How customer uncertainity is ruining your Sales numbers & how to tackle it

Intro

Most of the selling is based on emotions. Evoking the right emotions leads to higher sales.

Certainty is one such emotion. The more certain a potential customer is feeling, the more likely they are to buy.

However this feeling of certainty or uncertainity is induced by so many factors outside our control.

Here are the major uncertainity inducing factors:

• Uncertainty triggered by external stimuli. These are of 3 types:

1. Economic reasons - Recession, oil supply disruptions etc

2. Societal reasons - Low uncertainty tolerance (korea) vs High uncertainty tolerance ( USA), level of individuality etc

3. Personal reasons - Job loss, sickness, accident, income class etc

People are exposed to this type of uncertainty a lot as they consume news about the economy and society (which is mostly negative) on a daily basis

• Uncertainty triggered by the decision or the product itself. This is of two types:

1. Uncertainty about the alternatives - Not knowing about the alternative products/services enough

2. Uncertainty about the utility - Not knowing how well will the product or service will perform

Key takeaway of the research

Figure out the cumulative level of uncertainity in your target audience. To do this look at the current economic atmosphere, societal factors, and personal factors listed above.

Then figure out how does your target market perceive your product in terms of newness and unfamiliarity.

Your product might have a new feature but might belong to a well established product category. This will be considered a familiar product as compared to a product that belongs to a new product category itself.

Eg: iPhone 15 (smartphone) vs Apple Vision pro (Mixed reality device)

Now considering all these factors, decide on the level of concreteness (vs abstractness) to use in your messaging.

Concrete messaging is more specific, tangible and contextualized. Abstract messaging is the opposite.

The research has found that the more uncertain the potential customers feel, the more concrete messaging performs better for sales.

Research Findings

Results from the experiment when uncertainity was induced by external stimuli. 

The external stimuli used was making the participants read and write about uncertain economic, political and personal events before they were asked to evaluate the products and state their willingness to pay

The following were the findings:

• Concretely described products were evaluated 17.4 percent more positively when feeling uncertain than when participants were feeling certain.
  

• Abstractly described products were evaluated 22.4 percent more positively when feeling certain than when feeling uncertain
  

• When feeling certain, there was not much difference in evaluation of concretely described products vs abstractly described products
  

• For abstractly described products, the amount participants were willing to pay was higher under certainty than uncertainty
  

• when feeling uncertain, participants were willing to pay more for the products when described concretely than when described abstractly

  

  
  

Results from the experiment when the product itself induced uncertainty. 

To measure if the product induced uncertainity, the participants were asked to rate the level of familiarity with the products before they were asked to evaluate them (unfamiliar products incite uncertainity as one cant accurately determine the utility and the performance of the product)

The following were the findings:

• The results show that when people are less willing to explore new things, novel products are evaluated 31.2 percent more positively when described concretely than when described abstractly
  

• This effect was reduced for participants who were more willing to explore new things but it was still there ( 9.4%).
  

Underlying causes

Previous research has found that as the uncertainity experienced by people goes up, the following things happen:

1. People relied less on heuristic authority cue (Heuristic authority cue: tendency of our mind to believe authority figures readily)

2. People believe concrete statements to be more true than abstract statements.

3. People seek to find order, structure and coherence to cope with uncertainty. Concrete and specific statements provide that order and structure.

Moreover humans have a general tendency to be intolerant of uncertainity. Amygdala, a structure in our brain, deals with Uncertainty. It is one of the earliest formed structures in complex organism (think hundreds of millions of years)

Since this structure is this old, it is quite powerful and stops us from making rational decisions (which is the job of the relatively newly formed structure prefrontal cortex)

Putting it into practice

• If you are a luxury brand, you can get away with using more abstract messaging as the target market is more certain about their finances and not too concerned about the functional utility of the product
  

• If you are bringing to market a product that belongs a very new product category (think apple vision pro or neuralink), then you should use concrete messaging more.
  
  Even with early adopters of new technology who have a tendency to seek out new technology, concrete communication works better
  

• Ofcourse your messaging cant be hundred percent concrete or abstract. You have to decide what percentage of it would you like to be concrete vs abstract considering the different factors we discussed in the introduction of this post.
  
  Messaging is both an art and a science. And in any art form, intuition plays a big role in deciding what might resonate with the audience.
  
  You will have to use your intuition and past experience to decide how much concrete statements you want to use in your messaging!

About the study

3 controlled lab experiments and one study under naturalistic settings were conducted. In one study the effect of uncertainity induced by economic, societal and personal events was studied.

In the second one, the effect of the uncertainity of a sports match on buying behavior was studied.

and in the third one, effect of uncertainity induced by new and unfamiliar products was studied.

The studies were done in 3 languages: English, German and Dutch and across different product categories: detergents, radio stations, cameras

The different populations studied were students, supporters of a sports match, Mturk workers

Since so many variables were taken into account, the study’s findings are very robust and applicable to most markets.

The research Paper

When it pays to be clear: the appeal of concrete communication under uncertainty by Femke Van Horen et al

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