Those of you who know me personally probably know that I’m fascinated by the psychologies (or in simpler terms the brain processes) which guide people to make decisions in general and buying decisions in particular. Having made many seriously flawed commercial decisions (the demise of Subjective Audio being a case in point) I strive to make better quality decisions in everything from which brand of tea to how I relate to friends and family.
The problem of course is that the word “quality” is fraught with complexity within the context of decision-making. I’ll get to the point about audio shortly, so please bear with me on this.
It took my some years to get back on my feet both emotionally and financially after the demise of Subjective Audio. Anyway, being preoccupied with how I’d come to make such a catalogue of poor decisions, through a long and pleasantly (in the main) serendipitous route I came across a remarkable man – now deceased. I felt he was an apostle and I happily became his disciple. You can read about him HERE.
To cut a long story short, his beliefs caused me to co-found Cognisco – an IT company. I was head of innovation and the design team was led by my son David. You can read about one of my patents HERE.
One aspect of my investigation into how rationality and objectivity can be applied to decision-making in general and decisions about buying in particular led me to be made aware of the 6 common human errors in decision-making.
I'm envisaging that in early 2015, once a week, for 6 weeks I’ll post my thinking about one of the 6 errors. I invite comments on this if you feel inclined.
Before stating the first of these 6, it’s worth remembering the stages that lead up to the decision to purchase or not:
- Decision to upgrade or not from an existing piece of equipment
- Decision as to where to get background info e.g. friends, magazines, web-sites, etc
- Decision as to which information you choose to let influence you
- Decision as to what products should go on your short-list
- Decision as to what dealers to visit who stock your short-listed products
- Decision as to which if any of the dealers you are going to make a purchase.
There are in fact many other sub-decisions in the progress you are probably not conscious of.
So, here is source of potential error #1
The Halo Effect:
Common observations of people’s behaviour, both at work and in everyday life, suggests that most individuals possess both appropriate and inappropriate audio experience, beliefs and prejudices. This is reflected in the way that decisions are made about equipment and dealer short lists.
The individual piece of equipment and/or dealer who is superior on all favourable characteristics is extremely rare as is the equipment and/or dealer who has no redeeming features.
Yet research evidence indicates that buyers frequently perceive brands, equipment, dealers and so on via the information available through magazines, internet, friends and colleagues in these black and white terms. I’m guilty of this too I have to say. Less so than I was, but I’ve yet to eliminate it completely.
Brands, dealers, magazines, reviewers and equipment tend to be judged as all good or all bad.
This halo effect is particularly likely to occur where a piece of equipment has a single outstanding characteristic revealed in the demonstration. For example, if say a preamp is unusually high on one attribute (bass transient or ambience, etc), listeners and buyers typically tend to minimise or ignore any weaknesses they hear in other areas of that preamp’s performance.
I’m not a Naim dealer, but some of my customers who own Naim have commented to me that while they were and remain impressed by the undoubted rhythm, pace and ‘bounce’ of the Naim sound, they felt in comparison to sounds they had heard at other dealers (although not me) that characteristic Naim sound was a bit ‘murky’ in the mid range.
Whether this is indicative of succumbing to error #1 is open to speculation.
This is just an introduction into one of the 6 errors. In isolation, it might not seem much. But just stop to consider if at some point in your audio career (or anything else where you had to make a decision about say digital cameras, cars, partners for life and so on) you fell into this. And then ponder on the consequences.
As I write this, I’m glancing at the classified ads section of Hi-Fi News. It’s packed with private sale goodies at bargain prices. From one perspective, it’s a treasure trove. But just consider the cruel reality underneath. Most of these people offering current state-of-the-art audio equipment at serious financial loss to themselves clearly made wrong buying decisions. This suggests 3 key questions:
- What to do about it?
In a future post, within the next week I hope, I’ll be offering practical, sensible and uncomplicated techniques to reduce the effect of this first of the 6 errors when you are in a dealer demonstration.
One thought on “BECOMING A SHREWDER HI-FI BUYER: Part 4”
Very tantalising start to your series. I look forward to reading more.
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