Serendipity 3, an exclusive New York restaurant, is well-known for its outrageously priced $69 “haute dogs” and $1,000 ice cream sundaes. However when this haute dog was launched, the sales of its $17.95 hot dog went through the roof. The tactic revealed human cognitive bias: the expensive hot dog played the role of a decoy for price relativity.
THE SCARCITY EFFECT
This scarcity effect creates the sense of exclusivity that many brands covet. Burberry is known to have burned unsold items to “protect its brand”. Starbucks’ Unicorn Frappuccino claimed to be available only for a few days on its website: it garnered 160,000 hits on Instagram and was sold out on pre-orders.
It’s just one of many tricks in the book. In our era of short economic cycles and even shorter attention spans, consumers have an unprecedented amount of choice. From renting your home and sharing a bike to online medical consultation and fitness apps, the current generation is in the midst of a massive shift in engagement with products, brands and experiences. It’s vital for brands to creatively engage attention to survive.
At the same time the landscape of brand experience is morphing before our eyes. Experiences today exist both virtually in the palm of your hand and physically in brick-and-mortar stores. Traditional brand development models have to keep up with this disruption: consumers expect seamless experience across all touch points. In turn, brands expect consumers to absorb and respond to the myriad messages that are directed at them. This hyper-engaged audience struggles with an attention deficit that is both manna and curse at the same time.
In this climate of choice, consumers either selectively use information to confirm existing beliefs (also known as the “availability heuristic”) or are hit by decision paralysis that leads to default, known and safe choices. Mental shortcuts for decision-making alleviates the need for the cognitive heavy lifting of making more deliberate (and time-consuming) choices.
WE’RE TOO INDECISIVE
Defaults appeal to human tendency to take the path of least resistance and are often very successful. In many countries, an opt-out or presumed consent system as a default has dramatically improved organ donation. While the challenges of receiving full consent from the family remain, the power of defaults to drive behaviour change is compelling. So many case studies demonstrate the human inertia to change.
Brands must balance this default psychology with strategies to grab attention. The 1920s Bouba-Kiki experiment was repeated in 2001, with participants from across the world. It revealed a seemingly arbitrary mapping between speech sounds and visual shapes. 95% of those surveyed associate “bouba” with softer, rounder shapes (like brie and cushions), and “kiki” with angular, pointy shapes (like spiky stars).
This sound-symbol association offers tremendous opportunity for multi-sensorial brand experiences. Words can be used with the added meaning of symbolic association in marketing: naming a sharper tasting coffee with a rounder sounding brand name could change perceptions and even acceptance.
Consumer contexts are rapidly changing and, as a result, relationships with brands have never been as complicated and multi-sensory. The marriage of rapid advances in technology and discoveries of neural underpinnings of behaviour leads to newer, more exciting experiences for consumers. Brands are left with the responsibility of adapting to a dynamic landscape. The question is, how will they seize the opportunities that lie ahead of them?