Tuesday, 10 August 2010

New column on Nu Zakelijk: Choosing simplicity

I wrote a column on Nu Zakelijk for my employer: Logica. It's a combination of the Paradox of Choice (prof. Barry Schwartz)


and the Power of Free (Dan Ariely).


Both are very interesting concepts and linked to previous pieces I wrote on the greatest ISP in the world and why all telecom marketings and product management is messed up. Here is the Google Translation for those of you who think Dutch reads and sounds like a form of Klingon.



Choosing Simplicity

Released:August 10, 2010 8:39
Last edited:August 10, 2010 8:39

Simplicity can be very rewarding. Disappears as the stress in consumer choice and cost savings a business organization.

By Rudolf van der Berg | Logica
It seems that almost every town now has an "unlimited meals" Chinese-Japanese restaurant . The principle is simple enough, the customer is free to take from an unlimited buffet or ordering the dishes on the menu. There are some rules: drinks not included and a fine for food left over.
The choice of customer options are reduced to a choice: do we eat here tonight or not. Yes, there is also a choice of dishes, but the choice for one another court does not. It is this limited choice that the formula for other interesting businesses.

Choice

Choice seems good. Any marketer can you explain, you have your product in order to segment all product-market combinations to serve. An ideal marke produces for every consumer  the ideal product.
This requires not only a producer who knows what his customers want, but also a customer who knows exactly what his needs are and which supplier can meet these. And there lies his problem: many customers are not happy from a multitude of choices.

Satisfied

Scientific research shows that if a customer gets a lot of choices, the customer is less satisfied and chooses less . The paradox of choice that customers experience a stress choice and that choice stress leads to dissatisfaction with the choice (what else) and even to completely postpone a choice. (For a more detailed explanation, see this amazing video of Professor Barry Schwartz at TED).
That limiting choice in other sectors can work well, for example in France shown by ISPs. In the Netherlands can choose between a variety of subscriptions for different prices. The customer must choose between different Internet speeds, unlimited calling or not, or not HD Plus package.

Offer

In France, most, but Internet providers offer a quick internet with unlimited calls to landlines in France and many foreign countries and including HD TV. The customer receives a simple choice and do not go there to think about and thus avoids a lot of stress choice. This simplicity can also be achieved elsewhere.
Is the customer really waiting for a further tiered Internet, energy supply, zorgpolis or mortgage? Probably not. What customers want is, quick-acting and the Internet, a good insurance, stable energy prices and a fair mortgage.
The comprehensive simplicity translates to the supplier not only sell more, but also savings in the internal organization. A customer who is happy with the choice and no choice less stress, call the help desk, looks less at the competitor and the entire back office can be simplified.

Bonus

An extra bonus for the organization to simplify its product offering a choice is the addition of the word free product. By simplifying the supply and simultaneously increase sales in the package, certain elements "free" added to the product offering.
Lets just say one free of the most powerful words in marketing. A product that comes with free items is almost irresistible scientific research shows to see.
Think of a telecom product with free international calls, an insurance policy with free dental visit or a car with free navigation. A simple product with free features, that is what the customer wants.
Rudolf van der Berg Management Consultant for Business Logic Consulting. His work lies at the interface between government, telecom, energy and strategy.Rudolf.van.der.berg @ logica.com LinkedIn / Rudolf vander Berg

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