Why People Buy And Don’t Buy

February 22, 2013

by Walker Smith

 

FROM BRANDING STRATEGY INSIDER ›

Why people buy is not the same as why people don’t buy. For brand marketers, it’s a difference that matters more than ever.

The things that motivate people to buy are product features that people want. People buy a particular car because it has the gas mileage they want. Or they buy a certain smartphone because it has the multimedia capabilities they prefer. Or they pick one brand of detergent instead of another because of price. (I am leaving out emotional benefits in these examples, but only to keep things simple not to suggest emotional features are unimportant in a category.)

When it comes to making a purchase, people want the best product of that type. So the things that matter when people buy are the things that make one brand a better choice in that category. When the cash register rings, it signals a buying decision that has been made on the basis of category features, as well as the trade-offs people have made of one feature versus another.That’s why people buy.

It’s not that simple when people don’t buy. Obviously, one reason people don’t buy is because another brand has better category features, as just mentioned. But a different dynamic looms larger. Some things that matter little in deciding to buy are all that matter in deciding not to buy.

This is where something like social responsibility comes into play. For a growing number of people, social responsibility is relevant to their marketplace decisions. Yet, little research shows it to be a big part of decisions made between brands in a category. That’s because social responsibility is not about why people buy; it’s about why people don’t buy.

Social responsibility, corporate ethics, workplace safety and other such non-product attributes factor in as reasons not to buy. People avoid, ignore or boycott a brand, or even a category, because it doesn’t measure up to standards of good stewardship and rectitude.  But once that hurdle is cleared, the choice between other equally principled brands is a matter of category features.

The knock on something like social responsibility is that despite the lip service given to it, it doesn’t influence behaviors. This is true in the narrow frame of picking one brand over another. But it is not true in the broader frame of choosing any brand or category at all. The influence of social responsibility and other such considerations plays out in the brands or categories people are willing to consider to begin with. Far more often than not, the impact of social responsibility is a decision not to buy.

As social responsibility and the like become salient to more and more people, they will increasingly function as gating factors for consumer decisions. They will cull the consideration set but not determine the final choice. Which means a dual currency in the marketplace.  First, people must buy that a brand or category measures up. Only then will people be willing to consider it as an option to buy.

Brand marketers are experts in communicating reasons to buy. This is the sweet spot of traditional advertising. Brand marketers are less experienced and thus less adept at deflecting and calming reasons not to buy. But such considerations are of growing importance to people. They want reassurances that a brand is not irresponsible or unscrupulous, even if, ultimately, it doesn’t measure up enough on some key category feature to buy.

The important takeaway here is that social responsibility cannot be ignored or underestimated just because it is not a reason to buy. It affects the purchase funnel in a more fundamental way. To properly appreciate it, social responsibility must be correctly understood. It is not about why people buy; it is about why people don’t buy.

Another way to understand this marketplace dynamic is to borrow a concept from prospect theory, the breakthrough decision framework first articulated by psychologists Amos Tversky and Daniel Kahneman in 1979. One of the two core ideas of prospect theory is that losses loom larger than gains in the ways in which people make choices.  This makes a difference in how consumers make sense of social responsibility and other such factors.

Social responsibility matters most when companies don’t have it. It is a loss which people don’t want or don’t want to be associated. On the other hand, category features are things people gain when they purchase a specific brand. Losses matter more than gains in the ways in which people think, so losses become reasons not to buy. When a loss looms, avoiding it takes precedence, even at the cost of sacrificing other gains. The benefits people gain by purchasing a brand are satisfying only if the losses that matter more are dodged first.

Social responsibility is criticized for little power to drive choices in the marketplace.  That’s because brands marketers are focused first and foremost on why people buy. But to really appreciate the power and importance of social responsibility, brand marketers need to focus instead on why people don’t buy.