in general that begin with the same first letter as their own name. 

These reflect the way the unconscious mind works, by generating a feeling based on familiarity, which is then consciously de-coded (erroneously) as being a ‘good’ choice.

Last week another study shed light on the power of the unconscious mind’s influence in this apparently rational world: a study conducted by the University of Haifa found that the investment selections of a group of investment advisers and accountants  was strongly influenced by what type of article they were given to read before making a selection.

Those who were given an article on someone who took big risks and was successful, rated a stock they were shown as being more attractive (more valuable for investment) than those who were shown the same stock after reading an article about someone who had been successful after avoiding a risky decision.

All the participants gave their assessment of the fund on the basis of the same financial report.

So it seems an investment advisers advice might have just as much to do with what he’s read that morning in the paper, or a story he has heard from someone else, as it does a ‘rational’ assessment of the data for that company.

Studies like these on the power of priming don’t make for particularly comfortable reading for anyone who likes to believe they’re balanced, rational and analytically-minded.  However, understanding the way our brains work is critical to understanding our customers’ behaviour.

Philip Graves

Source: University of Haifa (2009, April 28). Reading Reports Involving Risk-taking Affects Financial Decision Making. ScienceDaily.

Philip Graves consumer behaviour, selling analysis, consumer behaviour, investments, priming, psychology

I enjoy watching myself as a consumer, in that slightly schizophrenic way that I encourage everyone interested in understanding customers better to do.  If you have the right framework you can learn a lot about the way in which other people make decisions by watching how you make a decision – after all, you’re a person aren’t you?

The challenge is always to split out that part of you that consciously post-rationalises what you do in a totally bogus way.   If you can learn to tell yourself that, deep down, you’re smart, sexy, clever and incredibly good at parking a car, you can put your ego to one side for a few minutes and observe what you’re doing as a consumer. 

You’ll have a reasonable idea that you’re on the right track when you spot yourself doing things that are  impulsive, irrational, poorly judged and altogether a bit dumb.

Recently, I had to choose between two suppliers for a fairly major contract.  Both put in a huge amount of work to provide their quotes and I felt both would have been excellent solutions for my needs.  But I could only choose one.

So I thought I would give as considered a response as possible to the firm that I wasn’t choosing, in the hope it would help them.

I’ve included it below.

Thank you for visiting me yesterday and providing the above quote in such a timely fashion.

I’m writing to inform you that I have decided to use another company.  The decision was incredibly hard and made all the more difficult by the fact that the specifications suggested by the companies I spoke to differed substantially, making a simple price comparison impossible (not that it was ever solely a matter of price). 

In your position I would be keen to understand why I had not been chosen over a competitor.  In this case it was a matter of finding it almost impossible to make a choice, opting to speak to the firm that I had spoken to first to try and resolve the best route forward and, as a result of that conversation, opting to go with the person who was giving me advice at that time.   

During the conversation I was better able to understand the reasons for them recommending the unit they had (a slightly higher specification), was able to appreciate the benefit of features they suggested, and they agreed to add in an additional item.  I was happier with the idea of a wired system over a wireless one (given wireless problems we’ve experienced in the past), and they remembered from their visit that the necessary cabling could be routed quite easily. 

Of course these differences are changes that could easily be incorporated into your own quote. However, as a consumer there comes a point where the complexities involved risk one never making a decision, and at some point it becomes necessary to “jump in” even though you know that you don’t have perfect data.   

I was hugely impressed by your company’s professionalism and, as you’re no doubt aware from your commercial success, my selection of a competitor was no reflection on your approach.

Thank you again for supplying me with a quote

Philip Graves

Philip Graves consumer behaviour analysis, choice, consumer behaviour, why customers buy

You’d be hard pressed to find any marketing text book that doesn’t talk at some point about “consumer need”.

It’s a simple enough concept: the products that will do best are those that meet a requirement that someone has.

At the next level you may find there’s a discussion on the types of consumer need.  Broadly these break down into physical and emotional needs. 

So, by way of simplistic example, the former says that, because you’re cold you will buy a hat.  The latter that because you want to feel special you’ll buy an expensive hat. 

This is all fine up to a  point.  But I happen to think that most consumer behaviour is nothing to do with “need”.  This is a problem because the notion of consumer need suggests that, at some level, a consumer is aware of what it is they are getting as a result of acquiring the product, and in my experience that’s often not the case.

Have you ever noticed how much some people’s lives are taken up with shopping; for some people human behaviour is consumer behaviour, almost exclusively.  When they aren’t shopping, they’re thinking about shopping, or watching TV programmes surrounded by ads, or reading magazines that are promoting consumerism directly through their copy or indirectly through their adverts. 

And some people will talk about shopping for hours; granted they’re not talking about the physical act of buying, they’re talking about something they’re thinking about buying, or something they’ve bought, or what happened when they tried to buy something.

All of this is has precious little to do with how cold someone’s head is.

I suspect that we’re collectively so preoccupied with shopping because of how our brains work.  Studies show that the brain works by estimating risk and reward, and then sending out extra dopamine (the feel good factor) when a decision is proved correct.  This increases the strength of the the neural pathway, essentially increasing our perception that what we thought would happen did.

I won’t explore the many fascinating implications of this mechanisms now, but when it comes to shopping I suspect it’s so prevalent because it’s so predictably rewarding.

Most of the time when you go out to buy you successfully do so.  The process is completed and you now own something new.  Owning stuff feels nice.  In fact, studies like the one I talked about recently in my eZine (The Importance of Touch) show that we get very attached to things we hold very quickly.

In evolutionary terms it’s generally been advantageous for us to have stuff: stored provisions, items we can use as tools, things we can defend ourselves with, mechanisms for protecting ourselves from the elements and so on.  So our brains have evolved to reward us for having things.

Rarely is shopping disappointing or dissatisfying.  When it is we learn quickly to change our expectations or to avoid places that fail to satisfy, and we can quickly find substitutes.

In essence shopping is low risk, high reward behaviour, and our brains get a kick out of that.

Philip Graves
P.S. You can sign up for my eZine here.

Philip Graves consumer behaviour, consumer research analysis, articles, consumer behaviour, consumer research, psychology, why customers buy

Having suggested that perception is far more important that the reality of experience in determining consumer behaviour, you might think that finding out how a consumer perceives your brand is a useful exercise.

And, of course, you’d be right.

You might suggest, therefore, that asking a sample of your target consumer audience or existing customers would be a smart think to do.

And you’d be a lot less right.  In fact, if you don’t mind me saying so, you’d be wrong.

There are a number of reasons for this.

Firstly, we aren’t always aware of our perceptions.  A lot of our reactions happen at an unconscious, emotional level.  We like to believe we’re wonderfully good at decoding this responses consciously and post-rationalising them accurately, but we really aren’t.  We just make it up and then convince ourselves that what we’ve just told ourselves is true.

This is what I call “the what we like to tell ourselves” error.

In general, we’ll tell ourselves that we’re smarter, sexier, funnier and all round better than we really are.  We’ll also tell ourselves that we’re not in the snare of any silly old brand, it’s just that we’ve happened to find their products are better suited to our needs.

Secondly is the problem of how we think our answer will be perceived by someone else; we’ve learned through the “mistakes” of childhood not to say what we’re thinking but screen it for social acceptability. 

Kids are wonderfully honest and direct: I remember my two-year-old son staring at a man in the doctor’s waiting room and asking very loudly, “Why has that man drawn all over himself?”  The tattooed man didn’t take exception and it was, I think, a very good question to ask (although not one I would except to get an accurate answer to from the chap himself!).  By the age of six my son has enough of a developed sense of social awareness not to ask that sort of question in public.

This filtering process becomes automatic and gives us the “what might they think if I told them” error.

Most people don’t want to be seen as being influenced by brands and advertising even when they’ve fallen for a brand hook, line and sinker.  Even when they are aware they’re very loyal to a brand they probably wouldn’t want to acknowledge the full extent of it’s impact on what they do (even if they are aware of it).

Last, but not least, the actual process of asking someone a question changes the way they think and, therefore, how they respond.  I won’t go into all the psychological nuances of this now, but suffice it to say there’s a reason that psychotherapy makes such extensive use of balanced questions to bring about change.

So, whilst customers’ perceptions are deeply significant in determining their behaviour, asking them about those perceptions isn’t likely to reveal the nature or extent of them reliably.

Next time, if you haven’t guessed already, I’ll tell you how you can understand this aspect of consumer behaviour better.

Philip Graves

Philip Graves consumer behaviour, consumer research analysis, articles, buying behaviour, consumer behaviour, consumer research, why customers buy

I read recently that a study has found that we don’t see things all the time. Brain activity has peaks and troughs (about ten per second) and when it’s in a trough we don’t see.

Then there is inattentional blindness.

You know, the thing that happens when a man in a monkey suit walks across a two-ball basketball counting game (it happens all the time, but people fail to see monkey-man because they’re so busy counting the number of passes).

And then there’s the problem that my wife can’t find her keys or her phone or her address book (often her address book).

Because I understand the psychology of looking at stuff I know that her strategy is a reckless one. It’s no good putting stuff down any old place and relying on your eyes to find it when you start looking. You might momentarily have your attention elsewhere, or be in one of those brain activity dips when you happen to walk past it.

Then you get cross because you can’t find it and, when someone else points out where it is, you get even more cross because you’d looked there.

So I always put the things I might lose in the same place. I always know where they are. [One other option is to attach everything you own to a piece of string; that way you always know where it is... on the string.]

What has all this got to do with consumers? Well, when we do something in our business we see it. We know it’s there because we thought about it.

But that’s no guarantee that your customers will see it.

So one of the most important skills in understanding consumers is to recognise that they don’t see your world and your products in the way you do. If you have a physical shop it is really useful to stand back and watch where they look and, in particular, where there attention lingers.

If you only sell on-line there are only two things you can do:

1. Learn how consumers’ minds work and what influences them (I wrote my EBook The Secret of Selling to help with this).
2. Trial different approaches to how you present your information and measure the response.

Now, if I could only find my keys, I’d go to the bank like I’ve been meaning to for three days.

Philip Graves

Philip Graves consumer behaviour analysis, consumer behaviour, influence, marketing communication, psychology, selling, The Secret of Selling

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Every so often I take an advertisement, usually from TV, and analyse it from a consumer perspective.

What I’m interested in is the way in which the advert is likely to work at an unconscious level, since I’m convinced that this is most important dimension for marketing communication of this kind.

Now that presents it’s own particular problem, because it’s generally acknowledged that we have no direct link between our unconscious and conscious minds.  The unconscious triggers various feelings, which our conscious mind then receives and attempts to decode into some kind of rational explanation: “I feel bad, I must not like what I’m looking at.” 

Unfortunately there’s lots of evidence to show that we’re quite bad at evaluating these feelings accurately (which is one of the reasons that consumer research has so much potential to be misleading).

By applying models of how people think and developing my own split personality I keep a trained eye on my own unconscious reaction to the adverts I encounter and then set about trying to decode what it is that does or doesn’t work about what I’ve seen.

How effective is this?  Well, you can decide for yourself if you take a quick hop over to my home page and look at one or more of the articles at the top left, headed Advertising Reviews: the most recent is called “A Bad Ad in a Good Cause“.

Please do drop back over here and let me know what you think.  Advertising is a notoriously subjective issue, but I’m working on ways to remove that subjectivity; I’m interested to know if you think I’ve achieved that.

Philip

Philip Graves Advertising Advertising, analysis, consumer behaviour, marketing communication, TV