Like it or not, marketing frequently uses psychology to work effectively, or what is sometimes called neuro-marketing. In many ways, the smart marketer knows what makes buyers tick and select one product over another. Yes, sometimes it’s purely about price (and hence stores like eBay allow you to sort according to price), but more often, many other factors come into play.
Kinds of Psychological Marketing
Framing your wording and using figures
How you position things makes all the difference. For example, 99% fat-free is more appealing than the claim that an item has 1% fat. People want something which is mostly free of fat, versus consciously buying an item said to have a % of fat. Likewise, words like ‘lite’ appeal. In pricing, we all know that $29.95 is a far better value than an item for $30. And especially $99.95 versus $100. Note here that 95c is better than 99c, which was the case years ago.
Giving the illusion of affordability
If something is ‘Less than $1 a day’ is far more affordable than the price of $350 for the year. $21 a week for a gym membership sounds so much better than $1092 a year. Likewise, accounting packages work on a monthly subscription; you’re paying, say, $75 a month; you might think about the $900 a year it costs, but unlikely you’ll compare it to say 10 years (about 65% of businesses make it to 10 years). Accounting software companies much prefer to get say $9,000, rather than what they could have got for a one-off buy; hence, it’s become almost impossible to find a non-subscription-based accounting software option. Renters pay so much more than buyers.
Give 3 choices
People need some options, and often three choices have at either end being unreasonable in pricing. Either the size (versus the price) represents no value (such as a tiny coffee), so then the middle or larger sizes look appealing. It comes back to the perception of value.
No more than 3 choices
However, never give more than 3 choices, otherwise you create overwhelm and people then can’t (and don’t) make a decision. Even on a restaurant menu, you will of course have more than 3 choices, but you shouldn’t have say a hundred. It just becomes too hard to choose, which is often why restaurants have ‘Chef’s Choice’ on the menu or a ‘Specials Board’ to help with decision-making.
The power of free
Far better than a discount for a business is to provide a free gift; people love free stuff. I had a client years ago who made patio flyovers (not cheap) and provided a free esky (it was empty!) and someone actually chose them, admitting to the appeal of the free. A variation of this is buy 2 and get one free. This is exceedingly popular with clothing and especially shoes. You go in thinking you’ll buy one pair, but hey, a free pair of shoes has big appeal.
Contrasting, especially visually
If you show a picture of a semi-expensive item, people might think ‘oh, it’s lovely, but it’s a bit pricey’ … however, place it next to a similarly nice item, which is much higher in price, and suddenly, you see the value of the first item, which now looks very reasonable.
Anchoring bias
This strategy is used a lot in marketing. Rather than saying “Down to $49” if you show the original $99 and put a line through it and then show a large $49 … suddenly the consumer is thinking about the perceived value they must be getting as you’re paying half price.
False discounting
I do not support this strategy, but it’s done a lot, especially for ‘Black Friday Sales’. The price is inflated for the period, say by 25%. Then a 20% ‘discount’ is offered so it looks like you’re getting a really good discount. If you follow a product and stores, you can see if they are inflating their prices for false discounting or offering a true discount.
Trials or samples
These are excellent and frequently used where suitable. It both gives the customer a chance to check out the service or product, plus, once they do, if the sample is of good quality, they very likely will be invested or love what they’ve experienced and want to buy or sign up. This is used with TV subscription services, get the first month free, you get caught up in a series, or forget to cancel and you’re in. Even the likes of iTunes do this, where you’re able to listen to 30 seconds of a song before spending as little as $2. As a business coach, I also do this; offering to suitable prospects a free 30-minute sample coaching session, including business analysis.
Social proof
Leverage social proof, such as reviews and testimonials. Afterall if it was good for everyone else, it will be likely good for me. We’ve become very familiar with reviews and ratings and frequently look at and consider others’ experiences first. Some businesses have ditched ‘guarantees’ as I suppose too many abused them, although there are some options around, but the next best thing is a heap of independent people saying they loved the product or the experience was awesome and why. A variance on this is influencer endorsements, but really, people are savvy enough to realise they are getting something for their endorsement, which is often the product, and if it’s overly favourable, was it any different than a staff member saying it was fabulous?
Visuals are critical
It doesn’t matter what the product is; the imagery has to be excellent. It needs to be clear, well-lit and ideally show multiple angles. Even if you’re selling a second-hand item on Marketplace, you should have multiple images to show various angles. Often one of the images includes the dimensions, so the purchaser can easily see this information as well. Even better than having the item (especially if it’s something a bit larger or more expensive) on a plain white background is to ‘stage it’. This is often done with furniture, artwork or even jewellery or skincare. There are a few apps out there where you can digitally stage an image.
The impact of colours
Different colours have different impacts on people, plus it also depends on the industry. For example, those in accounting, bookkeeping or finance should not use red as it’s associated with that old adage “in the red” which is not a good thing. If you are targeting a female audience, then you might go pink, or if you want to portray trust and strength, blue may well be your colour of choice.
Annoyance marketing
Whilst it can work well for brand awareness, it can run the risk of alienating potential customers and negatively impacting long-term purchase intent. Rather, aim for being memorable through something interesting and quirky, rather than outright annoying. The frequency of advertising is important too; being in people’s faces every 2 seconds, they will switch off very quickly, block you or change channels. I’ll bet I’m not the only person who avoids free-to-air TV (or programs with ads) the week prior to an election! Out come the DVDs that week, because it’s just too annoying.
Scarcity
This can be an effective strategy, but do it right or you’ll be dismissed. Buy within 10 seconds, or the offer is off the table, feels just like a scam. A bit like the free steak knives deal that used to be popular. However, if you see “5 left” or “14 have viewed” or limited appointments in the calendar for bookings, then that feels more genuine. When it comes to service-based businesses, if you’re too available, then people wonder at your value/worth. An orthopaedic surgeon who can see you the same day makes you wonder if they are the best choice for your knee surgery.
Marketing is far more than just putting a product up online, or doing an advertisement or throwing money at someone to ‘sell’ for you. Effective and successful marketing and sales both have psychology behind them. It’s not about tricking someone (other than the above concept of false discounting) but about understanding the average person’s thinking behind making a decision to consider or buy a product or service. Our brains work in very effective ways and instinctively we know or trust some salespeople or products and not others. Consumers are not stupid, but they can be well, dare I use the word, manipulated. Perhaps a better word is ‘lead’ to our products or services. Understanding what makes a buyer tick helps the marketer (and salesperson) to achieve their goals and objectives.
If you need any assistance with marketing strategy or your sales process, reach out to me; more than happy to help as this is definitely one of the many aspects I cover during my business coaching sessions. Leading by example, feel free to enquire about my free sample coaching sessions.
Read Stop Strangling Your Business & Overcome Negative Mindset!
