Tag Archives: value

How Scarcity Can Influence Buying Behavior

Editor’s Note: This
essay is adapted from Hooked:
A Guide to Building Habit Forming Products
 by Nir Eyal. Nir also blogs
at NirAndFar.com.

There are many counterintuitive and surprising ways
companies can boost users’ motivation to buy by understanding heuristics ‘ the
mental shortcuts we take to make decisions and form opinions. Even though users
are often unaware of these influences on their behavior, heuristics can predict their actions.  
In 1975, researchers Worchel, Lee, and Adewole wanted to
know how people would value cookies in two identical glass jars.[1] One jar
held ten cookies while the other contained just two stragglers. Which cookies
would people value more? 
While the cookies and jars were identical, participants
valued the ones in the near-empty jar more highly. The appearance of scarcity
affected their perception of value. 
There are many theories as to why this is the case. For one,
scarcity may signal something about the product. If there are fewer of an item,
the thinking goes, it might be because other people know something you don’t.
Namely, that the cookies in the almost-empty jar are the better choice. The jar
with just two cookies left in it conveys valuable, albeit irrelevant,
information since the cookies are identical. Yet, the perception of scarcity
changed their perceived value. 
In the second part of their experiment, the researchers
wanted to know what would happen to the perception of the value of the cookies
if they suddenly became scarce or abundant. Groups of study participants were
given jars with either two cookies or ten. Then, the people in the group with
ten cookies suddenly had eight taken away. Conversely, those with only two
cookies had eight new cookies added to their jars. How would these changes
affect the way participants valued the cookies? 
Results remained consistent with the scarcity heuristic. The
group left with only two cookies rated them to be more valuable, while those
experiencing sudden abundance by going from two to ten, actually valued the
cookies less. In fact, they valued the cookies even lower than people who had
started with ten cookies to begin with. The study showed that a product can
decrease in perceived value if it starts off as scarce and becomes
abundant. 
For an example of how perception of a limited supply can
increase sales, look no further than Amazon.com. My recent search for a DVD
revealed there were ‘only 14 left in stock,’ while a search for a book I’ve had
my eye on says only three copies remain. Is the world’s largest online retailer
almost sold out of nearly everything I want to buy or are they using the
scarcity heuristic to influence my buying behavior?
You can hear Nir
speak at the upcoming Future of Consumer Intelligence Conference 2014 in Los
Angeles, California.  The Future of Consumer Intelligence 2014
explores the emerging role of decision science and the convergence of knowledge
points – insights, foresights, social science, marketing science and
intelligence with technology as a central driving force and profound connector.
For more information on the event, click here to download the interactive
brochure: http://bit.ly/1qzXDjP
Register for FOCI and
see Nir in person! http://bit.ly/1p43bWl
[1] Worchel, Stephen,
Jerry Lee, and Akanbi Adewole. ‘Effects of Supply and Demand on Ratings of
Object Value.’ Journal of Personality and Social Psychology 32, no. 5 (1975):
906′ 914. doi: 10.1037/ 0022-3514.32.5.906
.

Creating Value For Your Customers Through Mobile

If there’s one consistent theme that we hear when it comes to mobile, it’s that unwanted mobile marketing can feel intrusive, or be viewed as spam, whereas the right mobile content at the right time can be extremely effective. When you are providing real value to your customers through your mobile content it builds loyalty and engagement.

The HealtheHorizons’ visioncheck app, which is available free on iTunes right now, is a perfect example of providing such value. As part of Allergan’s HealtheHorizons’ wellness programs, the app is a unique application for screening three common eye diseases in diabetics. Targeted at active individuals with limited time and desire to see a doctor, the app provides quick, useful vision tests, and more information on common questions and concerns, it also further encourages one to contact an eye care professional. This video explains further:

Mark S. Miller, Director of Marketing ‘ Channel Strategy, Allergan , Inc. will be speaking on this topic more at the upcoming Mobile Marketing Conference in Miami.

At his session, you’ll learn:
‘ How Allergan leveraged apps and tablets to build disease awareness and education
‘ Key drivers impacting consumer decisions
‘ How mobile can save time and money

Save 15% when you register with code TMMC12DIGITAL here.

P.S. Join our social media community! Our new LinkedIn Group is a place to share expertise and brilliant ideas on anything mobile marketing and you can also follow us on Twitter or on Facebook for conference updates and industry insider news.

Positive Customer Experiences

It’s important that your customers have a great experience at every touch point when they are doing business with you. Colleen Frances recently posted her tips for creating the best customer service at all the touch points throughout your customer experience. 1. Love what you sell, the company you work for and the customers you serve. If you show the customer you truly love what you do and what you’re selling, they’ll have a good experience buying the product from you.
2. Be empathetic and compassionate. Know and believe exactly what you’re telling them. Take an interest in the people asking the questions.
3. Add value and give first. Give them something before they buy from you. Show them that they can trust you, and you’re worth more to them than the profit. It may be a dentist or a new business contact, but they’ll see your purpose.
4. Make eye contact. It’s difficult to do, and many other sales people fall short. But if confidence is shown through making eye contact, you’ll truly set yourself apart from your competition.
5. Express your true intent. Don’t fake it, tell your customers your true intentions. Let them know that this might not be the right solution for them, but you’re going to try to show them how your product can fit your needs.
6. Don’t go for the big decision all at once. Don’t try to land the big deal on the first try. Gradually move there through a series of conversations, agree on a second or third meeting.
7. Use friendly, warm words. Speak on a friendly level. Limit your syllables and use simple words.
8. Use people’s names. Use their names, however, be aware of their comfort level with the name you’re calling them. Do you use their first name, or their title and last name? With the correct name, it’ll make a memorable experience for the customer.
9. Ask the right questions. The right questions can lead to positive relationships. They can also reveal the problem that needs to be solved and build trust between the company and the client.