Consumer psychology: Why do you end up buying the products you buy?

Everyday, you and millions of other potential consumers make thousands of decisions. You are not consciously aware of most of the decisions you make, but you make most of them the same way, by reflecting on the drawbacks involved, and then picking that course of action with the fewest drawbacks (or the least painful ones).

Herbert Simon, a Nobel Prize winning economist, referred to this as “satisficing.” Instead of optimizing satisfaction, and choosing an outstanding product in terms of its aspects in one particular area, we compromise on the best so that we do not get the worst in some other aspect. We don’t settle for the best in one area, but the least bad in all areas. This article provides you with useful information on how customers make their decisions. Take a look!

Why decision making is all about exclusion

The only way to understand how consumers make decisions is that they do not accentuate the “positive,” but the “negative.” The process of making a decision is not about including more options and facets, but about exclusion. The analogy is one of a funnel with a lot of screens and filters inside: a lot may be poured in at the top, but only a small amount makes it all the way through to the end point (the decision by the consumer to purchase the product).

How did you vote in the last election? Did you really think the candidate who got your vote was the best possible person to represent you on national and international affairs? The best that your party could offer? Did you wish someone else had been running? Most voters do not think of themselves as voting “for” either candidate, but as voting “against” the other, choosing the lesser of two evils. Indeed, campaign research indicates that the most effective ads tend to be the hit pieces that attack an opponent.

People are constantly modifying their decisions

Decision making is not an event, with a beginning and a conclusion, but an ongoing process. It never really ends. It achieves some working points that serve as the foundation for action, but it is never really over. According to Payne, Bettman, and Johnson, authors of The Adaptive Decision Maker, people are constantly modifying their criteria in light of past decisions and present realities.

The process continues not just because new facts and alternatives present themselves, but because the priorities of consumers keep shifting. Remember that Mazda Miata you bought when you were 18? Now you are buying a minivan. The facts about the Miata and the Minivan have not changed, but after two kids, your priorities sure have, and that means that your perceptions of problems have changed.

Why risk adversity can lead to even higher risks

The rejection mindset of consumers has been attributed to various factors. Psychologist Julie K. Norem in The Positive Power of Negative Thinking looked at pessimism, obsessive worry, lowered expectations, even the prevalence of the Murphy’s Law delusion as psychological defense mechanisms.

Clearly, people are risk averse, and many risks are given exaggerated importance. People are concerned about the dangers of airline crashes, yet per passenger mile it remains one of the safest modes of transportation around. Indeed, most people have a greater risk of fatal accident driving to and from the airport than they do flying to their destination. It has even been estimated that when the terrorists frightened potential travelers in the wake of 9-11, another three thousand people died on the nation’s highways trying to avoid the “risky” skies.

To be less depressed, embrace satisficing

Overall, however, using perceptions of the unfavorables to satisfice is quite consistent with mental health. Barry Schwartz in The Paradox of Choice: why more is less noted that the alternative to satisficing is to constantly attempt to maximize, and be unsatisfied with any product or service that is not perfect on all accounts. This leads to dissatisfaction. “The drawbacks of maximizing are so profound, and the benefits so tenuous that we may well ask why anyone would pursue such a strategy.” To be less depressed, embrace satisficing.

Another distorted perception on present choices would be the past. Those things carrying the most weight are not part experiences, but previous decisions. It is the latter, more so than the former, that frame the present decisions with excess baggage.

Customers don’t want to admit that they were wrong

People do not want to admit that they were wrong in the past, and therefore tend to perpetuate previous decisions, wise or not. People might follow a losing stock until the company is bankrupt because they don’t want to admit that they were wrong not to sell previously (or admit that they were wrong to buy it in the first place).

The process of decision making never ends, but people do get tired of the process and want to call a temporary halt. When the customer says that he needs to think it over, he just needs some time to stop thinking. He has pretty much excluded your product, or at least finds that its further consideration is bothersome. You could ask him just what is it that he needs to think over, but that would presume that he is going to use the near future to gather relevant information (which he is not). In certain contexts “I’ll wait” or “Let me think about it” or “I’ll be back” is but a social courtesy, a euphemism for “No, and I don’t want to stay here and argue about it.” In other contexts, the customer leaves with a sincere intention to give the product further consideration, but a failure of memory or other unforeseen future factors prevent the purchase.

There is a lot more you can learn about customers’ decision making. If you are interested in gaining further free insights into this topic, then the eBook “Buzz or Zap? – Consumer psychology for the 21st century” written by T. L. Brink is for you.