Social and Informational Inferences

Consumers are constantly gathering, and exposed to, information that shapes the way they evaluate goods, form preferences, and infer preferences. Often, others, such as friends, partners, salespersons, managers, and marketers have a choice to present information to consumers, and in what form they would like to present the information. A marketer might decide whether they want to publicize the results of a blind “taste” test between their product and a competitor’s product, and if they do, whether they want to present the ratings of each product or the percentage of respondents preferring each product. A friend might be asked what their preference is among several options over which a consumer is debating purchasing one, and in their response, must decide how to express their opinion. A retailer might decide whether they want to inform consumers of the quantity remaining of a good, and if so, how they should highlight this scarcity information. In all these cases, consumers are likely to instinctually draw inferences from the information they learn in order to help them make better decisions. Across the three chapters below, I explore these inferences, if they are accurate, what drives them, and the consequences on consumer choice.