The Choice Factory

Marketing is changing, and we are beginning to understand the psychological influences that affect consumer behaviour. No longer are we focusing on discount prices or bright colours. Here, James Smith outlines some of the key findings from Richard Shotton’s The Choice Factory – 25 behavioural biases that influence what we buy

I have long thought that the cycling industry is far too addicted to discounting, and I am as guilty as the next person. However, at the beginning of 2020, we began to focus on other areas at the JamesSmithGroup.

As a result, many of my clients have witnessed an increase in sales while simultaneously reducing discounting. The below excerpts are widely available, and I have selected just a handful of the very influential nudges. I hope that you find it as helpful as I did.

The Fundamental Attribution Error
The tendency to over attribute personality without considering the context. Contextual factors are more important than personality in determining behaviours, rather than focusing solely on the type of customer, also focus on the contextual factors.

Social Proof
You drive past a crowd, you crane your neck to see what they are looking at. You have just been influenced by social proof bias. Richard Shotton carried out an experiment with 300 respondents, showing them a fake beer brand telling them it was launching in the UK. Half were told the origin of the ingredients and half were told the same story but with additional information that it was South Africa’s most popular beer. In the second scenario, consumers were twice as likely to buy. Tell your customers how popular you are.

Distinctiveness
In a recent experiment, 500 participants were given a list of 15 numbers, all written in black except one number written in blue. Respondents were 30 times more likely to recall the number written in blue. In summary, when the world zig-zags…

Habit
A recent experiment showed that 45% of behaviour is habitual. Habits are contextual, therefore changing the context can loosen behaviours. Consumers are 21% more likely to change habits when they have undergone a life-changing event. Target customers who have undergone a life event like a birthday or a retirement. Get to know your consumers.

The pain of payment
A simple application of this effect is for brands to put more effort into prepaid cards, this is one step away from cash. Research proved that removing the dollar sign from price lists boosted sales by 7%. Next time you go out to a restaurant, take a look at the menu and make a note of the times you see the £ sign.

Mood
In a recent survey, 1,287 people were asked to flick through a newspaper and answer questions about which adverts they remembered. When the data was split by readers moods, those who were relaxed noticed 56% of adverts compared to just 36% who were stressed. Target your consumers when they are happy, for example, over the weekend – perhaps not so much at 9am on a Monday!

Expectancy Theory
In a recent study, Professor Brian Wansink of Cornell University created an experiment which gave out 175 brownies each with the same ingredients, even with the same powdery topping. The brownies were served in one of three ways, snow-white china, a paper plate and a napkin. The brownies rated “ok” when served on a napkin, those on a paper plate as “good” and those served on a white china paper plate as “excellent”. Even more interestingly, consumers were willing to pay twice as much for brownies served on a china plate. Context is everything.

This article is an abridged version of the study of the outcomes of behavioural influences and is published with the author’s full permission. www.jamessmithgroup.com