How do you mitigate perceived risk when buying new and unfamiliar products. Consumers experience uncertainty when they are not sure of the outcome of their purchase decisions. This is more common when buying new and unfamiliar products and services, particularly if they are not so sure of the attributes to consider in making a choice.
Marketers need to understand these risk reduction strategies and work to preempt uncertainty by providing answers to the questions consumers are struggling with.
Customers are mainly concerned about functional performance performance, price or value for money, fear of harm and social embarrassment or loss of money. This is what pushes customers to revert to various strategies to minimise risks in the buying decision process.
In this video Dr Cathrine Ngahu presents 7 strategies that consumers use to minimise perceived buying risks and what marketers can do with examples. How small businesses can use this to improve sales, customer satisfaction and retention.
The role of the marketer, or sales person is:
- to provide information that helps overcome the customers concerns
- to answer the questions the customer has
- to communicate in a clear and effective manner.
The strategies consumers use to minimise perceived risk include - searching for more information, buying a well-know brand, seeking reassurance from the company or even seeking social proof.
This video provides examples and shows how small businesses can use this information to improve their customer retention and loyalty.
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