Eager Sellers and Stony Buyers E

Regarding the last week conference, when we were discussing a paper that we were assigned to read
from Harvard Business Review called "Eager Sellers and Hardball Buyers" by John Goureville. There is
a fascinating piece in the June issue of Harvard Business Review describing some recent findings on
the psychology of acquiring a new product (here -- it is available for purchase, or you need to
subscribe). The article covers the psychology of consumers behaviors, and how sellers (or product
designers) can use this to drive sales.

New products cause consumers to change behavior, and this has psychological costs. To understand
why new products do not meet the expectations companies set, we need to dive deeper into behavior
change psychology. All too often, consumers do not buy products companies expected them to
embrace. Until companies understand, anticipate, and react to the psychological biases both
consumers and executives bring to the decision-making process, new products will keep failing.
Companies have long assumed that people will embrace new products that offer greater value or
utility than existing ones.

The products consumers reject are usually ones that actually deliver an improvement over existing
ones. While consumers can get new, highly desired features when they purchase the innovation, they
usually have to forego some benefits from an existing product.
In these cases, companies may either wait until consumers are warming to a product, make
improvements so large that buyers will overcome their reservations, or attempt to kill off the
incumbent. A company may also target consumers that are not already using the incumbents
product.

The trick is to decrease the consumers behavioral changes and/or to improve the value gained from
switching to a new offering. If your new offering has significant product changes from your existing
offering--make sure that these will not be very behaviorally changing. Sellers generally ask consumers
to change their behaviors as little as possible, but to get a big payoff from what the new product or
service offers. Customers are not buying a product, but switching from something else. Favors
prevent people from buying your product, even if it is logically the better option.

It just impacts the quality of your product, which is just one piece of the puzzle. When coming up with
a new product, make sure to keep in mind that something called the endowment effect is going to
create that disconnect between what you want and what your prospects want. It is called the 9x
effect, and it is the core issue of companies wanting consumers to adopt an innovation, but the
mismatch is 9x-1 between what innovators believe consumers want, and what consumers actually
want.

Not only do consumers overestimate losses and existing benefits from entrenched products by 3x,
sellers overestimate benefits from their innovations by a factor of 3. John T. Goureville has said
consumers are overvaluing what they already have by a factor 3, and companies are overvaluing their
innovations, again by a factor 3. Buyers overvalue losses by roughly three times their rates of gain,
whereas sellers overvalue gains by three times their losses.
Together, loss aversion works in concert to cause consumers to price products that they are currently
using at three times their cost. There is also loss aversion, meaning consumers do not want to lose
out on benefits that they get by switching between products, and status quo bias, meaning just what
it sounds like, status quo bias. Overestimation means products that make just a tiny bit of
improvement will not make the cut. Unless gains greatly exceed losses, consumers do not embrace
the new product. This may explain why products such as Color, Facebook Home, and Google Glass
seem doomed not to perform well on a broad market.
The demand of large companies at present for sustainable value capture is essential to the
organizational design for seeing the value to stakeholders. Historically, the demand for the mindset
is the rise of big organizations, which has been in conflict with embracing perspectives from
stakeholders within value development procedures.

Individuals as customers were allowed a choice that no doubt favoured those companies to be
inherently monopolistic, effectively, as witnessed by case briefs on eager sellers and stone-cold
buyers. The authors promoted an idea that, should Eager Sellers And Stony Buyers Case Executive
Summary and other mega-corporations meet civil societys expectations on matters of welfare,
security, health, and the environment, it may provide a good case study to shift the approach
corporations are taking on the international marketplace, namely, do-well--indeed, to do better--by
doing well. It illustrates disturbing results: The dominance of the U.S. of America by massive
corporations like Eager Sellers And Stony Buyers Case Executive Summary has the power and the
capacity to affect the whole pattern and choices of the nations consumption.

Eager Sellers And Stony Buyers Case Executive Summary has the power and the capacity to affect the
whole pattern and choices of the nations consumption. As much as it is a natural fit for us to develop
such a user experience, it requires consumers to embrace a new behavior, one which is still
unmainstream. My exams were in Consumer Behavior, Market Segmentation, Product Development,
and Management. It turned out that I valued knitted bowties way too highly, and that Etsy shoppers
did not see the same things that I did.

Understand that your marketplace is valuing its present solutions over-estimated, as much as you are
valuing your products over-estimated. Companies need to determine where their innovations lie on
a simple yet powerful matrix, as each cell has varying implications on how likely consumers are to
adopt these products, and how long adoption may take.

Cited Sources
• http://www.heavywinter.com/2013/11/eager-sellers-stony-buyers-the-four-progress-making-
forces/ 0
• https://www.semanticscholar.org/paper/Eager-sellers-and-stony-buyers%3A-understanding-the-
Gourville/54f80578c9c0553d675ef7e265e18028d1656433 1
• https://elezea.com/2013/07/9x-effect/ 2
• https://shgww.wordpress.com/2006/07/20/eager-sellers-and-stony-buyers-why-sellers-always-
overvalue-their-products/ 3
• https://medium.com/kennethlng/a-lesson-in-new-product-adoption-7dff3bf40aec 4
• https://www.intercom.com/blog/overcoming-customer-inertia/ 5
• https://girlmeetsyarn.wordpress.com/tag/eager-sellers-and-stony-buyers/ 6
• https://hbr.org/2006/06/eager-sellers-and-stony-buyers-understanding-the-psychology-of-new-
product-adoption 7