The Heart of the Magnanimous Field of Egonomics - Assignment Example

inserts his/her full Egonomics At the heart of the magnanimous field of Egonomics lies the belief that ego isn’t necessarily bad. Authors of various books have compared Ego to free radicals in the human body. Just as free radicals aren’t harmful (and actually work for the benefit of human body) when in moderation, ego too has the property of enhancing individual’s confidence when in moderation. Since human beings have the tendency to boost their ego through whatever they consume, Egonomics is a trend that has evolved over the years whereby humans as consumers demand personalized attention in the depersonalized information age. The nature and pattern of human consumption has evolved significantly over the years with a significant move away from goods produced under mass production (initiated by the car maker Henry Ford) towards specialized production and finally customized production. It is not surprising that the focus of many companies today is no longer just the provision of an exceptional quality product or service but one which caters to niches and has the capability of being adapted as per individual requirements of the customer. In other words, personalization and the creation of unique customer experiences has become the new source of gaining competitive advantage in the midst of largely undifferentiated products and services. To set themselves apart from the crowd, consumers are increasingly flocking towards products that others do not have. This is because, as humans, our behavior is more often “irrational” than rational and that various purchases cannot be explained in the light of aesthetics, utility of performance. In other words, the fact that most of engage in building and sustaining our self-esteem and self-confidence means that we often pay a price much higher than the actual worth of the product just for the sake of its exclusivity or limited availability. One such example is that of the recent launch of limited number of exclusive Apple iPhone 24 carat gold handsets that cost a fortune ($2853) to consumers (Trivedi).The pricing reflects the exclusivity of the product which, most consumers may find as a cushion to their self-image. Similarly, the LeBron James Limited Edition watch by Audemars Pigue is designed to cater to enthusiasts who would like to own this $51,500 watch (Adams) as a status symbol and to set them apart from the crowd. The high price reflects the (monetary) worth of the owner/consumer which is consistent with psychology that suggests that human beings are prone to engaging in impression management or casting favorable impressions of oneself in the society. Furthermore, considering that humans have imperfect knowledge about themselves, they constantly strive for feedback from others (through praise of appreciation) to boost their perception of themselves. An example is of a customer who is praised by his friend for wearing a $51,500 watch and who receives increased attention from others by virtue of this valuable possession. This can be referred to as “personal branding” or differentiating yourself from other brands or individuals. In other cases, the same may be considered as a “requirement” as per social benchmarks (Benabou and Tirole). For instance, an individual attending high profile dinner of delegates may consider it as a disgrace to his self-worth to wear anything less than a custom-made designer outfit or designer shoes. Keeping these trends in view, it is no wonder that companies are looking towards the personalization of their service offerings as well. This is commonly known as one-on-one marketing or micro-targeting whereby promotional tools such as the e-mail, internet, direct mail, special events and others are used to target customers with specific psychographic profiles or lifestyles. For instance, HSBC posted banner ads on its websites that were highly personalized meaning that the bank offered special “offers” depending on the account balance of the customer and the content accessed (Smith and Zook). This increased the response rate by 88% (Smith and Zook). Considering that consumers are looking forward to doing business with companies that effectively “break the clutter” and offer personalized services, personalized services such as these enhance relationships between the company and customers. It not only enhances their sense of self but makes them feel valued and a sense of ownership in the product/service. As states by one of the authors, however, ego when heightened to excessive levels can prove to be threatening and can deliver negative consequences. Therefore, companies must exercise caution when offering personalization to customers. For instance, the practice of greeting each customer in person by American Express was a big disaster when customer became furious of being greeted personally (Smith and Zook). Even though the company could immediately access the customers’ details by virtue of their customer relationship management software, it was not an appropriate strategy for customers who resented such individualized service. At other times, offering customers a chance to design their own products can prove to be a disenchanting strategy. For instance, Nike’s refusal of having “sweat shop” written on one of the customized shirts led to negative publicity , thereby defeating the very purpose of such a personalized service (Smith and Zook). Furthermore, the advent of the internet technology and features such as “cookies” allow companies to cater to the individualized needs of most customers. Technology must, therefore, be considered as a key driver of Egonomics. Also, it becomes of primary importance for companies to apply their knowledge of their customers. Considering the plethora of information available on the internet, the average consumer has a hard time filtering the information most relevant to him/her. However, with cookies that track the online customer’s data and search findings, personalized ads may be presented to users. For instance, one of the consumers opting for online booking of a flight discovered online ads of the same hotel she had been searching for (Macomber). It is also common to find the ads of an apparel brand consumers searched for on facebook pooping out of nowhere. Such strategies help businesses connect with the consumer who is thirsty for ‘relevant’ and specific information as opposed to that information which he/she may not be interested in. Therefore, the trend of Egonomics is actually generating the trend towards ‘retargeting’ in the online world whereby companies target internet users who have already visited the company’s website while following other ads (Macomber). The AIDA model is conveniently put to use by such trends whereby consumers who display the “desire” to purchase the company’s products but have reverted may be pulled back to the company to incite the final “action” or purchase (Macomber). To conclude, the desire to draw attention towards oneself, enhance one’s self-esteem and support one’s ego leads customers to withdraw themselves from mainstream products and services and move towards individualized offerings that appeal to their unique identities. As seen earlier, technology has been playing a critical role here with tracking of ‘cookies’ making way for more personalized ads to approach consumers. Furthermore, the markets for niche products such as special edition watches or luxury phones exist for the very purpose of social benchmarking as well as personal branding. Considering the variety of options available to most consumers today, it is not surprising that breaking the clutter and protecting one’s individual identities has become critical. Companies who charge exorbitantly high prices for such customized offerings capitalize on this characteristic of consumers and understand that targeting ‘niche’ segments is more profitable than undifferentiated segmentation. Therefore, given the importance of this trend to both consumers and firms, one can easily anticipate Egonomics to gain momentum in the coming years. Works Cited Adams, Ariel. "Forbes." 27 September 2013. You Can Now Buy The $51,500 LeBron James Limited Edition Watch By Audemars Piguet. Web. 26 October 2013. Benabou, Roland and Jean Tirole. "Self-Confidence And Personal Motivation." Quarterly Journal of Economics (2002): 871-915. Print. Macomber, L. "Retargeting: Personalized marketing you need to know about." Northern Colorado Business Report 17 May 2013: 18(18):17A-18A. Web. Smith, Paul Russell and Ze Zook. Marketing Communications: Integrating Offline and Online with Social Media. London: Kogan Page Limited, 2011. Print. Trivedi, Sachin. "iPhone 5S Platinum and Real Gold Versions Go on Sale." 25 September 2013. International Business Times. Web. 26 October 2013. Read More