Here’s what goes on in your customer’s mind while buying your product...
A breakdown of the customer decision-making process.
Happy New Year!
After a much-needed 3 week break, I’m stoked to share Issue #5 of Market Curve. I spent these last 3 weeks thinking about what direction to take Market Curve in and here’s what I found:
I want to write essays that reflect the literature and thought processes of the leading psychologists, behavioral scientists and marketers. My goal with Market Curve is to offer you a different perspective on your marketing goals and to complement your existing marketing solutions abundant throughout the internet.
In order to do justice to you and to the people who have come before me, on whose shoulders I stand, I have decided to publish Market Curve on a weekly basis.
Thanks so much for subscribing, and please tell a few friends if you’d like!
— Shounak
Causality is a universal law of nature. Cause gives rise to effect. According to economist Alvin Roth, the economic world is no exception. Demand and supply gives rise to price determination. Psychologist Robert Cialdini had a special name for causality. He called them “fixed action patterns”.
Within the economic world itself, consumers have their own fixed action patterns - triggers that propel customers from passive onlookers into active purchasers. However, the path from the trigger to active purchasing is not linear. Google calls this path the messy middle.
The messy middle is where customers are won or lost as they sieve through the internal and external information barrage while making a purchasing decision. This includes internal perceptions and beliefs as well as external advertisements and marketing promotions. But what is the trigger leading us to the messy middle and what is its source?
The trigger is any thought or feeling based on needs, desires and deep-seated evolutionary appeals. It emanates from the 24*7 exposure all customers are subjected to. Copywriter John Caples believed there are only 3 triggers: (a) sex (b) greed and (c) fear. Once the trigger is activated, the customer enters the messy middle where they enter two main phases: (a) The exploratory phase and (b) the evaluation phase.
The first phase the customer enters is the exploratory phase - one that is expansive in nature. In the exploratory phase, consumers take conscious steps to find suitable offerings in the market. However, due to the vast amount of options available and their limited attention span, consumers often resort to shortcuts.
Decision-making heuristics are used to sieve through information that make it easier to make purchasing decisions. Behavioral Economist Daniel Kahnemann called this System 1 thinking - the one that operates automatically with minimal human intervention.
The reason for applying mental shortcuts by consumers in the messy middle is one that is rooted in biology and evolution - the principle of conservation of energy. It’s different from the CoE principle used in Physics. But only in part.
In Physics, the CoE states two things: (a) The total energy of an isolated system is constant and (b) Energy can neither be created nor destroyed but can only transform from one form to another. The CoE in decision-making makes use of part (a) of the definition used in Physics - one that is present throughout the animal kingdom.
For instance, predatory animals such as tigers will often assess the energy they spend versus the energy they will gain from killing and devouring their prey. If the return on energy is lower, the predator does not engage. Similarly, our brain has a finite amount of energy too and has such follows the law of conservation of energy.
With everyone vying for attention over the internet, customers (subconsciously) use heuristics to make fairly reasonable decisions without expending too much energy. There are 6 main heuristics: (a) category Heuristics (b) Power of now (c) Social Proof (d) Scarcity Research (e) Authority Bias and (f) Power of Free. In the exploration phase, this translates to browsing multiple websites and forums and using mental shortcuts to navigate. If we find it appealing, we engage with it. If not, we move on.
Once we’re done with the exploration phase, we move on to the evaluation phase. This is where we begin to delete options and close in on what we want. Our mental shortcuts come to our aid in this stage as well. For certain categories, the exploration and evaluation modes happen simultaneously with a lot of overlap between them. However, in cases of impulsive decisions, the exploration and evaluation stages are bypassed entirely.
At the end of the exploration phase is the final piece - the purchase of the product. As we can see, the journey is far from smooth. It’s complicated, unpredictable and messy.
Maybe this is why traditional marketing models tend to put user behaviour in fixed categories and attempt to translate subjectivity into objectivity. This started with the famous 1898 AIDA model right upto Google ZMOT.
What these models fail to understand is that customer journey and buying decisions are hardly linear with a whole host of factors weighing in to constitute the decision-making process. It would not be wrong to assume that traditional marketing models are a victim to the causal reductionism fallacy which states that:
Things rarely happen for just one reason. Outcomes result from many causes joining hands together. Our minds unfortunately cannot process such a complex arrangement. So we tend to ascribe outcomes to single causes reducing the web of causality to a mere thread.
Our existing marketing models are a good starting point to understand the nature of consumer behavior but that is what it is: a starting point - not the end goal.
References:
- Persuasion by Robert Cialdiani
- Who gets What, why and how by Alvin Roth
- Tested Advertising Methods by John Caples
Thank you so much for reading! If you want to get in touch, you can respond directly to this email or reach out on Twitter or Email. Always excited to meet like-minded humans!
Until next week!
— Shounak.