Framework for Changing Consumer Behavior

Last week, I wrote about the five factors that influence consumer behavior. The logical next question is how to use these factors for changing consumer behaviour. This article answers the question and my way of ensuring that we are discussing practical ideas here. 

Using the 5 Factors for Changing Consumer Behavior

As a brief reminder, the five factors for changing consumer behaviour are self-interest, barriers, perception, demographics, and culture. You don’t have to tap into every single factor change how consumers behave, but the more you use, the more likely you will get your ideal outcome.

Let me give you an example that is taking place as I write this. COVID-19 is forcing all countries to adopt restrictions. Wearing masks, staying six feet apart, and avoiding people when you’re sick come to mind. Some of these restrictions are controversial, but here’s how Starbucks is leveraging the five factors to change consumer behaviour:

  • Self-interest: telling consumers that they don’t want to get sick or risk getting someone in their family sick
  • Barriers: providing masks for anyone who doesn’t have them and preventing people from entering their stories without a mask.
  • Perception: if you follow these restrictions, you’re doing your part for society.
  • Demographics: when talking to young people, they use hip language and actors. Older people get a slightly different message.
  • Culture: everyone is doing this, and you should do your part to fit in. 

Trying to tap into these factors is more effective than just yelling at people, which some governments seem to be doing. They are trying to shame consumers into doing a particular action and hoping it works. While shaming could be an element of the “culture” factor, I don’t think it is strong enough on its own.

Let’s look at another example of how companies use these factors to change behaviors. Social media companies have fundamentally changed how we live our lives. We now spend hours on the major sites and have even replaced moments of boredom with social media moments. This is how they tap into the five factors:

  • Self-interest: you can find out what your friends are doing, laugh at funny videos, or connect with family.
  • Barriers: Simply unlock your phone, open the app, and you’ll get the latest updates.
  • Perception: products like Instagram and TikTok are entirely free, and yet they provide a high level of value and entertainment.
  • Demographics: advertising is geared towards young people and how fun it would be to be on social media.
  • Culture: all your friends are on it, so why aren’t you?
Trends in TikTok
Trends in TikTok

Social media companies didn’t tap into all the five factors from day 1. Instead, they slowly worked on adding more factors, and now there’s a self-perpetuating effect that keeps consumers locked in a specific behavior.

As a business, you should be thinking of how your products and services take advantage of the five factors and what you could do to make them more sticky. Having customers who love your products is excellent, but having customers who associate your products with fundamental behaviors or emotions like boredom is even better.

The Elephant in the Room: Changing Consumer Behavior Due to COVID-19

There’s an elephant in the room for changing consumer behavior, and I need to address it. We are currently seeing it as COVID-19, but we can think of this elephant as external forces. An external event like a pandemic is forcing widespread changes in how consumers buy and engage with companies. How does an event like this fit into the five factors?

The reality is that it doesn’t. Societies are complex ecosystems that are always changing and evolving. We can’t control these changes, and apart from short trends, we can’t predict them. We can, however, ride them.

Once we see a trend such as consumers wanting safe choices for buying products like no-contact delivery or environments large enough for physical distancing, we can figure out how we can use them for our business.

This is where innovation plays a role, and we can create new products or ways to serve our customers. The key here is spotting the trend early enough and then using it to change how our organization operates boldly.

Apple has done it incredibly well. They weren’t the first to most of their dominant categories like the iPod and iPhone. They jumped on an early trend and worked to deliver the best product in the category. 

Futurists in a Room
Futurists in a Room

You don’t need to lock your people in a room and try to predict how the future will unfold. You simply need to look around and see where the future isn’t “evenly distributed” as William Gibson once famously said.

Remember That Change Can Take Time

One final point to make here. Change can take time to fully occur, especially if you’re looking at a broad group of consumers. Unexpected events like COVID-19 can put things into hyperspeed, but these events are. 

Don’t worry about the speed. Instead, focus on getting better regularly. Stay agile and willing to jump on an early trend. 

Changing consumer behaviour is hard and takes time, but companies can systematically approach this task. Remember the five factors and how you could play with them to design strategist and new products.

One more thing before you go! Do you know how to get more insights out of your data? 

All companies are sitting on a goldmine of data that they haven't fully explored. It's not about technology or capturing more data. The key is to learn how to make the most of your current data and convert it into actionable insights. This is the main idea behind my first book, The Data Miage: Why Companies Fail to Actually Use Their Data

I'm excited to announce the release of the book through all major retailers. If you're interested, you can download the first chapter for free using the form below. You'll learn what the best data-driven companies do differently and how to make sure you're playing the right data game.