The Behavioral Economics in Marketing’s Podcast Confirmation Bias on Customer Retention | Behavioral Economics in Marketing Podcast
Jan 16, 2023
They explore confirmation bias and how it shapes customer decisions across the buying journey. The conversation highlights using pre-purchase messaging and post-purchase follow-ups to reinforce customers’ beliefs. Practical tactics like personalized service, automated touchpoints, and repeat-purchase programs are discussed. The role of market research and customer data in designing retention strategies is also covered.
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How Confirmation Bias Distorts Judgment
- Confirmation bias leads people to seek and weigh information that supports pre-existing beliefs.
- This can degrade decision quality, like hiring the wrong candidate or overvaluing credentials.
Hiring Example Shows The Risk
- Sandra uses hiring as an example where employers focus only on confirming evidence like an Ivy League degree.
- That selective attention can lead to bad hires or retaining poor performers too long.
Post-Purchase Rationalization Shapes Loyalty
- After a big purchase people rationalize to reduce cognitive dissonance and confirm their choice.
- Pre-existing positive or negative views shape how customers weight product attributes later.