Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
BEHAVIORAL ECONOMICS : WHY CONSUMERS ARE UNREASONABLE SPENDERS
CONSUMERS DO NOT ALWAYS MAKE RATIONAL DECISIONS It's often assumed consumers always make buying decisions based on costs a...
“In this field, we don’t assume that people are perfectly sensible, calculating machines. Instead, we observe how people a...
LET’S ELABORATE ON WHAT BEHAVIORAL ECONOMICS TELLS US, BY LOOKING AT HOW ANNIE SHOPS.
FIRST STOP: ELECTRONICS Out of all laptops with 1 TB storage, she chose the one that offered a 24- month installment plan.
Consumers love layaway or installment plans because small delays of payment make the painful parting with your precious ca...
SECOND STOP: WALLETS Annie fell in love with so many chic leather wallets that she got confused. She couldn’t pick one, so...
ACCORDING TO BEHAVIORAL ECONOMICS… “Choice Overload” forces consumers to think harder before making a decision. This reduc...
THIRD STOP: SOCKS Annie walked past her favorite sock brand to choose from the huge buy- one-get-one pile.
ACCORDING TO BEHAVIORAL ECONOMICS… Consumers love the word “free.” It magically evokes positive feelings toward a product.
FOURTH STOP: TOWELS After comparing the absorbency, fiber content and style of several different towels, she narrowed down...
ACCORDING TO BEHAVIORAL ECONOMICS… Consumers associate price with product quality. The brain apparently assumes that the h...
FIFTH STOP: CLOTHES Annie checked out the newest boutique in town. She noticed that their prices were much lower than at h...
Once consumers have mentally established a set price for a particular product or product type, their willingness to buy si...
“It is true that from a behavioral economics perspective we are fallible, easily confused, not that smart, and often irrat...
contact: support@slideshop.com fb: theslideshop twitter: @slide_shop blog: http://blog.slideshop.com/ pinterest: Slideshop...
Upcoming SlideShare
Loading in …5
×

Behavioral Economics: Why Consumers Are Unreasonable Spenders

35,219 views

Published on

Consumers do not always purchase goods based on facts or logic. Emotions and social psychology sometimes play a role in the buying decision process.

Published in: Retail, Marketing
no profile picture user
  • Writing a good research paper isn't easy and it's the fruit of hard work. You can get help from writing. Check out, please ⇒ www.HelpWriting.net ⇐
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • Hello! I can recommend a site that has helped me. It's called ⇒ www.HelpWriting.net ⇐ They helped me for writing my quality research paper on diabetes, and of course by keeping my all other needs fulfilled.
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • You have to choose carefully. ⇒ www.HelpWriting.net ⇐ offers a professional writing service. I highly recommend them. The papers are delivered on time and customers are their first priority. This is their website: ⇒ www.HelpWriting.net ⇐
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • The professtional essay writer are having more knowledege about the writing papers. The professional essay writer are providing the best essay writing services papers to the students. The writeersity writing company had to providing the more writing papers for the professtionalist. The papers should be very quality and possible to acedemic success. ⇒ www.HelpWriting.net ⇐ Good luck!
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • I have always found it hard to meet the requirements of being a student. Ever since my years of high school, I really have no idea what professors are looking for to give good grades. After some google searching, I found this service ⇒ www.HelpWriting.net ⇐ who helped me write my research paper. The final result was amazing, and I highly recommend ⇒ www.HelpWriting.net ⇐ to anyone in the same mindset as me.
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
Show More
Show More

Behavioral Economics: Why Consumers Are Unreasonable Spenders

  1. BEHAVIORAL ECONOMICS : WHY CONSUMERS ARE UNREASONABLE SPENDERS
  2. CONSUMERS DO NOT ALWAYS MAKE RATIONAL DECISIONS It's often assumed consumers always make buying decisions based on costs and benefits. It turns out personal biases and habits often divert them from what would seem to be rational thinking.
  3. “In this field, we don’t assume that people are perfectly sensible, calculating machines. Instead, we observe how people actually behave, and quite often our observations lead us to the conclusion that human beings are irrational.” THIS TYPE OF CONSUMER BEHAVIOR LED TO THE STUDY OF BEHAVIORAL ECONOMICS -DAN ARIELY-
  4. LET’S ELABORATE ON WHAT BEHAVIORAL ECONOMICS TELLS US, BY LOOKING AT HOW ANNIE SHOPS.
  5. FIRST STOP: ELECTRONICS Out of all laptops with 1 TB storage, she chose the one that offered a 24- month installment plan.
  6. Consumers love layaway or installment plans because small delays of payment make the painful parting with your precious cash more bearable. ACCORDING TO BEHAVIORAL ECONOMICS… 24-MONTH INSTALLMENT PLAN
  7. SECOND STOP: WALLETS Annie fell in love with so many chic leather wallets that she got confused. She couldn’t pick one, so she opted not to buy any of them on this trip.
  8. ACCORDING TO BEHAVIORAL ECONOMICS… “Choice Overload” forces consumers to think harder before making a decision. This reduces the likelihood of purchase.
  9. THIRD STOP: SOCKS Annie walked past her favorite sock brand to choose from the huge buy- one-get-one pile.
  10. ACCORDING TO BEHAVIORAL ECONOMICS… Consumers love the word “free.” It magically evokes positive feelings toward a product.
  11. FOURTH STOP: TOWELS After comparing the absorbency, fiber content and style of several different towels, she narrowed down her options to two. Then she decided to buy the more expensive one.
  12. ACCORDING TO BEHAVIORAL ECONOMICS… Consumers associate price with product quality. The brain apparently assumes that the higher the price, the better the quality. HIGH QUALITY
  13. FIFTH STOP: CLOTHES Annie checked out the newest boutique in town. She noticed that their prices were much lower than at her favorite shop. She purchased a couple of blouses.
  14. Once consumers have mentally established a set price for a particular product or product type, their willingness to buy similar items depends on this “anchor price.” ACCORDING TO BEHAVIORAL ECONOMICS…
  15. “It is true that from a behavioral economics perspective we are fallible, easily confused, not that smart, and often irrational. We are more like Homer Simpson than Superman. So from this perspective it is rather depressing. But at the same time there is also a silver lining. There are free lunches!” - Dan Ariely -
  16. contact: support@slideshop.com fb: theslideshop twitter: @slide_shop blog: http://blog.slideshop.com/ pinterest: Slideshop slideshare: slideshop.com phone number: +1 602 559 4554 The world's leading supplier of unique, creative and effective PowerPoint templates. Do you want to customize this presentation? Download the PowerPoint file. Download

×