Psychology in marketing is the application of psychological principles to the field of marketing.
It can be used to study consumer behaviour, craft the perfect ads and improve the overall marketing strategy. It covers areas like the psychology of persuasion, the development of effective branding, the perception of value and how to create an emotional connection with customers.
Psychology in marketing is not just about understanding why people buy; it's also about understanding what prompts them to take action. It involves understanding a customer's current knowledge, attitude and behaviour. A deep understanding of all three helps marketers craft messaging that resonates and makes a lasting impact.
The Baader-Meinhof phenomenon is a phenomenon in which a person experiences sudden repetition of a word, phrase, experience, or even a seemingly random event after having experienced an initial occurrence of it only once. It has also been described as “frequency illusion” or “recurrence illusion,” as the person builds an expectation of repetition after the initial occurrence of this phenomenon.
"Below the line" marketing is a term used to describe marketing activities which are employed to encourage customers, clients and potential customers to interact more closely and directly with products or services. It is designed to influence behaviour by promoting the target product or service without relying on traditional advertising techniques such as television, radio or print advertising.
Choice fatigue (also known as decision fatigue) is the psychological phenomenon whereby people become less decisive and less able to make decisions as they are presented with more and more options. This can occur in all aspects of life, but is particularly common in consumer culture due to the large number of products, services, promotions and choices that are available.
Customer experience (often abbreviated to CX) is the combination of all interactions a customer has with your business, which have the power to make or break a long-term relationship. Good customer experience leads to higher customer loyalty, satisfaction, and retention rates, while bad customer experience events can cost you valuable customers.
Customer motivation is the process of understanding what motivates customers to act and purchase, and creating marketing strategies to meet their needs and drive the desired behavior. It is an integral part of brand management and marketing, and if used correctly, it can be a powerful tool for achieving long-term success and building customer loyalty.
Customer needs are requirements that a customer has in relation to a product or service, and they are essential when it comes to adapting and improving a business’s services to meet the demands of their customers. Understanding customer needs is essential in ensuring that businesses are able to accurately and meaningfully respond to their customers, and provide them with the best service possible.
The Decoy effect is a marketing psychology phenomenon that explains how humans tend to make decisions between two options when a third, ‘decoy’ option is added. This phenomenon is closely related to behavioural economics, the study of decision making, and the well-known concept of choice architecture.
Groundswell is an approach to marketing coined by Charlene Li and Josh Bernoff in their book Groundswell: Winning in a World Transformed by Social Technologies. It is the idea that individuals, organisations and the public in general, use social technologies - such as blogs, wikis, forums, etc.
The KISS principle, or Keep It Simple Stupid, is one of the most popular and widely-used principles of marketing and design. This principle suggests that products should be easy to use and understand, and it is applicable to all kinds of marketing projects and initiatives, be it social media engagement, content marketing, websites and more.
Loss aversion is a concept from marketing psychology that suggests that people are typically more likely to take action or take a risk to avoid a loss than to acquire a similar value in a reward. In other words, people feel the pain of losses much more strongly than the pleasure of gains.
Marketing psychology is the study of how the mind processes information in order to influence and shape the decisions and choices we make in the commercial world. It combines psychological principles and marketing strategies to gain insight into how people think, act, and respond to marketing activities, allowing brands to more effectively target and influence their target customers and audiences.
Mystery shopping is a research method that is used in the marketing psychology field to help companies measure the quality of customer service or the shopper experience. It involves sending ‘mystery shoppers’ or undercover test customers to observe and evaluate a business’ customer service, product availability, pricing and overall quality.
The Pratfall effect is a behavioural phenomenon which suggests that demonstrating a weakness can actually endear someone to you in the eyes of others. It has been widely documented in marketing psychology and suggests that a small mistake or shortcoming makes someone more appealing and well liked by people around them.
Priming is a sub-field of psychology that explores how exposure to events and behaviours can influence later behaviour. It is based on the idea that when a person is exposed to stimuli that activates a certain response in the mind, they are more prone to exhibit the same behaviour in the future.
The Pygmalion effect is a phenomenon which refers to the idea that the higher expectations one has of someone, the better the person performs. This effect typically goes beyond simple self-fulfilling prophecies, and is thought to be a result of the particular behaviours and expectations that are associated with higher expectations.
Rational buying motives are the influences that drive people to purchase a product or service – consumers do not buy on a whim, but are instead responding to certain triggers. The idea is that customers will deliberately weigh the benefits of the purchase against the cost of the purchase, and make a rational decision based on their own personal needs.
Reciprocity is a powerful psychological tactic in marketing and sales, which can be used to build customer relationships and create customer loyalty. It is based on the concept of give and take, where people are encouraged by their peers to give something valuable in exchange for something of equal or greater worth.
Scarcity is a powerful psychological motivator in marketing and refers to a concept in behavioural economics whereby, when we perceive something as scarce, we feel a heightened desire to have it. The presence of limited availability causes us to value the item more, increasing the likelihood of us wanting to buy or use it.
Tripwire marketing is a digital marketing strategy that is used to encourage the customer to make a desired purchase. It involves creating an incentive for the customer to purchase a specific product or service, typically at a lower price than that for which the customer was originally considering.
Upselling is the practice of pushing customers to buy a higher-end version of a product or service they are already considering. There are many reasons to upsell, but the bottom line is that upselling increases profits, either by outright sales or by generating customer loyalty among those purchasing improved products and services.
Value in marketing is the relative worth of a product, service, or brand against its perceived advantages and disadvantages. It is an important concept because it helps marketing leaders and team members decide what marketing initiatives to pursue, and how to position and price their products accordingly.
The Vampire effect is a term used to describe and analyse the impact of Digital Marketing on customer behaviour. It is based on the assumption that when customers are exposed to a vast number of Digital Marketing tactics and strategies, the customer's behaviour can shift, subtly and subconsciously, towards the marketing messages being presented.
The Veblen effect is an economic phenomenon which takes its name from the American economist Thorstein Veblen, who first wrote about it in 1899. It is used to explain the observation that when a product's price goes up, people often perceive it as being of higher quality and are more likely to buy it.
Verbatim effect is the term used to describe the increased effectiveness of marketing messages when the exact words used are repeated by customers. The Verbatim effect is an important part of a successful marketing strategy and is used in various aspects of marketing, including direct mail, radio, television, and print.
Virality is the concept of creating something that is capable of being spread rapidly and efficiently across various networks, to the point of becoming something almost ‘viral’. It’s a term that has become common in the digital age, as we’re able to share things like videos, images and news stories with amazing speed.