Sunday, June 24, 2012

BIG’s Blog: Keep It Simple, Stupid – Part 2

Years ago, right after I graduated from college, I worked in one of my family’s department stores. Our stores were primarily women and children’s clothing. Although I had worked in the stores from the age of twelve, to keep in touch with customer reactions to the merchandise selections, I would work the sales floor daily.

One of the things I learned early on was to limit the choice for the customer to no more than three options. More options than three created confusion and, more often than not, the customer could not make up their mind and walked away without purchasing.

35+ years later, the issue of “too many options” is even more important.

In a new study posted on Harvard Business Review’s Blog Network, Karen Freeman, Patrick Spenner, and Anna Bird share some of the early results of a survey they did with 7,000 consumers worldwide. The results are as important to fundraisers as they are to commercial product companies.

They relate the historical way that consumers have always purchased is through a funnel approach. In simple terms, the funnel is 1) becoming aware of something 2) creating interest or desire to act and 3) gradually reducing the options or brands.

Their research indicates that today’s consumers (and donors) are facing cognitive overload. Modern consumers are overwhelmed by the volume of choices.

Their response to this overload has been three-fold. About one-third continue to use the funnel approach but the other two-thirds evenly divide between first, an open-ended purchase path of adding and dropping brands, while the other half abandon the search altogether and simply zero in on a single brand.

So what are the implications for fundraisers?

The study identified three types of consumers and, since consumers are also donors, it is not a leap to ascribe these same consumer actions to donating as well. This would indicate that the first type of donor continues to be open to messages and engagement from new organizations, and they are actively winnowing who to donate to. The second group you probably don’t want. They may donate today and be gone tomorrow. And the third group will have a bias toward larger nonprofit names.

But the secret, say the study’s authors, is to make your message as simple as you can. “In fact, we found that the single biggest driver of ‘stickiness’ – customers’ likelihood of following through on a purchase, buying the product again, and recommending it – was, by far, ‘decision simplicity,’ the ease with which consumers can gather trustworthy information about a product and confidently and efficiently navigate their purchase options. The bottom line: these days making a decision easy is what makes customers choose your brand.”

For fundraisers, substitute “donate” for “purchase” or “buying,” and “donor” for “customer” or “consumer,” and re-read that last quote.


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