One of the theories in behavioural science which supports the idea that we’re not as objective as we like to think we are, is the expectancy theory. 

It’s an important one to understand in retail and hospitality industries, so we can try to understand what customers expect and how we can meet this. 

The following is an excerpt from the first chapter of our new book, Atmospheres That Sell - Using Behavioural Science To Create Branded Atmospheres in Retail & Hospitality. 

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Overview

Have you ever heard of a placebo or the placebo effect? It’s one of the few biases that’s fairly well-known amongst ordinary folk. The placebo effect is essentially having a true, lived experience of something in the way that you’d expected, even when objectively not possible. The most common focus of this is with medication - the idea that you could take a placebo tablet and still experience a degree of the related target experience. Pain relief, for example. This is, in effect, the workings of expectancy theory - that what we experience is strongly influenced by what we expect to experience.

Let’s talk about Red Bull.

Red Bull, for all that it tastes funny and is comparatively expensive, is a hugely successful and popular energy drink. Often served with vodka, it is the ‘go-to’ for many young people to get them drunk and energised in one quick punch. And over the years, the branding has been so powerful that it has a potency that can only be reached when you know that you’re drinking it. 

The placebo effect of Red Bull was tested in 2017 by INSEAD and the University of Michigan. They gave three groups the same mixed drink of vodka, Red Bull and fruit juice. The three groups were given different labels for the drinks, with only one group knowing that Red Bull was in the drink. They were then given a set of tasks to complete and an interview. The results are surprising - the group that knew that they had consumed Red Bull reported feeling 51% more drunk than the other groups, took bigger risks during a gambling task and were more confident.

All of these effects were, as you might expect, stronger in those participants that had a strong belief in the product's abilities. Director of the INSEAD Sorbonne Behavioural Lab, Pierre Chandon, said, “Beliefs that people have about a product can be just as important as the ingredients of the product itself.” That’s right, Pierre, or put another way, you’re more likely to experience what you expect to experience.

There’s a similar, long-term debate over the preferences for Coca Cola and Pepsi as the taste preferences change based on whether a participant knows which brand it is or not. Well, actually, that’s not strictly true. This has been tested numerous times and each time, there is little effect in knowing that it’s Pepsi, but Coca Cola’s brand had a substantial positive effect on reported taste and experience. So, not only does the brand dramatically change and influence a potential customer experience but also, it can leverage you dramatically against competitors if you do it better.

This isn’t just a matter of spending millions on branding though. The same effects can be seen in much smaller and isolated instances. Researchers Piqueras-Fiszman and Spence studied how cutlery, dishes and other inedible elements of a meal can alter our perceptions of taste by acting as a "mental seasoning" for a meal. In their 2011 study, people rated the exact same yoghurt as being 15% tastier and more expensive when sampled with a silver spoon rather than a plastic spoon with a metallic finish. The same researchers also found that combining a heavier bowl with a heavier spoon further enhanced perception of tastiness.

And it’s not only how good the taste was that was found to be impacted. Piqueras-Fiszman and Spence’s research also found that the shapes of plates, for example, impacted people’s recollection of the flavour, with plastic packaging or plateware that's more rounded tending to emphasise sweetness, and angular plates being perceived to bring out the bitterness in food. What’s happening here is that, rather than a brand leading the way, people’s preformed expectations on what they’d expect to eat from was the given serving set-up - foods eaten with a heavy silver spoon are normally fancy and therefore taste better, was the expectation that took over.

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Win twice with expectancy theory

In all of the examples above, the common factor is that the expected trait of a brand or presentation has been built up over time. So, the best time to start working on expectancy theory is, as they say, ‘yesterday’. The reason is that each experience a customer has with you will be used to gauge what they expect in the future. There’s no distinction for them between a bad drive-thru experience and a good dining experience, or a great shopping atmosphere and an unhelpful member of staff in the changing room - it’s all the same when it comes to brand perception; the lens through which future experiences will be observed. 

Consider it as your customers learning what to expect from you, built up over time. The best analogy for the way to understand this may be a drop of water running down a hill. At first, it’ll take random paths down, but over time as each new drop begins its journey, a path will start to form. Soon, the route is clearly defined and not much will cause water to defer from this path. Once it’s established, your view of a brand will take larger and larger ‘debris’ to change your rehearsed expectations.

The double-win here is that if you manage to create a fantastic customer experience in your stores, not only will it more likely become the experience your customers feel like they received, but also it safeguards you against anytime you didn’t quite hit the mark. The curation of a perfect atmosphere is always susceptible to hiccups, but as long as you’ve put in the work to imbue your customers with the ideal experience, you’re far more likely to be unscathed if on one occasion you don’t quite deliver. What’s important here is a meaningful intention to create the same experience each time, but not just any good experience.

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Consistency is critical

When it comes to building world-class customer experiences that use expectancy theory to supercharge the impact, it’s important to remember that the experience has to be (1) very positive, and (2) consistent. Rather than working on broad approaches to customer experience, it would be much easier to focus on a few key areas that you can deliver on (and are distinct to your brand). Much the same as building a map of the peak-end rule, I’d recommend that you build a similar plan to all the potential touchpoints with your brand that a consumer may have and make sure they are consistently positive in the same branded way. The brain is a pattern recogniser and it’s these patterns that help to build a strong expectancy, so making sure you replicate as much as possible is the best tactic here. With good tech, this shouldn’t be as hard as it sounds. It’s a matter of deciding what your branded deliverables for the expected experience are, and then replicating these over your touchpoints.

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Want to know how to start implementing the expectancy theory? Check out the world’s first behavioural science book specific to retail and hospitality, head here.