A Persuasion Tip to Careem
Recently, Careem the car booking service sent me the following text message that include a persuasion tip .
“Free Rides For One Year From Careem! The top 5 users to use promo code “Sana-3alina” till end of March will win free rides for one year from Careem”
Such an offer was no way interested for me as much as their previous one,
“20EGP to any place in cairo! Enjoy a flat rate 20EGP using promo code “Cairo20” with maximum discount 20EGP valid only for limited time”
So, why the second offer outweigh the first one although the total prize of the first offer is much more valuable than the second and what was the persuasion tip here .
Here we need to consider the renowned work of Daniel Kahneman in which he was awarded a Nobel Prize in economics and then he detailed his work it in his bestselling book Thinking fast and slow.
Prof.Daniel Kahneman supported some theories that claim that our brains have two modes of working, system 1 the fast, the intuitive that doesn’t take much time to think and to analyze the information presented; and system 2 the slow, the analytical, that scrutinize the information presented to make the best choice.
Careem’s second offer would employ effectively system 2 as the equation is easy just deduct the 20 EGP from each trip you make, you can immediately calculate how much you’ll save for your necessary “and even the unnecessary trips that you’ll be more eager to make”.
While the first offer contains a bit of uncertain probabilities which is very risky to use with customers as it may blow up your marketing campaign, and this issue was a significant topic that Kahneman discussed in his book. He refuted Bernoulli’s theory which used to be called Utility theory that explains people’s preferences when the offered choices are uncertain, Bernoulli tends to assume that decision weights people set are fixed with regardless the reference point of the wealth people currently possess, so Kahneman modified Utility theory to what he called Prospect theory, where he showed that people’s preferences are inconsistent among same choices, and it all depends on how those choices are presented, and the variety of reference points people currently have persuasion tip.
you can also read When Persuasion Kills!
So, the first offer is vague and hard to reach, system 2 will get fatigued calculating the probabilities of winning, and maybe the recipients of such an offer got variable reference points, i.e. how much they use the service, or how much they would care about that saving option. Even when doing the best to increase the trips one makes at March to get the prize, still the knowledge of how much other riders did ride and how much their closer to get the prize is completely ambiguous, so for sure people will prefer to abandon the risk to over-use the service for the sake of a vague and completely uncertain winning, yet they will prefer to wait for more tangible, clear and certain offer.
One good solution that would make such an offer more attractive is to shortlist the top 100 or 1000 users who use the service at the course of the competition on a daily basis, and to visualize to all of them the amount of riding and the variation of their rankings. By doing so, those top users will have a fervent enthusiasm to maintain and rank-up their positions in order to reach the top 5 lucky winners, and for sure the financial return of the of those 100 or 1000 users would outweigh many thousands of riders who weren’t excited by the vagueness of the contest..
Unfortunate lots of marketing campaigns waste significant amount of cash, because of their inability to influence the behavior of their customers the right and optimum way, modern psychology got lots of answers to marketing guys and service providers that with the least cost paid, a smart campaign can reach the biggest gain.
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