Practical behavioural science's role in CX
Take a look on jobs boards and you will see many large brands recruiting behavioural data scientists. Why?
Cognitive biases and heuristics heavily influence our judgements and decisions outside of our awareness. And an understanding of a few cognitive biases and heuristics that dictate consumers decisions and communicates how this understanding can be leveraged to build brands.
One main way in which heuristics and biases influence our day-to-day life is by shaping our perceptions. An example of such a kind of bias is the availability heuristic, which explains our inclination to base our perceptions on information that comes to mind quickly and easily.
Brands like Walmart and No Frills have used the availability heuristic to their advantage. They have associated their brand identity with large price rollbacks and discounts, which leads the retailers to come to mind quickly when customers think about low-priced items. Even though some of their items might be more expensive than their competitors, customers connect these retailers with large price discounts.
Cognitive heuristics and biases also shape our evaluations. An example of this is the affect heuristic, which suggests that we heavily rely on our emotions to evaluate items rather than consciously weighing risks and benefits, particularly when decisions are made under time pressure. In other words, the question of what you think about a particular product is simply replaced with how you feel about that product.
Apple uses this heuristic to create a strong, positive brand image by advertising its benefits, such as durability, quality, and usability. Therefore, people who think positively about Apple are willing to spend more to buy new innovations without considering the individual risks and benefits. Other examples of biases that may shape our evaluations are in-group favoritism and the pratfall effect, which we discuss in more detail below.
What should brands do?
Brands can capitalise on these cognitive biases, among others, to align their marketing strategy with customers attitudes and behavior. Here are certain strategies that brands can use to appeal to customers:
- Identify Your Brand Assets: The availability heuristic explains how easily available information is considered more common. So, for brands to leverage this, they must ensure their brand assets are on-brand (i.e., aligned with their brand equity) and easily recognized as owned by the brand.. For example, the iconic Apple logo represents the greatest asset of the brand. This creates a distinctive memory in customers’ minds about the product; it comes easily to mind whenever they see that logo.
- Using Testimonials: Brands should put testimonials on their product site. While providing social proof to customers, these testimonials also tap into the affect heuristic. This can increase the perception of benefits and reduce the perception of risks, leading people to become more inclined to buy that product.
- Us vs. Them: In-group favoritism is a mental shortcut by which we favor people that we consider a part of our own social group more than those who fall outside our social group. Several brands leverage this heuristic to differentiate their brand from their competitors. They highlight the benefits of their brand and the shortcomings of their competitors. A great example of this is Apple's previous “I am Mac, I am a PC” advertisements. More recently, McDonald’s popularised their McCafe coffee by parodying hipster coffee culture and people who buy expensive/fancy coffees.
- Admitting Weakness/Mistakes: The pratfall effect humanizes celebrities and brands by making them more relatable. The pratfall effect is a tendency to increase or decrease someone’s attractiveness level after making a mistake. Like people, brands are not flawless - they make mistakes. Recognizing their mistakes and shortcomings can improve the brand image. Several brands have used their shortcomings to their advantage. A classic example of this is Tesla's Cyber Truck mishap. Tesla claimed that their new Cyber Truck is bulletproof, but the window unexpectedly broke when a ball of steel was thrown during the testing. Elon Musk took to Twitter and laughed at this mishap. In fact, the video went viral and made customers more interested in the truck.
- Align Speech and Visual: According to the principle of cross modal correspondences, the human mind relates speech sounds and visual objects. This is another way that our perceptions can be impacted by cognitive processes. For example, the sound of “Pampers” is associated with softness, comfort, and nurturing. The blue color represents calmness, and the logo of a rounded heart creates a soothing and soft image in the customer’s mind, therefore, perfect for babies.
Cognitive biases impact judgements and subsequent human decision-making abilities. Brands can rethink customer behavior to improve their brand image, increase their sales, and build their brand. This will improve efficiency and lessen the marketing effort by aligning to how customers truly behave. If used at the right time and in the right context, they will help you understand your customer and boost sales.
Finucane, M.L., Alhakami, A., Slovic, P. and Johnson, S.M. (2000), The Affect Heuristic in Judgments of Risks and Benefits. J. Behav. Decis. Making, 13: 1-17.
Kahneman, D. (2011). Thinking, Fast and Slow. Farrar, Straus and Giroux.
Kahneman, D. & Tversky, A. (1973). Availability: A Heuristic for Judging Frequency and Probability. Cognitive psychology, 5, 207-232.
Ofir, C., Raghubir, P., Brosh, G., Monroe, K. B., & Heiman, A. (2008). Memory-Based Store Price Judgments: The Role of Knowledge and Shopping Experience. Journal of retailing, 84, 414-423.