IN THE SPOTLIGHT
Marketing Psychology: 5 Powerful Principles of Human Behavior
Successful marketers know the key difference between strong and weak marketing lies in understanding how people behave and why they behave those ways.
Great marketing doesn’t happen by chance.
Fortunately, human behavior falls into a series of predictable actions and those actions are defined by well-established principles.
Marketing psychology can give smart marketers and business owners a competitive advantage by optimizing marketing strategies and tactics in ways that intentionally and proactively influence people’s behaviors and decisions.
Here are 5 powerful principles of human behavior you should use to supercharge your marketing:
Priming is the process of presenting someone with a word, image or sentence that prepares them to be more receptive to a particular point of view. Priming influences action as well as thought.
Using subtle techniques, you can help people remember key information about your products, services and brand.
And, you can influence their buying behavior.
In fact, it’s possible to prime someone to say “Yes.” This specific form of priming is often called the “foot-in-door” method.
Foot-in-door primes consumers with small asks, such as signing up for a free email newsletter, to prepare them to be more receptive to larger asks, like buying a subscription to a paid newsletter.
Ask people to share comments on social media, read blog posts, attend free webinars or download an e-book before you ask them to buy your products or services.
People feel an obligation to do something for you when you’ve done something for them. This is known as the principle of reciprocity.
- You’re more likely to buy a gift for someone who bought one for you.
- You’re more likely to invite someone to your wedding if they invited you to theirs.
- You’re more likely to buy something if the seller gives you something for free.
Those free samples at Costco are more than just a fun membership perk—they serve as a catalyst for your purchasing decisions.
As a powerful psychological tool, reciprocity helps you grow your business faster. Giving something first can seem counter-intuitive but offering a gift or service without the expectation of something in return can be profitable.
David Strohmetz of Monmouth University conducted an experiment with his colleagues to test the principle of reciprocity. The experiment, set in a restaurant, showed that waitstaff could increase tips by 3 percent when they bring candy along with the bill.
Tips jumped up to a shocking 14 percent when customers were offered two pieces of candy and rose even further (21 percent) when the wait staff delivered a single piece of candy and returned a minute later to give another piece because it had been “such a great table.”
3. Social Proof
Social proof is a psychological and social phenomenon where people are unable to determine the proper behavior and instead, assume that people around them know more about the current situation and behave like the other people.
Simply put, we want to know what others are watching, buying, wearing, and experiencing — which ultimately influences our decisions to do the same.
Consider these effective social proof strategies to boost sales.
- Positive Online Reviews. Amazon dominates e-commerce in part because of its effective use of social proof and customer reviews.
- Customer Case Studies. A case study takes an in-depth look at a client’s experience in working with your business. We frequently share crowdspring case studies that highlight the design challenges faced by our clients, the solutions our creatives offered, and the well-loved end result.
- Trust Seals. Trust seals are a fantastic tool used to reassure a client or prospect that their sensitive information (be it personal, business, or financial) is safe with you.
- User or customer count. How many billions has McDonald’s served? Chances are you know the answer: over 99 billion. McDonald’s has been using numeric data as social proof since the 1960s. The idea behind this marketing tactic is simple: if that many people have enjoyed this restaurant surely, it’s good—billions and billions of people can’t be wrong.
- Customer showcase. You want happy customers and you want the world to know you have them, right? Highlight them and their satisfaction with your product.
We all want what we can’t have. And we flaunt when we have something others don’t.
That’s why zealous Apple fans camp overnight at Apple stores around the world before major iPhone launches.
This is the principle of scarcity.
The psychology of scarcity was famously tested in 1975. Researchers Worchel, Lee, and Adewole wanted to determine desire based on scarcity. Their experiment was simple: they placed two replica cookie jars side by side. They filled one jar with many cookies and the other with only two.
When asked which cookie people would value more, the jar with only two cookies was rated more desirable, simply due to the scarcity. Scarcity marketing thrives on a members-only attitude.
We can observe another example with the structure of Tesla. All Tesla owners drive a Tesla, but few drive the “Performance” versions of the Model Y, Model 3, Model S or Model X. This is a form of exclusivity scarcity, which states that the item may not be short on supply, but instead only an elite few are able to acquire it.
It may seem counterproductive to limit supply, but the buzz created by a lack of supply can significantly boost long-term sales at the expense of lower short-term sales.
People frequently act illogically, making their behavior difficult to predict and customers rarely take the time to learn the full facts before taking action. Instead, people tend to unconsciously latch onto the first fact they hear, basing their decision-making on that fact, whether it’s accurate or not. This phenomenon is called anchoring.
The anchoring effect can work for you or against you in marketing. When anchoring works for you, it becomes easier to market your company’s products or services. When anchoring works against you, it’s increasingly difficult to do so. Luckily, there are many ways you can use anchoring to drive sales:
First impressions matter
When a prospective customer first learns about your brand, they hear your business name or see your business logo. Are both unique and strong? It’s impossible to anchor and create an advantage if your prospective customer can’t remember the name of your business or if your logo lacks memorability.
When it comes to website design, if you don’t help people understand in a few seconds how you can solve their problem, they’ll leave your site.
Anchoring can impact pricing
Anchoring has a deep impact on a person’s perception of value – which makes it an essential tool when considering a pricing strategy for your business. The value you assign to a price gives it meaning and helps consumers decide if they are willing to pay it.
Here’s an example: you walk into a convenience store on a hot day looking for a soda. The sign says you can get a 20 oz Coke for $1.79 or a 32oz Coke for $1.99. For just 20 more cents, you can get almost twice as much Coke!
Having anchored that a 20 oz Coke is worth $1.79, that 32 oz for $1.99 suddenly seems like an awesome deal. It doesn’t matter that both are overpriced. So, how can you apply the anchoring effect to how you price products or services for your business?
Here are a few options to consider…
- When setting your pricing, remember that the first option the client sees is likely to be the price that anchors in their brain. So, if your goal is to move your mid-price option, anchor the top-priced item by placing it first or by placing it in the center in a larger font to draw focus. This will make the mid-price option look like a great deal in comparison.
- Want to sell your most-expensive option? Make sure that you set the lower price in a similar range and show how much more value comes with a slightly bigger price. Remember that fountain Coke? How do you say no to a much higher value for a minimal price increase?
- Show a discounted price based on a higher original price. You see this often when someone posts the suggested “retail” price which is crossed out and you’re instead presented with a lower price. Even if the final price is still high, the initial price was anchored and influenced how consumers perceive the actual price.
- Customers can subconsciously anchor to any number – it doesn’t have to be a price. So, featuring any higher number next to your price increases your chance of a sale. Consider showing the number of items sold, the number of customers who have purchased, or even another unrelated item at a higher price.
People do not make decisions in a vacuum. In order to build proper connections with customers and prospects, marketers must understand how people behave and what motivates them to make purchasing decisions. Use these principles to supercharge your marketing.
Ross Kimbarovsky is founder and CEO at crowdspring (Chicago, IL), where more than 220,000 experienced freelancers help agencies, small businesses, entrepreneurs, and non-profits with high-quality custom logo design, web design, graphic design, product design, and company naming services. Ross mentors entrepreneurs through TechStars and Founder Institute, was honored as one of Techweek100′s top technology leaders and business visionaries, and enjoys wearing shorts to work after a successful 13-year career as a trial lawyer. Ross has founded numerous other startups, including Startup Foundry, Quickly Legal, and Respect.