Contextual marketing: a case of cognitive dissonance?

It is perhaps unsurprising that the world's leading coffee retailer (in terms of sales) features "bucks" in its name. For that is what they have always excelled at: making lots of bucks. Starbucks' latest foray at adding to its stack of greenbacks has a teasingly appealing moniker, Geisha. The varietal is a "rare and
bean and is part of the company's growing stack of "reserve" coffees with a price of its "grande" cup retailing at the grand price of $7 a shot.

Starbucks'  expects that despite the price of the drink, which is due allegedly to the limited and high quantity of geisha beans, it will do well as it will appeal to discerning and relatively price inelastic customers.  That marketing notion underlies high end red wine sales as well as, at least at one time, boutique hotel prices; except that both the latter are now in abundance both in terms of geography and content.

Blind tastings have for long tended to give the lie to product differentiation with regard to wines, particularly in the low to middling level. Such was the case with a blind taste of Starbucks coffee, not its much vaunted Geisha, but a regular brew tried on random folks by comedian Jimmy Kimmel as a prank. When asked which was the more expensive (and implicitly better) cup almost all pointed to one of the two when in fact both were identical brews. 

The inability or willingness to go along with marketers' claims about differentiation could be attributed to a characteristic present in all of us, what psychologists term "cognitive dissonance". It
results in people finding themselves doing things that don't fit with
what they know, or
having opinions that do not fit with other opinions that they hold.  It
stems in part from people wanting their expectations to meet reality,
thereby, creating a sense of equilibrium.

 While it may not be as easy to blank out externalities that influence the buying of boutique hotel stays, many of their offerings such as themes that seek to be different end up with a sameness in terms of trying to be stylish in a uniformly aspirational sense.  That often results in the very homogeneity that hotel chains offer; something the originators of the boutique concept rejected and customers sought to escape from.

Underscoring that trend is a 2 + year old move by many boutiques to "affiliate" with a loyalty program. However, what enables the same cognitive dissonance in travelers is the continual and extensive use of the term "boutique" even if it most cases it is a distinct stretch from the original notion that included a relatively small number of rooms. A case of getting what you think you want but really do not want?


Published by

Vijay Dandapani

Co-founder and president of a New York based hotel company for 24 years. Grew the firm to five hotels in Manhattan and also developed a greenfield project at MacArthur airport, New York. Speaker at numerous prestigious forums including Economy Hotels World Asia, Lodging Conference, NYU, Columbia University Real Estate Roundtable, Baruch College's Zicklin School and ALIS. President and ceo of New York City Hotel Association since January 2017.