Our culture has shifted dramatically over the past couple of decades to a consumption machine. People are buying and consuming more than ever before. One study from Psychology Today links impulse buying in general to the personality of the person, the pleasure from buying something new, and (here’s the big one) their connection with the brand.
As an entrepreneur with a product to offer, you want to reach as wide of an audience as possible. In order to achieve your goal of making it big, you have to understand buyers and how psychologically can drive people towards making a purchase today.
We are going to look at the psychology behind buying in an attempt to learn why people make certain decisions. We’ll also dive into how as business owners we can make our business appealing to a wider audience through psychological marketing techniques.
One of the most common marketing tactics that we have all seen before has a name, the left-digit effect. The last time you went to the store and purchased something because it was only 19 dollars and 99 cents and not 20 dollars, you experienced the left-digit effect.
Humans have an odd habit of focusing on the left digits of the price. People do this so often that marketers found a way to use it to their advantage.
When you price something at 19 dollars and 99 cents instead of 20 dollars, customers will be more likely to buy. The difference is literally a penny, yes. However, the brain rationalizes the purchase as being between 10-20 dollars instead of 20-30, which makes it appear more affordable.
Have you ever had a friend or relative recommend a brand or product, only for you to suddenly see it all over your town or the internet? Let’s say it’s a coffee shop. Suddenly, that new coffee shop is popping up on billboards, other people are posting pictures of the coffee, and you’ve been invited to the coffee’s social media.
The Baader-Meinhof phenomenon also goes by the name the ‘Frequency illusion’. It affects around 1 in 1000 people, however stronger imagery and powerful words/phrases can increase the odds.
Here’s the interesting bit. It’s not that the word, phrase, or company just popped up. The truth is, they may have seen the brand multiple times but they brushed it off.
Social interaction with someone who had a good (or bad) experience with the product makes the person who heard the story more likely to recognize the brand in their day to day lives. The social reinforcement in combination with the ‘Frequency illusion’ makes it extremely likely that you can increase sales by putting your product out for customers to see via your social marketing efforts or ads.
In marketing, it may seem odd to create a decoy product, but as it turns out, it’s very effective. The decoy effect occurs when a business owner wants a customer to purchase a larger or more expensive version of a product, so they throw in a third option to make the most expensive option seem like the logical choice.
Imagine you go to a sandwich shop. They tell you that they have a ‘snack’ sandwich that’s three inches for three dollars. On the other end, you can buy a footlong sandwich for seven dollars. Most people will buy a smaller sandwich because they want to save money. But if you add a six-inch option for six dollars, more people will buy the footlong sandwich. They see the six-inch (the decoy product) and think, “Why should I pay six bucks when I can pay seven for double?!”
You can apply this tactic to virtually any product. Obviously, the decoy product is still for sale. The goal is to get your customers to see the value in the more expensive version of your product and increase sales.
The fear of missing out (FOMO) is an extremely common trend that occurs when people see a special offer or value that they would like. The FOMO is particularly bad on social media, as 56 percent of people reportedly deal with this phenomena.
Think about the last time you went to a store and found something that was 25, 50 or 75 percent off. You likely jumped on the purchase because you wanted to get a good deal. Your customers feel the same way. They want a good deal, and your marketing strategy can help you bring in more customers through FOMO.
There are numerous ways you can target customers who have a fear of missing out. Some of the most common ways to draw in new customers are by offering ‘first-time shopper’ coupons. This will encourage customers to give your brand a chance, which will lead to lifelong customers.
You could also offer customers who sign up for your email list exclusive coupons. Special offers with your lead list are a dual function. It gives you a chance to target your audience through lead-building and increases your sales through customer curiosity and FOMO.
Getting into your customers’ minds is indeed a science. Which of these tips do you plan on implementing first? Tell us in the comments.
Syed Balkhi is an entrepreneur, marketer, and CEO of Awesome Motive. He’s also the founder of WPBeginner, OptinMonster, WPForms, and MonsterInsights. Syed can be found on Twitter @syedbalkhi.
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