The 5 Rules to Managing How Your Customers Make Decisions

The 5 Rules to

Managing How Your Customers Make Decisions

 

A lot of Behavioral Economics can feel intimidating. However, it doesn’t have to be. The Five Rules Podcast Series is our attempt at giving you an easy entry point into the complex and messy world of Behavioral Science.

 

What Are The Five Rules?

 

How people make decisions is a complicated and fascinating subject. Understanding the process and the role your Customer Experience design plays in it is essential to providing the platform to encourage customer-driven growth. To that end, here are the five rules to bear in mind when managing customer decision-making:

 

1. Embrace the fact that customers don't always make rational choices. 
2. Strive to make customers buy from you intuitively. 
3. Discover your customers' decision-making strategy. 
4. Map your customers' habits. 
5. Design your experience understanding the different ways customers make decisions.

 

What Should You Do With Them?

 

1. Embrace the fact that customers don't always make rational choices. Before you can proceed in this management process, you should first accept that your customers do not make rational decisions all the time. Rationality plays a role, of course, but it not always the driving force behind the yes or no customers give you. This concept applies to the business-to-consumer as well as the business-to-business market. Many organizations have based their experiences on the idea that rational decision-making is the driving force. If you do the same, you run the risk of ruling out ways you can create a competitive advantage. By opening up your solution set to include the emotional in addition to the rational, you not only create a winning formula for winning customers and prospects over, but you also create a competitive differentiation that is hard to beat by your competition. 

 

1. Strive to make customers buy from you intuitively. Intuitive purchases are automatic and occur without the customers giving it a second thought. This situation is ideal for obvious reasons. However, it requires creating an easy experience that appeals to customers' need for simplicity while also meeting their needs.

 

1. Discover your customers' decision making strategy.  There is a multitude of ways that customers use their rationality and irrationality in tandem to make buying decisions. Some methods are based on how you position the offer, others on the customers' tolerance for risk; others are based on how much effort they are willing to put into the purchase process. We recommend determining how your customers make decisions and use that pattern to help you design an experience that leads them to the choice you want. When you can do this successfully, you create a competitive differentiation few organizations are willing to undertake.

 

1. Map your customers' habits. Habitual behavior is one of the ways customers make intuitive decisions to go with your product or service. A trigger in your experience signals the habitual response to start. However, your competitors have triggers, too. When you can spot the triggers, either yours or the competition, you understand how to meet your customers or move your customers to a different behavior where you want them to be. 

 

1. Design your experience understanding the different ways customers make decisions. When you apply the previous four rules in an exercise we call Behavioral Journey Mapping, an advanced take on traditional journey mapping, you can see how the different touchpoints in an experience influence customers' decisions. You can then determine what experience you wish to deliver so that you can take deliberate actions in the appropriate moments to encourage or change cust