Consumer psychology: how understanding it can help build trust in a company and increase sales
Conversion is a vital indicator of a website’s success. However, its level and dynamics depend on various factors that require regular analysis. In this context, consumer psychology is a valuable tool. It includes the peculiarities of people’s evaluation of products and the process of their purchasing decisions.
The first principle of understanding consumer psychology is a personalised approach. Research shows that salespeople make more money when they care about their customers. For example, they ask how comfortable the customer offers water, coffee or sweets. This way, the person feels treated uniquely and will likely be grateful. In digital marketing, this approach takes the form of:
– a personalised email newsletter;
– loyalty system;
– bonuses on the occasion of significant dates for the consumer;
– gifts and personalised discounts.
In business, as in other areas, mistakes and conflicts are inevitable. It is essential not only to minimise them but also to respond to them correctly. According to psychologist Fiona Lee, acknowledging mistakes often leads to positive results. A company’s ability to take responsibility for its actions increases consumer confidence and strengthens relationships. An analysis of the financial statements of 14 companies confirms this principle. It found that companies that openly acknowledged a strategy failure increased their stock market value the following year. Consumers’ perception of a company that has recognised a mistake is that the company is in control of the situation and committed to change.
How belonging and rewards work in consumer psychology
Humans dislike comparisons and would instead feel unique. However, this is not an unambiguous statement. For example, consumers respond well to group affiliation when it is positive. In business, this principle takes the form of broadcasting specific stories:
– people who have used the company’s services have been successful in a particular area;
– mentioning a certain number of consumers who have bought the product;
– the company’s customer base has grown by a certain number.
Such talking points encourage consumers to join the selected customers’ group, creating a sense of belonging to something unique.
We should not forget marketers’ traditional method of using gifts. This approach is great for increasing the average order cheque. The reason is simple: the human brain expects an immediate reward for its actions. A gift, on the other hand, is an opportunity to receive positive emotions quickly.
Another popular psychological technique is to create a sense of urgency to act quickly. This is often achieved by advertising promotions or discounts with a limited validity period, which usually accomplish this. At the same time, psychologists have extended this principle. They believe a sense of urgency combined with specific instructions is more effective. In some cases, consumers need clear instructions to make a purchase.