⚡ Improve Customer Satisfaction with the Bottom-Dollar Effect
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A behavioral science-based marketing tip, and
Something interesting from my swipe file.
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In today's newsletter, we're exploring a psychological bias known as the "Bottom-Dollar Effect" and how it impacts customer satisfaction. By understanding this effect, you can create marketing strategies that resonate with your customers and lead to greater satisfaction with your products or services. Let's dive in!
Offer flexible payment options and strategically position your pricing to reduce the perceived strain on customers' budgets, ultimately leading to increased satisfaction with their purchases.
🎓 What do studies say?
Research by Cynthia Cryder, Jennifer Lerner, and George Loewenstein revealed that customers tend to feel less satisfied with a purchase if it exhausts their remaining budget or causes financial strain. In their study, participants were given different scenarios involving spending decisions, and the researchers found that participants reported lower satisfaction with purchases that depleted their budgets.
🧠 How it works
The Bottom-Dollar Effect refers to the tendency for people to feel less satisfied with their purchases if they cause a strain on their finances or exhaust their remaining budget. This effect can influence customers' perceptions of the value and enjoyment they receive from products or services.
The Bottom-Dollar Effect works because we are wired to feel negative emotions when our resources, like money, are depleted. The stress and discomfort caused by financial strain can overshadow the positive feelings associated with a purchase, leading to overall reduced satisfaction.
🔧 How to implement this?
Offer flexible payment options: Help customers feel less burdened by their purchases by offering various payment options, such as installment plans or delayed payments. This can alleviate financial strain and improve customer satisfaction.
Position your pricing strategically: Consider offering tiered pricing, discounts, or promotions that make customers feel like they are getting a good deal without depleting their budget entirely. This can make your product or service feel like a better value and increase satisfaction.
Focus on value and benefits: Emphasize the long-term value, quality, and benefits of your products or services in your marketing campaigns. By focusing on the positive aspects, you can help counteract the negative feelings associated with financial strain.
From the Swipe File Archives
I was scrolling through reddit one day and this ad caught my attention. Here are a few reasons it did, and why you should follow the same framework:
Ad image with contrasting colors compared to the overall platform.
Big numbers (68%)
Title that talks to me (a marketer) and addresses a problem anyone like me would have
I can understand what the tool does in just 5 secs, which was possible by the description above the ad image.
And that’s how you make ad images work.
1. Have an ad image that attracts the the scroller.
2. Retain them with a good description that explains what the ad image/resource/tool does for them.
This holds true for most platforms out there.
Good luck and happy marketing! 🌟
Until next time,
Vijay | Kwerks