By Ravi Dhar


Marketers increasingly mold their work around the customer experience. They manufacture rich, immersive interactions, carefully crafted to resonate with consumers. A 1998 Harvard Business Review article on the ‘experience economy’ noted that “experiences are a distinct economic offering.” Quite simply, the argument runs that delightful customer experiences add value and build loyalty.

And yet many companies find that objective improvements to products and services, which are central to experience, don’t translate into customers or revenue.

The fact is, renovating experience is insufficient, because how we perceive an experience depends deeply on our beliefs and intuitions. Relabeling a $10 wine from New Jersey as a $100 Bordeaux will—surprise—dramatically improve opinions of the flavor. And even though cruise lines over the past decade have reinvented their offerings, with interesting stops and adrenaline-rich activities, many people refuse to set sail because of perceptions about life on-board—nothing to do but sip daiquiris and wait for sunburn.

People make initial judgments based on intuition, which “tirelessly provides us with quick impressions, intentions, and feelings,” in Daniel Kahneman’s words. These quick judgments then modulate how we experience something; however good they taste, low-fat and low-sodium snacks will always rank below their conventional counterparts because of consumer preconceptions. So, before shaping consumer experience, marketers must first ask how they can create new beliefs. Behavioral economics has something to say about this.

People will judge a book by its cover. Despite aphoristic hopes otherwise, appearance is a powerful force on intuition. Make credit cards with a visible security chip, and people will feel more secure in their transactions. Attach a silk ribbon to a shampoo bottle, and bathers will perceive it to be their hairs’ silkiness. The details of presentation can trigger positive or negative beliefs, and these beliefs will shade consumer experience.

Add new ingredients, and get the name right. When people are snacking, they often want something nutritional and energy-rich. A single word can alter beliefs about a product’s suitability. Mention the protein in oatmeal and Greek yogurt, or the dose of natural taurine in energy drinks. Describe the healthy Omega-3s in canned sardines. Highlighting valuable and trending ingredients helps to positively bias consumers toward the experience.

In the same vein, the name of a food is a powerful, but invisible, forum for shifting expectations. Consumers may not like prunes, but they’ll enjoy dried plums; Patagonian toothfish sounds hideous, while Chilean Seabass ought to be served over a bed of wilted greens. In each of these scenarios, the experience is identical, but the perceptions are not.

Find the right messenger and speak through social media. Beliefs are easier to change if the source is trusted, and yet only 16 percent of people trust businesses, according to the 2014 Edelman Trust Barometer. This is not a good figure for marketers, and this is why consumers discount messages heard directly from companies. Take Royal Caribbean: eager to change beliefs about the cruise industry, they aired TV spots that highlighted on-board surfing opportunities and ziplines, all to the music of Flo Rida—look, teens and twenty-somethings will love us! But the source of the message will mute its persuasiveness. Social media channels offer an avenue for mediating these messages.

Ask consumers to evaluate their experience. Finally, even a surprisingly positive experience cannot alone change beliefs. Research out of the Yale Center for Customer Insights shows how pre-existing beliefs can overwrite the memory of an experience after the fact: if you expect to dislike something that you end up liking, the expectation of dislike is often more memorable than the experience itself. But if you ask people to evaluate an experience that upends expectations while it’s taking place (or soon after), then they will generally update their beliefs and recall the experience much more favourably.

When he was struggling to reel Apple back from the brink of collapse, Steve Jobs said something along the lines of, “Give me a campaign that makes people believe in Apple again.” That was the highest ambition he could have held. The urge to make a better product or service, to enrich experience, will prove fruitless if it runs against an unbelieving consumer.

Ravi Dhar
Ravi Dhar is the George Rogers Clark Professor of Management and Marketing, Professor of Psychology in the Department of Psychology, and the Director of the Center for Customer Insights, all at Yale University. He has been involved in pioneering work in understanding the different factors that influence how consumers think and decide. He has also served as a consultant to dozens of Fortune 500 companies in a wide variety of industries, including financial services, health care, high tech and luxury goods on developing best practices for generating and using customer insights. Ravi has published more than 60 articles and serves on the editorial boards of several of leading marketing journals. The American Marketing Association recently ranked Professor Dhar as the most productive scholar publishing in premier marketing journals from 2009 through 2013. His research and teaching has been honored with various awards including the Distinguished Scientific Accomplishment Award of the Society for Consumer Psychology, the Distinguished Alumnus Award from the Indian Institute of Management, and the Yale School of Management Alumni Association Teaching Award. His work has been frequently mentioned in Business Week, The New York Times, The Financial Times, The Wall Street Journal, The Economist, USA Today, and other popular media.
Ravi Dhar

Latest posts by Ravi Dhar (see all)