Why did you buy your last car? Your last house? The shoes you’re wearing right now? How about that coffee you had on the way to work? In fact, what influences our purchasing decisions? The answer is obvious: the driving force behind every purchase is, quite simply, the desire to improve your life. Every time you make a purchasing decision – whether at work or in your personal life – you do so in the hope of improving your life. It’s the same for your customer. If you’re in the business of selling a product or service (and frankly, who isn’t?) you absolutely must understand how your customer makes his or her purchasing decision.
Existing dissatisfaction
It all starts with existing dissatisfaction. If the goal is to improve one’s life, then there must be something to improve. In short, something in the buyer’s life is unsatisfactory. Existing dissatisfaction (EI) includes anything that needs improving: a pre-existing concern, a crying need, dissatisfaction with the current product or supplier, disappointment with a previous purchase, and so on. Imagine you sell cars. It doesn’t matter how beautiful your model is, how much it costs, or what consumers say about it. None of that matters if there isn’t an existing dissatisfaction with your customer’s current vehicle.
Promise
Once the EI is well established, we can move on to the second element: the promise. In many ways, promise (PR) is the flip side of EI. If I know something is bad, I also have a vague idea of what might be “good”. And that’s the promise. The promise is about more than features. It’s about making life better. PR serves to establish what Daniel Kahneman calls “anticipated memories”. Good PR is inherently personal and visionary. It is also personalized for each prospect. PR is at its most effective when EI is at its highest. In other words, the higher the EI, the stronger the desire to find PR as a solution.
Cost + Fear
IE and PR are two powerful motivators. However, there are two factors that work against the buying decision process: Cost and Fear. Cost and Fear (C + P) are factors that naturally work against the prospect. These elements must be effectively neutralized to move the customer forward. We consider these factors as two independent inhibitors to account for the fact that one part of the decision is logical and the other is emotional. Cost includes price, conditions of sale, labor, time, hassle… i.e. practically everything that can be – even approximately – measured. Fear, on the other hand, represents everything emotional. Between the two elements (cost and fear), it’s the latter that represents the more difficult challenge.
Apply the purchasing formula
Here’s how to sum up the buying formula. A person buys if and only if : IE x PR > C + P It’s useful to understand some of the principles governing this buying formula so you can apply the concept to your own business.
- The formula is sequential.
It starts with existing dissatisfaction, then moves on to recognizing all the other factors in succession. - The formula is personal.
Every customer is different. - The formula is predictive.
The greater the existing dissatisfaction and the promise, the greater the chances of a purchase. - The formula is dynamic.
The various elements of the formula can be influenced during the relationship with the customer, which will evolve over time. - The formula is directive. If, during my analysis, I see that the existing dissatisfaction and the promise are easily established, there’s no need to waste too much time, means and energy, the sale should already be easy.
Try this formula. Apply it to the Nescafé you had this morning. Or to the house you bought last year. Or to the last sale you made. And above all, use it every day. This buying decision formula can help you gain an essential understanding of how to better serve your customers, and how to change someone’s world in the process. Yes, that’s right!
