Let’s talk about “satisficing.” Though it at first appears to be a misspelling, it’s actually an incredibly important idea about how people make decisions from Nobel Prize-winning economist Herbert Simon. The word is a portmanteau of “satisfy” and “suffice” and suggests that rather than trying to maximize utility when we make purchase decisions, as an economics textbook would traditionally tell you, we instead choose things by setting an arbitrary satisfaction threshold (satisfy) and then trading excess utility for ease (suffice).
What does this mean for brands? In most situations brands are a means to an end, a way to ease the burden of choice we all face in our everyday lives. This doesn’t mean that marketing doesn’t matter in the decision-making process, just that we should assume first and foremost that people are spending way less time thinking about our brands than we like to think they are. Don’t fall into the trap of brand love that so many marketing thinkers are shilling these days.
In fact, I think there’s something much more interesting for marketing strategy at play here. Satisficing says two important things about how people make purchase decisions: they ensure that whatever they’re buying clears the threshold and they sacrifice excess utility for ease of purchase.
If that’s true (which I believe it is), then you could argue there are only two true strategies for marketing a product: You either have to move the bar, or you have to make your brand the easiest to buy. Let’s take those one at a time.
How do you move the bar?
Well, there’s not one bar, so let’s start there. To be a mass product, the bar represents the minimum set of requirements for a category of products. For example, for toothpaste, that involves price (around $3), taste (minty for most) and distribution (do they have it at Walgreens/CVS/Walmart/Costco or wherever it is you buy your toothpaste). For cars, where there are multiple categories, however, the first thing you have to do is narrow down your choices based on use case (compact, SUV, truck) and then price (cheap, regular, luxury). After you choose a category (say, luxury SUV), there are a specific set of requirements that make up the threshold, such as interior fabric or drivetrain capabilities.
If your product can’t hit that threshold for whatever reason, you’re in trouble. Either you’ve got to change your product to break the bar, switch categories or attempt to move said threshold.
That’s the first satisficing marketing strategy. Take airlines as an example. One could argue that Southwest moved the threshold down by drastically lowering their prices compared to other airlines. They believe you don’t have to spend a fortune on air travel, but in order to move the price down, we’ve got to remove a bunch of the requirements that the category typically has, like reserved seats and free baggage. On the other side, when JetBlue launched 20 years ago, they moved the bar up by saying every plane should have cable TV and tasty snacks.This strategy is all about finding a way to move the threshold and make your competition less buyable. In essence, it involves category definition (or redefinition) work.
How do you make yourself easiest to buy?
What about for situations where you can’t, or don’t want to, move the bar? This is where the second strategy comes in: Making yourself the easiest to buy. The most obvious way to do this is to ensure you’ve got distribution in places people are and/or spend a ton of money on advertising to make yourself top-of-mind for shoppers as they’re walking down the toothpaste aisle.
But are there other ways to make yourself the most buyable that aren’t about mass reach and also don’t constitute moving the bar? Again, competing on price, I would argue, is about moving the bar, not making yourself easier to buy. I think the answer here is no.
Obviously there’s stuff like naming and packaging, but changing those can also have the opposite effect, like when Tropicana changed their iconic orange-with-straw-sticking-out to a simple glass of juice. In short, people were not happy about the change.
There’s an interesting argument that some of these new ecommerce plays across every industry are about making things more buyable, but I’d argue getting a mattress delivered in a box or new razors at your door every month are the definition of moving the bar in an attempt to make your category competition unbuyable.
How do you apply these ideas inside your own organization?
It starts with ensuring everyone has a clear understanding of the threshold requirements and a sober take on whether your product currently meets them or not. Hopefully you have already documented those threshold requirements as part of past customer research, but if it hasn’t happened yet get out there and figure it out (and no, you can’t just ask people—you’ve got to go deeper than that). As for whether your product meets them, that should be something everyone already knows: The only question is whether they’re being honest about it.
With that, you should be able to understand where to focus your energy. If you’re clear about the threshold and confident you’re above it, then it’s all about making yourself easiest to buy. The challenge, of course, is that can be an expensive proposition (especially if you’re a small brand competing with big advertising budgets). With that said, raising the bar isn’t a cheap proposition either, as it’s never easy to redefine category norms. The reality is that nearly every brand needs to find a good balance between both approaches, adapting to the market as the competition does the same.