How Marketing Psychology Can Improve Your Bottom Line
Make these quick adjustments and bring in more sales.
Image credit: Portra Images | Getty Images
Entrepreneur, Digital Nomad and Marketing Consultant
May 16, 2017
Small changes can make a huge difference.
We often underestimate the value of the little things: a sentence, a button, a color . Those who’ve spent any time conducting A/B split tests know, though, that small changes can lead to surprising results.
Marketing psychology is one of those little things , which can have a huge impact on your bottom line. Here are four psychological principles that you should utilize to boost sales.
Build your tribe . . . and your enemy
Humans like to feel like they belong, which is why most identify with a particular group, community or belief -- or even gain an understanding of their identity based on membership within that group. In psychology, we call this social identity theory .
But, it’s unrealistic to expect everyone will like you, and people-pleasing behavior can actually neutralize how others respond to you. They don’t see you as an ally or as a threat -- they just just see an amorphous blob in the middle.
Look at The Beatles, one of the most universally accepted bands of all time. Even they had haters, and not everyone bought their music.
Whether it’s the infamous Mac vs. PC debate or Android vs. iPhone, there is an enemy for every tribe. The polarity creates brand loyalty and repels those who side with the other tribe.
The bottom line here is to not try and marketing to everyone. Create your loyal tribe.
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Tap into reciprocity
As you give away blog posts, articles, podcast episodes, eBooks, webinars and even free trials, you are activating the reciprocity principle with your customers.
When people receive something for free, even when it isn’t particularly valuable, they feel indebted to you and want to return the favor.
As an entrepreneur, you can create something valuable, then give it away and build trust with your customers. The customer responds by joining a mailing list or by buying a product.
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Leverage social proof
Have you ever been in a social situation where you didn’t know what the correct course of action was? Of course -- we all have.
But what did you do? You likely observed others, then followed suit because you assumed this to be the “correct” behavior in that given situation.
This is known as social proof, which is a form of conformity. Simply Psychology defines conformity as “a type of social influence involving a change in belief or behavior in order to fit in with a group.”
Here are several ways you can guide your target customers to take a desired action by using social proof:
Media coverage. Getting featured on noteworthy publications and TV stations -- and displaying this fact on your website -- can build trust with your audience.
Testimonials. Candid and unedited customer testimonials make you more credible. Make sure to include the customer’s name and picture.
Social sharing. A high number of social shares and email subscribers are often seen as signals of your popularity.
In investments, loss aversion is simple: People prefer to avoid losses than accrue gains.
Loss aversion is often at play with free trials. Consider the example of Netflix. You can try the service for 30 days and then cancel your subscription if it’s not for you. But, most people will stay with the service to avoid the potential “loss” of hundreds of movies or TV shows instead of looking at the prospect of gaining back $9.99 per month.
It has often been said that the customer is more interested in the benefits of a product than the features, and that is certainly true. However, you can still highlight potential losses your customer might feel in your offers as well, and this can lead to more sales.
Applying marketing psychology to your existing marketing efforts can make a big difference. Boosting your bottom line could be a few quick tweaks away.
Amar is the Founder of the travel website Gap Year Escape and e-commerce business Suave Grooming. He has been an entrepreneur for seven years and has run his businesses while traveling all seven continents.