Buying more than zeroes and ones

01101000 01100101 01101100 01101100 01101111 or, translated from binary, hello.

For businesses selling digital products it’s all about zeroes and ones, and, of course, dollar signs. For consumers of digital products it’s about instant satisfaction. Forbes’ prediction for the top ten business trends to drive success in 2016 included companies that engage in the Connection Economy (Altman, 2015). This considers that building relationships and connections is valuable, more so than assets created through industrialism. The examples provided of these are the largest in their fields and yet don’t actually own or create anything, eg. Facebook, Uber and AirBnB. And what about Amazon and ebooks? If you think about it, they don’t produce a product, they provide an information conduit, and for doing so they get paid between thirty and sixty five percent of a sale.

Consumer behaviour
Research would indicate that consumers have an increasing amount of control over the market in this day and age, but Broniarczyk and Griffin (2014) outline some of the difficulties that consumers face when making decisions about purchasing products and they largely relate to information. The amount of information available to consumers from a variety of sources can cause uncertainty and add complexity to the decision making process instead of making it easier. And when it comes to ebooks, the amount of choices grows every day.

The consumer process can be broken down into three major steps – pre-purchase, purchase, and post-purchase. A consumer identifies what they want, they research the solution, and create a set of considerations in the pre-purchase phase. Then they move on to the purchase phase, where the considerations have been narrowed down and a provider for the good or service is chosen. After the purchase is complete then there is the post-purchase phase of customer satisfaction, whether they’d be likely to repeat the purchase and possibly generate word of mouth marketing to their friends.

kindle-242594_960_720

Consumers and ebooks
When purchasing ebooks, it would seem that consumers go through the pre-purchase and purchase phase in the blink of an eye, and then spend more time on the post-purchase phase. And because they are likely to purchase in an emotional way this results in an impulse purchase. Kacen and Lee (2002) describe impulse buying as more arousing, less deliberate, and more irresistible buying behaviour compared to planned purchasing behaviour. Maybe they like the cover. Maybe they just heard on Facebook that it’s good. Or maybe it’s only 99c for one more day.  And, you can have it right now. Amazon even has a ‘one-click’ option, where consumers have already provided their credit card details and with one touch the book is purchased.  They get it, and start consuming it, and they start evaluating the outcome.

happy bag shopperIf the book surpasses their expectations, they’ll be delighted. If it meets their expectations they’ll be satisfied. And if it doesn’t meet their expectations, they’ll obviously be dissatisfied. But ebooks are a consumer market. Despite having access to a full blurb, reviews, and even a sample of up to 20 percent of the book, consumers often impulsively skip the research phase and buy the book, only to find they don’t like it. No problem. They just return it for a full refund. Something you’re unlikely to get away with when you buy a paperback.

Why are consumers drawn to Amazon?
Amazon is a brand. It is easily recognisable and trusted. It occupies the largest share of ebook sales, accounting for 74% of all US ebook purchases and 71% of all US consumer dollars spent on ebooks (Author Earnings, 2015). Even people who own Android or Apple devices download a Kindle App so they can buy from Amazon, and if you visit the Google Play Store you can see that the Kindle app has been downloaded more than 100 million times just from them, even though Google has their own e-reader app and ebook store.  If Klaus (2013) is correct, maybe it’s not just Amazon’s frequent email follow up, and post-sales marketing,  but also their ‘useable’ website that makes them so attractive. Klaus describes the useable website as “one that allows visitors to accomplish their desired goals efficiently and simply. Although online customers are not able to physically touch products, they still require assistance experiences to assess products in virtual environments in order to stimulate and manifest their purchase intentions.” If they linger longer in the purchasing phases. But, regardless, ebooks are an experience, so people are buying more than zeroes and ones.

References

  1. Altman, I (2015) ‘Top Ten Business Trends that will drive success in 2016’ Forbes
  2. Author Earnings (2015) http://authorearnings.com/report/october-2015-apple-bn-kobo-and-google-a-look-at-the-rest-of-the-ebook-market/
  3. Broniarczyk, SM and Griffin, JG (2014) ‘Decision difficulty in the age of consumer empowerment’,  Journal of Consumer Psychology, 24 (4), 608-625 [online]
  4. Kacen and Lee (2002) The Influence of Culture on Consumer Impulsive Buying Behaviour JOURNAL OF CONSUMER PSYCHOLOGY, 12(2), 163–176 [online]
  5. Klaus, P (2013) “The case of Amazon.com: towards a conceptual framework of online customer service experience (OCSE) using the emerging consensus technique (ECT)”, Journal of Services Marketing, Vol. 27 Iss 6 pp. 443 – 457 http://dx.doi.org/10.1108/JSM-02-2012-0030

 

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