Look beyond looks
3 minute read
How many times have we walked into a showroom and observed the attractiveness of the salesperson?
For time immemorial, companies have placed an inordinate premium on looks while hiring salespeople. The effectiveness of this practice (for the most part) has been validated by research where studies have shown that customers tend to trust conventionally attractive salespeople more than their less conventionally attractive colleagues. But are companies reading into these studies too much? The latest research is starting to question the practice of exclusively hiring salespeople based on their looks and proving that this may (in some cases) have a negative effect on the customers.
Researchers came up with a theory that hiring attractive salespeople may be an effective strategy for luxury products and services, however, when it comes to products and services perceived to be utility and everyday items, conventionally attractive salespeople are, in fact, detrimental to sales (as the customers are likely to bargain and negotiate more with someone they find attractive). They attributed this to a ratio called the labour cost to retail price ratio (or LP ratio). They postulated that customers (rightly) attribute a higher salary to attractive salespeople and assume this is being bundled by the company into the final retail price of the product.
For example, luxury products where the retail price is relatively higher, the LP ration will be low compared to an essential item like spectacle frames, where the salesperson’s salary will be a larger chunk of the retail price of the glasses.
To test this theory, the researchers invited a group of students to play an online game simulating a bargaining task.
Step 1 of the game required them to select a pair of eye glass frames from 30 choices.
Step 2 involved the computer simulating a store walkthrough with two scenarios; The first included a traditionally attractive looking salesperson and the second included a less attractive salesperson.
Step 3 required them to play the bargaining game with the computer-simulated salesperson, where they could either accept the price quoted, share a counteroffer or decline the offer and choose not to buy.
After completing these three steps, the participants were asked to answer questions regarding the store atmosphere, the salesperson, and their perceptions of the labour cost to price ratio (LP ratio)
The researchers studied the data and derived a bargaining index by summing, for each participant, the difference between the price asked by the salesperson in the different negotiating rounds and his/her subsequent counteroffer.
When they cross referenced the bargaining index data with the customers responses on perceived salesperson attractiveness and the LP ratio, they confirmed the following:
First, that people who were exposed to the more conventionally attractive salesperson in the computer simulation held a higher LP ratio perception compared to people who were exposed to the less attractive salespeople (thereby confirming the initial hypothesis).
Second, that people who assigned a higher LP ratio had a significantly higher bargaining index than those who held a lower LP ratio
The above findings confirm the initial hypothesis that hiring conventionally attractive salespersons for non-luxury products and services may not only end up costing more from a salary perspective but may also lead to counterproductive outcomes such as more bargaining and a lower willingness of customers to pay.
Food for thought before you conduct your next interview :)
Original research by Apiradee Wongkitrungrueng, Diogo Hildebrand, Sankar Sen, Krittinee Nuttavuthisit
https://myscp.onlinelibrary.wiley.com/doi/full/10.1002/jcpy.1160