The definition of marketing psychology and how to use it
It’s safe to assume that in order for a marketer to successfully do their job, they first need to understand who the customer is, what they want, and what drives them to make a purchase. If it sounds a little like psychology, that’s because these strategies are based on psychological theories, and are commonly referred to as marketing psychology.
And while marketers are definitely not psychologists, they do use several psychologically-based observations about human behavior to communicate effectively with potential customers and increase conversions on a daily basis.
In the article below, we will investigate what marketing psychology is, five commonly used marketing psychology principles and how to use them for yourself.
What is marketing psychology?
Marketing psychology has been loosely defined as “incorporating a range of psychological principles into your content, marketing, and sales strategy.” Going further, you can also think of marketing psychology as a way to look for patterns in humans and assess how this relates to their purchase decisions.
5 commonly used marketing psychology principles
Reciprocity Principle. This principle is based on the idea that if a brand does something good for you, you are more likely to return the favor, and have increased cooperation in the future.
Information-Gap Theory. This theory suggests that when someone has a gap in their knowledge in a topic that interests them, they will take action to find out what they want to know.
The Scarcity Theory. This idea suggests that humans place more value on the things that they believe to be rare, and place a lower value on what can easily be accessed.
Social Proof Theory. This theory relates to the fact that humans trust products more when they know others who can validate their value.
Loss Aversion Marketing. This theory points out that most people would prefer to avoid losses compared to acquiring gains.
Marketing psychology principles explained
Put simply, the idea surrounding the Reciprocity Principle is that in order to receive sales as a brand or business, you must give to the customer first. This is because psychologists believe that humans are more likely to return a favor or increase their cooperation levels if someone (or in this case a brand) has done something for them first.
So by offering added value to your followers or new customers, you are opening the doors towards a new relationship with them.
How you can use the Reciprocity Principle
In a world where many brands already invest in digital marketing to some capacity, chances are you may already be enlisting the elements of the reciprocity principle. Whether it’s offering free content on your blog, providing your Instagram following with inspirational quotes, or, keeping in touch with your customers through a helpful and curated newsletter once a month, these services provide value to the customer on top of your basic product or service offering.
Image Credit: Glossier, Create and Barrel and French Connection via Medium
First developed by George Loewenstein the early 90s, he believed that curiosity was birthed when people feel like there is a gap between the information they know and what they want to know.
How you can use the Information-Gap Principle
Marketers often use The Information-Gap Theory in content and social media marketing. You can see the theory used in the way publishers write headlines as questions. Chances are you’ve seen headlines that start with phrases like: “How To...” or “The Secret Trick To…” or even, “The One Hack..”. These headlines are used to pique our curiosity and want to fill the knowledge gap by clicking into the story.
Writing tip: It’s worth noting that this trend taken too far can become known as click-bait, and many publishers are trying to steer away from misleading headlines that don’t match the intent of the article.
With social media, brands often attempt to steer followers towards their homepage in order to increase traffic. Whether it’s attracting followers to the latest sale or news story, you’ll often find brands use a vague selling point on Instagram Stories with a “Swipe Up” to find out more information about a sale, or an exclusive offer.
Entice your followers with these minimal and bold Instagram Story templates.
Psychologists believe that humans place a value on things that are harder to obtain. According to Shahram Heshmat, we can think of scarcity in a positive way because it “orients the mind automatically and powerfully toward unfulfilled needs.” Scarcity marketing is where consumers fear that they will miss out on what’s on offer, thus losing their freedom of choice.
Some of the ways marketers use this idea can be through:
Black Friday sales. Originally, Black Friday was the name given to sales that took place the day after Thanksgiving. However, it’s fast becoming a global trend that attracts bargain hunters around the world. For decades retailers have managed to create a sense of scarcity around highly-discounted, popular products leading to empty shelves—especially during the holiday shopping season.
Limited product offering. Ever gone in search of cheap flights, only to see that there are 3 tickets left? By seeing that there are only a few tickets left, you’re likely to make more of a swift decision with your purchase, compared to if were 300 tickets left at the sale price.
Exclusive access. When it comes to upgraded membership options, brands are able to make their product offering feel premium and exclusive. Whether it’s VIP access to a special service or being given extra features in a product, having access to something that isn’t readily available to others allows customers to feel like they are in possession of something scarce, and thus special.
Increase awareness on your next big sale by setting promoting it on your Facebook Banner.
Social proof marketing
Professor of psychology and marketing, and author of Influence: The Psychology of Persuasion, Robert Cialdini, believes that when humans are unsure what to do, they look to those around them for advice on what should be done.
Social proof marketing goes one step further than simple word of mouth. Instead, it calls on the persuasive powers of experts, celebrities and user reviews as a way to increase our trust in the product or service. And the digital age has amplified the power of Social Proof Marketing to new heights.
Below are other types of social proofing you can try when trying to promote your business:
Use an expert. Experts have spent countless hours perfecting their craft and becoming an authority in their specific domain. And so, when they promote or are seen in association with a product, it’s likely that followers who have that specific need, will listen to their recommendation.An example of expert social proofing could be hosting a live Q&A on your Facebook page, or getting that expert to write a guest post on your blog.
Have a celebrity endorse your product. When it comes to endorsing your product, or service, celebrities, and social media bloggers hold influence amongst their large followings.An example of endorsements that many brands use is to enlisting A-list celebrities for a campaign, or simply gifting your product to an influencer that holds power in an audience that you would like to target and hoping they feature it on their social media profiles.
Give your users a voice. Often, the best marketing is an organic word of mouth. Whether it’s a Google review or a five-star rating on the app store, the truth is, many soon-to-be customers use these recommendations as a guide for the true performance of your business. Research shows that 91% of people regularly or occasionally read online reviews, and 84% trust online reviews as much as a personal recommendation.
When it comes to spotlighting positive reviews, many brands have dedicated pages on their website, or use them in social media marketing.
Certification. Whether it’s a health rating, a Trustpilot rating, or the famous blue tick on Instagram, official accreditation is any easy way to give your first-time customer piece of mind.
Loss Aversion Marketing
Nobel Prize-winning psychologists Daniel Kahneman and Amos Tversky discovered Loss Aversion during their research on Prospect Theory. In short, Daniel and Amos found that people seemed to value avoiding a loss more than accessing an equivalent gain.
Marketers use Loss Aversion Marketing on a regular basis—just think of how many “last chance to buy” emails you have received in your inbox?
While this can prove to be an effective strategy, the internet has meant that many users get flooded with this style of marketing, and thus if not done properly, it can have a detrimental effect.
Some Loss Aversion Marketing strategies include:
Trial offers. Research tells us that we value items we own more than those we don’t. And so by offering your customers the opportunity to own the product—even if it’s temporary—you are allowing them to potentially feel the loss of not owning the item.
Creating a limited resource. One way to entice customers into making a purchase is to inform them of the scarcity of your product. Commonly used in e-commerce businesses, brands often create a certain amount of stock and let the customer know if there’s only a few more available.
Offering a gift with purchase. Whether it’s free shipping, a discount code when a customer spends a certain amount, or free gift wrapping, the idea of losing a free gift can often serve as a strong incentive for convincing your customers to make a purchase that they were originally on the fence about.
How to incorporate psychology into your marketing strategy
While it can be appealing to try and utilize all the marketing strategies listed above, when assessing how you can implement marketing psychology into your strategy it’s best to first think about the business you work for, what best suits your existing strategy and what data says about who your customer is.
In conclusion, leveraging psychology in your marketing strategy is a great way to get your brand noticed in a sea of competition. It will also help you define what is the most engaging way to communicate with your customers.