Stress and uncertainty can impair decision-making. Right now, consumers across North America are experiencing constant disruptions to their everyday life that are leaving them exhausted, overwhelmed and uncertain.
From disruptions to their status quo (the context that influences decisions) to literal disruptions as they are bombarded with notifications and information overload, consumers are struggling. In this mindset, making even simple everyday choices can be challenging. More significant decisions can feel impossible.
Symend’s 2022 report illustrates this current burden of decision-making and its impact on consumer behavior. The weight that people are feeling today as they navigate both big and small decisions can be seen in these consumer responses:
- 66% find financial decisions hard due to economic uncertainty.
- 33% are fearful of making the wrong decision.
- 46% procrastinate or delay making decisions because they are overwhelmed.
- 27% make impulsive decisions.
- 63% who are behind on their bills often ignore service provider messages.
These also highlight a potentially serious threat to relationships between service providers and their customers. But given each customer will experience a unique set of challenges, how can you ease their decision-making burden and help them take positive action in a way that reflects their particular circumstances?
The first step is engaging with them successfully—if you can’t reach them, you can’t help them. Next is reshaping your relationship with them, demonstrating empathy for their circumstances. Fortunately there’s a single approach to achieving both these goals—using behavioral science. This puts a deep-rooted understanding of how and why people make decisions at the heart of every customer interaction. Such understanding enables empathetic engagement that adapts to individual needs.
In this article you will find background, context and a practical guide for using behavioral science to lighten the decision-making load and pave the way to more positive customer behaviors.
Context, challenges and barriers: the vicious cycle
Our recent research highlights how consumer exhaustion, uncertainty and overwhelm —particularly amid the current economic turmoil—are forming and fueling a vicious cycle of barriers to positive decision-making and engagement . Take a look:
- Excessive time on digital devices creates digital fatigue, leaving consumers feeling exhausted, and operating from a state of reduced mental bandwidth before a single decision is even contemplated.
- The combined burden of multiple decisions creates further cognitive overload (decision fatigue). This leads to a variety of behaviors from impulsivity to avoidance, frequently prompting further digital communications from service providers.
- Finally, factor in a scarcity mindset, which can be defined as a real or perceived lack of resources, like time or money. Whether that scarcity is real (I lost my job) or perceived (I’m going to lose my job) it immediately impacts decision-making. A long-term sense of scarcity leads to ongoing fatigue and a declining ability to effectively make decisions.
Consumers feel like they have insufficient time, money or bandwidth to choose positive courses of action. This mental overload is amplified by insecurities about their financial future, which leads to greater uncertainty about any decisions in front of them. This cycle is not only vicious, but self-sustaining.
The root of the problem: the intention-action gap
Solving a problem is a lot easier when you know its cause, and so it’s worth taking a quick look at why consumers are making suboptimal decisions from the perspective of behavioral science.
People inherently want to act in their own best interests—these are their intentions. However, there are often barriers and challenges impeding their ability to act on these intentions. The difference between what they want to do and their actions (or lack thereof) is known as the intention-action gap.
The avoidance or disengagement behaviors referenced above illustrate the gap between a consumers’ actions (e.g. avoidance) and their intentions (e.g. staying on top of their finances).
While the barriers to effective decision-making remain, so does the intention-action gap. This isn’t abstract theory; it’s happening right now—potentially to your customers. Take a look at a couple of key findings from our consumer report:
- 42% put off responding to service-provider messages because they feel unequipped to make a decision.
- 60% feel overwhelmed and anxious when they receive messages from service providers.
Service providers have to understand this volatile, stressed customer mindset and engage accordingly if they are to help their customers make better decisions, more effectively.
Behavioral tactics to support better customer decision-making
The four key tactics outlined below show behavioral science being used to ease the burden of decision-making in a simulated customer outreach.
- Empathy – Establishes that you understand the customer and are there to support them. This is crucial when the customer is carrying a substantial cognitive load.
- Education – Clearly highlights the most immediate action required in order to focus energy on that decision. This helps combat overwhelm by clarifying the first step.
- Reciprocity – Builds brand trust by showing you are partners in the process with the customer. An offer of support (knowing someone has your back) reduces the sense of uncertainty and jeopardy in making a choice—reducing perceived exhaustion.
- Goal gradient – Creates quick wins along the way that provide relief from feeling exhausted and overwhelmed.
The example communication below illustrates how behavioral tactics can be used to guide your customers to better decisions. It’s empathetic, low pressure and easy-to-follow. It speaks to partnership and mutual benefits.
But it’s also just a snapshot, the tip of the behavioral science iceberg.
The real positive power of the approach is that engagements can be tailored to the needs and complexities of the individual customer.
The onus is on service providers to ensure the decision-making process is always as simple as possible. Any information needed from customers, or any steps they are asked to take, must be streamlined and easy to follow. Key considerations that can help the simplification process include:
- Offer a phased approach to providing information required to make a decision or to break down a multi-step decision-making process.
- Reduce the amount of information that a customer has to process at one time.
- Keep pressure or urgency to the minimum level necessary for each interaction.
The way forward – partners in the process
The importance of building brand trust can’t be overstated. Service providers need to be there to help customers once those customers have made positive decisions and taken a desired action (e.g. completed a form or reached out for help). This may seem like relationship-building 101, but consistently demonstrating that you’ve got customers’ backs whenever they need you is the key that unlocks close, lasting relationships.
With the right technology, behavioral tactics such as those examined above can be harnessed at scale by service providers. They can pave the way to positive decision-making across your entire customer base while building loyalty and attaining genuine win-win outcomes.
Download our 2022 consumer report, The Great Shift in Billpayer Behavior, to discover more about what’s driving consumer behaviors. Find out what support service providers can offer customers to overcome the impact of exhaustion and uncertainty, and to engage with them more effectively.