Keep it simple stupid! New research from the University of Western Australia shows Aussie consumers actually crave less choice and simpler experiences – despite companies offering more options, promotions and price variations than ever.
The results of the study, published in the International Journal of Management, found that bringing down customers’ mental load during shopping creates value for shoppers, as well as the companies selling the items.
Dr Richard Gruner and Professor Geoff Soutar from the university’s Business School explored the concept of cognitive simplicity (basically how well people perceive things) to evaluate how it affects the value customers get from their interactions with businesses.
According to Dr Gruner, consumers have become mentally fatigued from the increasing number of choices they have to make every day, and to be successful companies should try to avoid adding to this complexity.
Customers are willing to pay more for simplicity
“We found consumers are willing to pay more for, and are more likely to cherish, brands they perceive as simple,” he explained.
“What matters more than an in-your-face presence is simplifying customers’ lives and solving their problems.”
The researchers found that most buyers who did not follow through on an intended purchase backed out because they were overwhelmed by information and choice.
“Consumers tend to reward companies that drive down their mental load and many brands – including Aldi, Netflix and Google – owe some of their success to their ability to simplify consumers’ experiences,” Dr Gruner stated.
At the core, smart brands make things easy and convenient for the end user through clever decisions about their product, promotion, price and distribution tactics.
Rewarded with good performance and loyal clients
“These brands consider the entire customer journey throughout their organisation and are, in turn, often rewarded with strong performance and loyal customers,” he said.
Dr Gruner has published an additional article in the prestigious US-based Harvard Business Review on strategies to simplify the customer journey.
Among these are providing fewer products, features, or capabilities without compromising the effectiveness of the product or service.
Companies should also limit the tendency to vary prices based on loyalty, season, purchase location, channel, or demographics. While this approach can increase profits, it also increases complexity for the customer.