We love Easter Eggs. In Australia we consume an average of twenty Easter Eggs for every man, woman and child, and that means it's big business for our chocolate manufacturers. But in economic decision making terms, our love of Easter Eggs is irrational. Here's why.
Imagine you visited two different supermarkets.
- The first offered you 100 grams of Cadbury chocolate for $2.98.
- The second likewise offered you 100 grams of Cadbury chocolate, but for $2.15.
Now imagine you are within one of the supermarkets and they have two offers;
- The first is the same offer you took above, 100 grams of Cadbury chocolate for $2.15.
- The second offer is an Easter Egg. 100 grams of Cadbury for $2.98.
|Block chocolate vs Easter Egg|
We are greatly influenced by others around us. Indeed, that we even have such things as Easter Eggs is a social construct. To give your child a block of chocolate is just not the same as an Egg. As consumers we justify the economic irrationality by deferring to such emotional reasons as the magic of an Easter Egg hunt, smiles on faces etc. And as marketers, that's what we aim to amplify so that our Brands have a reason to be purchased outside purely rational reasons.
And this is a key thing about explaining Behavioural Economics. All those reasons for paying more can be cited by the consumer as entirely rational because we are great at justifying our decisions. But rationalised isn't the same as economically rational. Why is this important? When you next pitch a product or campaign for development, remember it's not just about the 100 grams of chocolate. It's the shiny foil, the social construct, the timing, the gifting, the emotion that your customer will be processing when they are in your aisle. Get excited because if you can help your consumer rationalise their purchase, the economic rationalisation becomes moot.
And this is the massive opportunity Behavioural Economics presents to marketers, product managers and retailers. Yours is the opportunity to turn the magic of irrationality into margin for your business. So tell me, what's your Egg?
Prices quoted from Woolworths, Moorabbin 8 April 2011