How recognizing cognitive bias can improve sales

Let’s face it right away: everyone in life has faced easy and difficult choices. A person does nothing in his life but making decisions, starting from when he gets out of bed, up to those related to the working field. The day is a continuous succession of decisions, both simple and extremely complicated.

Heuristics and biases

But the question is: how do we make decisions?

Despite the thinking ability that sets us apart from animals, we sadly have to admit that we are not as rational and analytical as we think.

In fact, individuals make decisions based on their feelings, emotions and insights without precisely analysing the data at their disposal. If the human being makes a choice in an exclusively rational way, the decision-making process would be much longer: for each choice he would have to examine every single possibility including innumerable variables and only after analysing everything he would be able to finally make a choice, through logical deductions. Which in reality does not happen.

In short, deciding is a sort of infinite process not carried out through complicated reasoning, but rather through intuition and what are scientifically called heuristics.

Heuristics are cognitive shortcuts typical of an intuition of the general situation and we need them to deal with all the huge amount of information that we have. In fact, through heuristics people make decisions based on approximate rules, which each individual re-elaborates based on his experience.

Heuristics can speed up our problem and the decision-making process, but what happens when there is an error in our intuitions? In this case we talk about cognitive bias. This is an error within the action of thinking that affects the judgments that people make.

Some of these biases are related to memory or lack of attention. In the first case, the way we remember an event may be biased. In the second one, assuming that attention is limited, people are selective about what they pay attention to. All these factors can lead to biased thinking and decision-making.

But let’s get back to the reason why it is important to be able to recognize cognitive biases if you are working in the marketing field. In short, the bias leads to a slight distortion of reality that affects the user’s purchase decision. Recognizing these thought patterns are useful both to sellers, to learn how to increase sales, and to consumers, to be more aware in making purchasing decisions.

Below the most common cognitive biases related to marketing (here you can find out more about cognitive biases in general).

Choice supportive bias

By choice supportive bias it is meant the belief that the option chosen is better than those rejected. Generally, we are sensitive to all the information that feeds this belief and that makes us feel better for having made a certain choice.

Example: milk naturally contains vitamin D, yet how many times do we read on the package “This milk contains vitamin D”? This is a marketing tactic: we feel better for having chosen it. In fact, the vitamin D content of that particular product from that brand does not make it different from its competitors.

From a vendor’s point of view, it is important to find a strong point that can distinguish your product from competitors. Ask yourself: what can make my product the best choice?

Did you find the answer? Well, now just start to insist on this feature.

Confirmation bias

Confirmation bias is strictly linked to the previous concept: we believe that our choices are the best and we need continuous confirmation to support our thesis. This bias is amplified even more by social media.

Example: those who have a specific political thought will always follow pages and profiles that reinforce their thinking.

When it comes time to sell, it’s important to tell customers what they want to hear. This does not mean manipulating them: a store of organic products’ communication plan should include content about related topics, such as the environment or health, in order to confirm that the choice to buy in that store is the best option.

Framing effect

The content is essential but undoubtedly the way in which it is said is even more important. This is the reason why a communication expert is necessary for your company if you wanto to obtain a positive reaction from the listener.

What is your reaction if you say:

2 out of 10 people have failed to lose weight on this diet

What if I said instead:

8 out of 10 people have managed to lose weight on this diet

Everything changes, right? The framing effect is a bias that makes us evaluate information based on what surrounds it.

Example (recommended to sellers!): brand “A” releases two versions of a camera on the market. The first costs $80 and the second $120. Assuming we have no particular needs, we choose the cheapest version. Imagine this scenario: the brand launches 3 different versions on the market. One for $ 80, another for $120 and the top one for $ 250. In this case we normally choose the $120 version: for a few dollars more you have a more advanced version but still not as expensive as the top version. In short: you always buy the product inside the frame.

Zero-risk bias

We basically have one fear: to lose. This is the reason why people are more motivated by avoiding a loss than by making a profit. Just think: receiving $10 makes us considerably less happy than losing the same amount of money makes us sad. Yet it is still $ 10!

The zero-risk bias is the tendency to prefer offers that do not involve any kind of risk or consequence and for this reason the satisfied or reimbursed formulas or free trial periods are successful.

Anchoring

Anchoring consists in the initial idea that an individual has based on the first information he finds about a specific topic or, in this case, a product. While we are looking for information about a product, the first result we get is the most important because we will use it as a comparison with everything we find later.

Example: if the first result we find costs $100, when we find the same product at $70 we will think that it is a great offer, while a cost of $130 will be too expensive.

Have you ever wondered why, when an item is on sale, there is also the original price written on it? The aim is to give an idea of ​​the true value of the product and emphasize how much the discount represents an unmissable opportunity.

Bandwagon effect

We greatly feel the need to adopt behaviors accepted by other individuals. This is the reason why it is possible to influence the public choices through the opinions of important people and influencers.

Imagine a situation where you want to go out for dinner and are looking for a restaurant to go to on the Internet. There are two options in your area: the first one full of reviews and photos published by clients and the other one does not have any review. Which one are you most likely to choose? 91% of people would be influenced by reviews and they would choose the first restaurant. This is the bandwagon effect.

In a social editorial plan, don’t neglect customer reviews and opinions but rather encourage your satisfied clients to review your product or service. For example, you could offer a discount to those who leave a review (here you can find some tips about).

Salience

We talk about salience when there is a detail of an object that takes on greater importance than the context in which it is located and consequently it is immediately identified on a visual level. If we meet a person with extravagant hair on the street, we will tend to remember him for that detail rather than for the physiognomy of his face.

Why is this bias important for a good marketing strategy? Because it makes the public come to hasty conclusions based only on some obvious characteristics.

Another example is the close relationship between Coca-Cola and the iconic color red. This relationship involves an emotional reaction in people and it determines their choice at the time of purchase.

We are at the supermarket and looking for a refreshing soft drink when we see something red in the distance. Red, Coca Cola, a guarantee. End of the story: we take a can without thinking too much about our choice.

In-group favouritism

Each person belongs to a group by age, religion, geographical origin, etc. and every individual may see other groups more or less negatively.

The action of looking for reviews is a consequence of this bias. In fact, before buying a product, we seek the opinion of people who may be similar to us and who have already made the purchase. And we will act accordingly as they did.

Do not forget to address your interlocutors as if you were part of their group: declare the same values, discuss topics that are interesting for them, in short, increase the sense of belonging to a community. And, again, encourage positive reviews!