Predicting consumer behavior… Brand loyalty vs. the whacky, random ways people often buy things.

by John Furgurson on July 15, 2009

Corporations spend billions every year trying to predict consumer behavior. Market research firms have sophisticated modeling protocols, ivy league PHDs and multivariate analysis to help them make sense of what is, inherently, nonsensical behavior.

Take, for example, the time my dad decided to replace his rusting Ford pick-up. He drove two hours to the Big City so he’d have plenty of truck dealers to choose from. He spent the weekend kicking tires, braving the onslaught of old-fashioned salesmen and test driving every make and model.

Then he came home in a Toyota Matrix.

 

Not exactly built for an over-70 demo.

Not exactly built for an over-70 demo.

He was 70 at the time! God only knows what possessed him to switch from a pick-up truck to an urban pocket-rocket. The Matrix is more suited to base-thumping car stereo blast-a-thons than my dad’s easy-listening coastal lifestyle. 

 

No one could have predicted it.

In hindsight, I suppose you could say it was consistent with his car-buying history, which is even more erratic than his golf game. I challenge anyone to find a pattern in this list:

1968 Fiat 124 Sport Coupe

1970 Chevy Caprice Station Wagon

1973 AMC Hornet

1974 Chevy Vega

1976 Ford LTD 4-door sedan.

1984 Mazada 626

1991 Ford Taurus

1994 Ford F-150 Pickup

2002 Ford Taurus

2007 Toyota Matrix

Obviously, he has no brand loyalty. The only constant is a sedan of some kind for my mom. (I’ve decided he buys cars the same way he buys fruit… Whatever looks good, smells sweet and is on sale at that particular moment.)

You might think that’s a little weird, but research published by University of Iowa neurologist Antonio Damasio shows that most purchase decisions are almost as random as my dad’s car buying.

Damasio says marketing messages are processed outside the conscious mind. Emotions push us toward decisions we think are best for us, and we often bypass reason because experience endows us with what he calls “somatic markers in the brain.”

Somatic markers are the most likely biological basis for intuition. These pre-recorded behavior guides are based on inherited behavioral traits and formed by experience. When making decisions, somatic markers are triggered, often making reason irrelevant.

So it’s intuition and emotion that drives real life purchasing decisions. Not logic.

As Dr. Dean Shibata put it, “If you eliminate the emotional guiding factors, it’s impossible for people to make decisions in everyday life.”

On the other hand, when people are asked hypothetical questions about purchases, as in a focus group, the brain works on a much different, analytical level.

“Instead of the real reason for buying, researchers get a rationalization based on the respondent’s idealized self-image. If they don’t account for this bias, researchers are left with a model based on how people think they ought to be motivated, rather than their actual motivations.”

So beware of market research that demands a rational explanation for irrational behavior.

And here’s another thing that makes consumer behavior hard to predict… Many times we aren’t “qualitatively conscious” of our motivation. “Consumers have limited knowledge of their own values, needs and motivations that affect purchase decisions,” says Neurologist  Richard Restack.

So my Dad probably doesn’t even know why he made that decision to drive home in a Matrix.

The point is, all purchases are emotional purchases.

So the next time you’re throwing together a sales presentation, you might want to spend more time trying evoke an emotional response, and less time building charts and graphs.

Reason certainly does play a vital role in the early stages of many buying decisions. But in the end, the actual purchase is entirely emotional.

Here’s an example from my own, personal experience.

I recently bought a new golf club. I’ve read a lot about the new hybrids, and I decided it was time to replace my 5-wood that was never quite right.

So I did some on-line research, studied the reviews in Golf Digest and formulated a short list of clubs to try.

All very thorough and rational.

 Then I went to a demo event at a local golf course to see, feel and try them for myself. I ruled out a few right away on a purely subjective basis… what  they looked like or how they sounded.

After an hour or so I had it narrowed down to three top contenders. There was very little difference between the three, that I could see. All things being equal, the brand was the tipping point.

After I went through the whole meticulous process, the somatic markers in my brain kicked in, and said “go for it. Get the Nickent. This is the right fit and a good, safe purchase.”

I didn’t choose the biggest selling brand, but one I perceived as being the more specialized upstart. The underdog with an impressive presence on tour. And the company I most admired from a business perspective.

 Not exactly a rational decision, when all was said and done. It had nothing to do with the features they tout.

The point is, people are unpredictable. As marketers, the minute you start thinking you really know your audience’s hot buttons and can predict their behavior, forget about it. They throw you a curveball and go for the Matrix.

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{ 3 comments… read them below or add one }

Sean July 15, 2009 at 3:29 am

If you can recall and explain the a-rational influences that drove you to make a purchase, then it seems likely that survey respondents or focus group participants might be able to do something similar–i.e. describe their feelings.

Abhinaya Chandrasekhar August 9, 2009 at 8:08 am

This is so right. I work in advertising and trying to predict consumer insights to define a creative route is the toughest. Even if we do manage to predict something, there is no guarantee whether we got it right or not!

Celu Tonos August 11, 2009 at 8:09 pm

My son told me to check out your blog and I must say I’m impressed, very helpful.

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