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Is there is a systematic error in your Thinking?

Updated: Nov 11, 2021

Lean more about Cognitive biases and how that influences Customer purchase decisions


What are Cognitive biases and how can you use them to influence the purchase decision?


In order to influence purchase decision you need to understand what a “bias” is. So we would start from there.


“A bias simply is an inclination or prejudice for or against someone or something.”

So how does that come about and what is a “Cognitive bias” then? Well, whenever we are presented with a situation we rationalize the information and understand it. Sometimes what happens to most of us is that there is a deviation from reality. Individuals create their own “subjective reality” from their perception of the input information and that results in an individual’s construction of reality which sometimes leads to inaccurate judgement, illogical interpretation or simply irrationality.


Why do we humans fall into the bias trap?


Our brains are wired in a way to naturally reduce tasks and simplify things. In that process whenever we are presented with a decision or some form of information, we use our perceived knowledge of the input to arrive at a judgement or understanding which is essentially Cognitive bias.



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Let us share with you some common Cognitive biases which will help you relate better –


Conformational Bias:

Over evaluating information that confirms our values or beliefs

E.g. A person looking for physical signs of lying while speaking to another person might mistakenly classify some behaviour as evidence of lying, which isn’t actually the case.


Gamblers Fallacy:

It is the tendency that something will happen as it has not happened yet.

E.g. Assuming you would hit the blackjack in the current game as the previous 3 outcomes were not blackjacks or Assuming that the outcome of roulette would be black if the last 4-5 outcomes were black – In reality, the probabilities are not related to previous outcomes.


Gender bias:

This would be known to many. It is the tendency to assign a specific behaviour and characteristics to a particular gender without supporting evidence.

E.g. Women are perceived as better caregivers than men – which is not a hard fact and Students often rate female teachers lower than male teachers – In reality, both teachers are equally qualified and competent.


Group attribution error:

It is a tendency to overgeneralize how a group of people will behave based on an interaction with just one or a few people from that group.

E.g. A negative experience with a person from a different group/culture/ religion/gender, etc. might make you say that all the members of that group share the same characteristics. Like sometimes people say Dutch people are rude – which is totally not the case, they are really nice and caring people or Indians never make it on time/ are not punctual which is not the case for every Indian and likewise.


Now that you have understood what a Cognitive bias is, let us explore how to use this knowledge to influence purchase decisions.


Category bias: People are looking for cues to simplify purchase decisions. Short descriptions of key product specifications help simplify that. E.g. Products or brands having short descriptions such as “No added sugar” or “100% organic” are more likely to get purchased. Key takeaway: Include short descriptions that help customers simplify purchasing decisions.

Power of now: The speed of availability of the product is an important factor that determines the final behaviour. The longer one has to wait for a product, the weaker the proposition becomes and the less likely to get purchased. Key takeaway: Make sure you deliver your products or make them available within an acceptable time limit.

Social proof: Consumers go through a loop of evaluation and exploration before making the final purchase decision. The evaluation stage involves reading recommendations and reviews which reinforces the decision and helps consumers decide better. Key takeaway: Encourage users to share their experience so others can benefit from it and share their feedback with you so that you can improve on your product/service.

Scarcity bias: If a thing is available in limited stock, more people want to have it – simply put, the faster the availability of the stock decreases, the more desirable it becomes. It stimulates FOMO in the consumer's minds. Key takeaway: Use this strategy if you have a high-quality product to create a positioning and reach for the brand.

Power of free: Imagine buying a can of milk and getting a sample of cookies free with it – feels great right! A gift with a purchase related or however unrelated can be a powerful motivator to influence purchase decisions. Key takeaway: Use this tactic to test new products or sample products to drive consumers to it.


Our goal, in the end, should be to minimize the gap between the trigger and the purchase decision by providing them information or using the knowledge about biases so that they spend less time in the Exploration and Evaluation loop.

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