Which of the following two options do you find scarier:
(A) Undergoing a potentially fatal surgical procedure that has a 95% survival rate, or
(B) Undergoing a potentially fatal surgical procedure that has a 1 in 20 death rate?
If you are like most people, you would find option B very worrisome and even though mathematically the two statements are the same, you would be inclined to pick (A).
Key point: Actually there are two:
Generally, use numbers rather than percentages (although there are some exceptions.)
Frame you proposition to customer in terms of ‘avoiding pain’ is more powerful (by a factor of 2) than by framing it as a gain or benefit.
Research: Kahneman & Taverski, 1991, Zweig, 2007, Hogan, 2002 and numerous others
How to apply to retail sales:
There are two basic strategies you can follow:
- Alpha strategies that emphasise the ‘gain’ for the customer
- Omega strategies that emphasise the ‘pain’ of non-compliance.
We wrote in a previous post how you could induce ‘scarcity’ to emphasise the pain of not buying. That is an OMEGA strategy.
1. These strategies work best when you couple the negative emotions (losing out) with specific behaviours to avoid the pain: “If you pay the deposit today, we can reserve this for you until you have are ready to make the full payment.”
2. You could also induce anticipated regret. IF the product is not scarce, you can still emphasise the ‘loss’ of the enjoyment and pleasure the customer COULD have had. Or emphasise how someone else regretted not buying.
3. Use numbers instead of percentages:
Good: 90% of our customers rate our service as “excellent”
Better: 9 out of 10 customers rate our service as “excellent”
4. Buy ONE get ONE FREE (BOGOF) is 150% more effective than 50% off.
(The above explanation has been adapted from on Sell$mart – The Applied Psychology of Shopfloor Sales.)
Remember: How you do ANYTHING is how you do EVERYTHING.