Whether you own a corporation or manage a small business, you need to understand marketing psychology.
Offering a superb service or product is only one part of your business; promoting and persuading is another.
The psychology of marketing is about knowing how potential clients think and behave. They make emotional decisions and react in various ways depending on their demographic.
Recognizing the desires of your target market can help you tailor business marketing toward the right audience and get vital messages across with clarity. Once you know who you want to influence, note the following marketing tips.
Decoy effect
To use the decoy effect, compare one thing to another less favorable to persuade viewers to imagine the first is a bargain. Hence, you might suggest the information in the eBook you’re selling for $5 is the equivalent of a $500 course on the topic covered. Or, you may offer three services, two of which are decoys to encourage customers to imagine another is a steal.
Social proof
Potential customers are used to deciding how to spend their time and money after reading reviews and testimonials. They are persuaded by the opinions of others and also see the achievements of businesses as proof it is worth engaging with them.
Ensure viewers that your brand is popular so they feel comfortable in doing business with you. Provide evidence of past sales and positive customer reviews. Also, refer to the prestigious clients you’ve worked for in your marketing material.
Reciprocity
Have you been offered a free newsletter, eBook or screensaver when you visited a website before? If so, the site owner was using reciprocity as a tactic. People are more likely to use your services or buy from you if you do something for them first.
What if you don’t have enough funds to provide free stuff? You can give away tips, or knock the first 10 percent off the price of a service for new customers. Or, you might provide a helpful blog, free webinar, podcast or create a web page guiding people to free resources offered by others in your industry.
Price anchoring
Sales are the best places to observe price anchoring. If your favorite designer is selling goods at $40 that are usually $65, you are overjoyed. As the sale ticket shows the previous price and the cost of the item now, you calculate the difference and figure you’re making a considerable saving.
However, for price anchoring to work, you need to know how much your target market will pay for goods and work within parameters. Setting prices too high when comparing them to higher rates won’t make people buy.
Loss aversion
People hate giving up what they have, even if it was given to them for a limited amount of time. How this procedure can apply to your business may or may not be immediately apparent. If you offer an anti-malware tool to people for a month and then levy a charge if they want to keep it, loss aversion will come into play. Many customers won’t want to part with the program, as using it is part of their routine.
Loss aversion can also be used for other services and products with a little forethought. For instance, you could give an online magazine free for a few months, and then levy a charge for future months. Reciprocity will work alongside your tactic and increase the odds of success.
Scarcity
If customers rush to buy the last two dresses on a rail and can see empty clothes hangers, scarcity is at work. The idea there’s a shortage of something because many products have been snapped up sends pulses racing. The sense of urgency, plus social proof of popularity, motivates people to part with cash.
Remember, though, offering a few items for sale because that’s all you’ve got isn’t the same as almost running out of stock due to demand. You want customers to feel lucky to procure a much-desired item or service, hence leaving empty hangers as proof of popularity.
Make use of the marketing tactics mentioned, or just a few, and you’ll gain business. Adopting the methods will take time, but build gradually, until those relevant to your company are applied, and your success will grow.