The tech giant has become the most profitable company in the world by developing a loyal base of consumers, who are hooked on its devices and willing to regularly replace them when new models are released. (It now even has a program where you can pay a monthly fee to get a new iPhone every year.)
Now, new market research offers some clues into how Apple gets so many users hooked on product upgrades.
A study that will appear in the Journal of Marketing Research suggests that products that we perceive as upgrades ― even if their features are largely the same as older models ― lead us to make irrational purchase decisions.
The phenomenon, known as “comparison neglect,” happens when consumers favor an upgraded product without stopping to evaluate the one they already own. This tendency goes hand-in-hand with “planned obsolescence,” the production of goods that have a deliberately short lifespan and quickly become obsolete as newer versions become available.
“‘Comparison neglect’ is the name we gave to people’s tendency to insufficiently compare potential upgrades to what they already have,” study co-author Dr. Aner Sena, a marketing professor at the University of Florida, told The Huffington Post. “Although people know that is important to do, they often fail to do so and consequently buy more upgrades than they would have had they followed their own recommendation.”
Sela and his colleagues conducted five studies on more than 1,000 smartphone users aged 18 to 78. In one study, 95 percent of consumers said comparisons were important and 78 percent agreed that “comparing the upgrade to the status quo option is a necessary component in the decision.”
However, the consumers failed to actually make those comparisons between existing and upgraded devices. Indeed, the shininess of an upgraded device seemed to cloud their rational judgment.
“We don’t do as well as we know we should,” Sela said in a statement. “People know this is important; there’s a consensus about it. But, in the moment of truth, we’re susceptible to these biases. That’s the striking thing: Knowing is not enough.”
Sela was surprised to find that even when consumers saw the comparable features of the two products side-by-side, they still don’t factor that information into their decision-making process unless they are specifically told to.
Unfortunately, there doesn’t seem to be much of a remedy for our bias toward upgraded devices over existing ones, as knowledge failed to equate to improved consumer decision-making. The real solution is for companies to take responsibility to market their products accurately, according to Sela.
Don’t hold your breath on that one ― and in the meantime, keep reminding yourself that happiness comes from wanting what you have.
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