Sell Happiness, Saving Time; Not Saving Money
With the recession hitting all businesses hard, one might think it wise to market the cost savings of their products or services. However, a recent study might prove otherwise according to an article published in the WSJ.com.
In a study by researchers at Stanford Business School, published in the Journal of Consumer Research, found that consumers were more likely to purchase products when businesses stressed the importance of time and personal experiences rather than focusing on the monetary value of the product.
The reasoning behind this is “… a person’s experience with a product tends to foster feelings of personal connection with it, referring to time typically leads to more favorable attitudes—and to more purchases,” says Jennifer Aaker, a Stanford marketing professor and one of the co-authors of the study, according to an article on Stanford’s website.
They conducted one experiment using a lemonade stand – staffed by two six-year-olds – and tested the effect of three different signs. The first sign read “Spend a little time and enjoy C&D’s lemonade.” The second sign had “Spend a little money and enjoy C&D’s lemonade.” The last sign read “Enjoy C&D’s lemonade.” Customers were asked to pay any amount between $1 and $3 for a cup of lemonade.
The results of experiment one showed that the sign stressing time brought in twice as many customers as the sign stressing money, and those customers were willing to pay twice as much. Those customers who bought with the sign mentioning time also reported liking the lemonade more than the others.
A second experiment involved college students and their iPods. Researchers divided the college students into two groups. The first group was asked how much time they spent on their iPod and the second group was asked how much money they put into their iPod. Researchers found that those who were asked about how much time they spent using their iPod held a much more favorable opinion than those that were asked how much was spent.
One exception involves companies that offer luxury products, jewelry, and other items of prestige demonstrate a better consumer response when ads focus on monetary value rather than time and personal experiences. Researchers believe that owners just like owning these products regardless of the time spent with them.
Researchers concluded that businesses should spend more time spreading the message how their product or service improves the lives and happiness of their customers rather than how it saves money. The mere mention of the word “time” and avoiding any mention of money can make a difference in customer response.
“In the context of a real business, conducted among a variety of consumers, this experiment shows that merely mentioning time rather than money in a product’s marketing materials can make the very same product more alluring and better liked,” the authors note.