Throw caution

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Marketing

When We Throw Caution To The Wind

New research reveals that consumers get a little more carefree with beloved devices when an upgrade is on the horizon

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Did you buy the new iPhone X?

Despite a lot of consumer jawboning about the oddly placed top notch, the loss of the home button, and the hefty price tag, the Internet was abuzz on Friday with mostly favorable reviews and complaints of short supply.

For someone who came of age with the personal computer, I have a love/hate relationship with product upgrades. In the 80s and 90s, technology was too expensive to upgrade with every product cycle. Yet, the tech nerd in me obsessed with rapt desire over the new features and innovations. I was the guy friends mocked for being too much of an early adopter. Today, most of the technologies we carry are designed to be fleeting companions. In fact, Apple (along with many other product manufacturers) has faced minor backlash over allegations of planned obsolescence—a practice of designing products to have a shelf life that guarantees purchase of new models.

While Apple denies any such practice, a new study reveals that a strategy of planned obsolescence might not be necessary anyway. In a paper published in the current issue of the Journal of Marketing Research, a team of researchers from Columbia University, the University of Michigan, and Harvard Business School, found that consumers have a tendency toward risky behavior with their current devices when an upgrade is within reach.

Through a series of studies using real-world replacement data along with controlled experiments, the team found that without being consciously aware of it, most consumers became a lot more cavalier with their use of legacy devices. My favorite experiment in the series involved a Jenga game with a delicate object at risk. Respondents in the upgrade condition were far more aggressive with their plays than those in the control group. Why not? If you break the prize, there’s a better one waiting (even though the upgrade required payment and the at-risk reward was already theirs).

The study also delved into the feelings behind upgrade decisions. I’ll confess that I felt validated to learn that many respondents felt guilty about their desire for the better option even though their current product was satisfactory. This finding is not surprising. I wrote about the risks of consumer satiety earlier this year. It’s a powerful emotion marketers should track and use to advantage. The more satisfied customers become with our brands, the more our brands are at risk—unless, of course, we continue to seduce our customers with dazzling new options.

As pointed out in the study, IKEA is an excellent case example. It is well known that IKEA designs furniture and accessories at a price point that makes frequent decorating changes possible. When you pay $59 for a six-shelf Billy Bookcase (and let’s be honest, we all have or had that bookcase at one time or another) you don’t feel so bad when you have to throw it out because it doesn’t match a new piece of furniture or it doesn’t fit in your new home. Yet IKEA takes the strategy one step further. In its advertising, it encourages people to treat their furniture with emotional abandon. In a Hall of Fame advertisement from 2002, the trendy furniture maker depicted a Pixar-inspired lamp being set out with the garbage, abandoned by an owner who purchased a stylish new replacement. A piano-drenched montage anthropomorphizes the orphaned desk accessory until a man walks into the frame and says, “Many of you are feeling bad for this lamp; that is because you are crazy! It has no feelings, and the new one is much better!”

The ramifications are insightful for anyone who manages a product that frequently changes. Whether you’re a restaurateur or a gadget-maker, your task is to help your customers feel better about making the change. Help them overcome feelings of guilt. Give them good reason to justify their decision. Sometimes, this justification can be altruistic, as when H&M launched “Long Live Fashion,” a donation program to “reduce waste and give old products a new life.” Sometimes, you need only appeal to their human desire to have the best and indulge in the latest trends.

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