The Magic of Behavioral Marketing

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The Magic of Behavioral Marketing

Tenzin Gyatso a.k.a The 14th Dalai Lama once said: “Do not let the behavior of others destroy your inner peace”. Contemporary businesses have exploited behavior of their customers to such an extent that his holiness Dalai Lama would willingly reiterate saying: “Do not let your OWN behavior destroy your inner peace”. How often are we influenced in our daily lives to take a decision, right or wrong, knowingly or unknowingly? Each one of us react to a situation differently with a different mindset. The examples I’m taking below are the ones that are most commonly used to influence one’s behavior into purchasing a product.

Let’s say you’re purchasing an external hard drive on an E-commerce platform. You might come across the following choices as shown below:

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In the case (A), some prefer brand X for its capacity and some prefer brand Y for its price. Now let’s say a product Z is added to the option which is costlier than both X and Y but offers a storage space greater than Y but less than X. Now, the addition of brand Z which the consumers would presumably avoid, acts as a decoy that causes the sale of product X to be chosen more often than if only two choices were offered as shown in (A). Hence, this helps in boosting the sale of product X over Y. This strategy is employed by “The Economist” as well and is termed as the “Decoy Effect”.

When you book your flight tickets online, you often come across phrases such as “ONLY few seats left”. Or when you purchase any products online, you’re shown “deal EXPIRES in 10minutes”, “LIMITED stock “etc. Or when you go shopping you’re often bombarded with boards that read “SALE 50%ff”. We often refer to these words (Only, Limited, Expire, Sale etc) as Hot buttons which forces a consumer to take a spontaneous decision. This concept in the business world is referred to as “Fear of regret”. Our mind works in a way such that we are forced to take a decision on buying the product with the fear of having to pay a greater price for the same product in future.

Now suppose you’re seated at a café. How often do you notice the structure/shape of the glass or the size of the spoon/Fork provided to you? You would often find that the drinks served to you are in a slim tall glass which represents something like a blowhorn. What’s the necessity? Here is where the “Choice architecture” comes into picture. You are made to realize that the quantity of the drink served to you is a “LOT” whereas it’s hardly anything when measured in absolute quantity. So, what you’re served is nothing more than a legal deception.