It’s nearly impossible to go more than a few minutes without seeing (or even hearing) an advertisement for a product or service. And in the digital age, ads are more tailored to our interests and shopping habits than ever before. If like most people, you’d like to tighten your budget, or even just understand your buying behavior, you’d do well to have some insider knowledge on how these advertisements influence your spending. After all, knowledge is power.
As you likely guessed, psychology plays a major role in marketing tactics. The better you understand the psychology behind the advertisements you’d exposed to, the more likely you are to be able to resist the temptation of purchasing something, especially when it comes to impulse buys. As the average American overspends by $7,500 every year, it’s important to realize that these small impulse buys add up. Let’s break down some of the most popular strategies that advertisers use to get you to spend:
#1: Status Anxiety
This is one of the most relevant marketing tactics today with the rise of social media and influencer marketing. As you well know, the prevalence of social media has exacerbated the struggle to keep up with the Joneses. If your neighbor has a large house with a nice yard, it’s easy to want that too, even if you don’t have a good rent (or mortgage) to income ratio. It’s understandable that when you’re always seeing the highlights of everyone’s life, that you would feel a desire and even a need to chase that same lifestyle—and advertisers know this.
This is where the tactic of playing off of status anxiety comes into play. Many people express feeling FOMO (fear of missing out) based on the content that they see on their social media feeds, which is a perfect opportunity for advertisers to play on this insecurity. By further perpetuating these feelings of status anxiety by working with influencers that we idolize, or at least follow closely, advertisers are able to cash in on our need to keep up with appearances.
So, just how effective is the status anxiety tactic through influencer marketing? According to a study by Twitter and Annalect, nearly 40% of Twitter users say they’ve made a purchase as a direct result of a Tweet from an Influencer.
Another persuasive marketing technique advertisers use is the concept of scarcity. The scarcity tactic is commonly used in marketing to give something value based on the perception that it’s rare.
You may recognize this tactic when you see the words “limited availability” or “special edition”. This technique was very popular during the 90s with collectors items, you or your parents probably had a mountain of Beanie Babies stock piled at some point waiting for the opportune moment to cash in on them. However, the scarcity tactic is still widely used.
In fact, scarcity is a major advertising technique in the fashion industry—from special release sneakers to limited quantities of designer bags this drives many people to wait in line for hours to score the latest items from their favorite brand.
#3: Positive Association
Generally speaking, when you associate positive emotions with something, you’re going to be more drawn to it. That’s how the positive association marketing technique works so well. We see it all the time in advertisements that use cute animals, feel-good messaging, and humor to create a link between making us happy and their brand.
It also makes these products and services memorable. So when you’re walking down the aisle at your favorite store and you’re trying to decide which detergent to pick, you’ll be more likely to choose their product because their name will stand out in your mind.
While this isn’t the most sinister of advertising techniques, it can cause you to spend more money for a brand that you’ve heard of and feel connected to, instead of saving on the bargain brand. Keeping the concept of positive association in mind can help you remember to choose your products more consciously (and possibly save yourself money).
#4: Sex Appeal
Using sex appeal as a sales tactic isn’t new but it is highly effective and still used in many of today’s advertisements. That’s because attractive people help make products more appealing, especially when they embody the desired end result of using the product.
For example, makeup companies often use popular models as their spokespeople. When they advertise the product using these gorgeous men and women, especially those with exceptional makeup skills, they’re basically conveying to customers that they too can look like this individual, if only they used their products. However, at the end of the day, that’s usually not a realistic expectation.
Next time you find yourself suddenly wanting something you had no use for before, consider whether it’s because you’re being persuaded by this marketing tactic that plays on people’s insecurities and deepest desires.
Have you ever found yourself feeling like you’re seeing an ad or product everywhere you turn? It’s likely the result of highly targeted repetition.
This advertising technique can be employed in several ways:
- Repeating this information several times within the same ad
- Using the same messaging across different types of ads
- Exposing you to the same ad on different platforms
We’re exposed to ads virtually everywhere we go, making repetition an easy tactic and especially effective technique for advertisers to use when trying to familiarize us with their product. Based on studies conducted on the effectiveness of repetition, it has been found that it takes at least seven different exposure events for an ad’s message to sink in.
While some hyper-aware people might find the repetition method to be annoying, which could then deter them from purchasing from the seller, it often works in favor of brands, so this tactic likely isn’t going anywhere any time soon.
#6: Decoy Method
Just like there are certain strategies that advertisers use to get you to act on a purchase, there are others that are specifically designed to get you to spend more.
The decoy method is a sneaky tactic that’s commonly used when presenting pricing options to consumers. It works by skewing pricing choices by presenting customers with options that encourage them to go with a more expensive product or plan.
You’ve likely seen the decoy method in action when you’ve purchased a subscription or concessions at a movie theater. You’ll usually be presented with three options, the one between the highest and lowest price is the decoy. This “third option” is brought into the equation to make the more expensive product or plan seem like it’s a great deal and sway you toward spending more.
For example, if you see the prices for a new music subscription as: $5 a month with commercials, $10 a month with limited commercials, or $12 a month for commercial-free listening; you’re most likely going to feel like the $12 subscription offers the greatest value and purchase that plan.
Real estate expert and founder of Texas Hard Money Loans Sacha Ferrandi explains, “Companies nowadays make it easy for you to justify spending. When you think your total will be the $5 per month as advertised, it doesn’t seem like a crazy amount to spend. However, when you realize the better value is the $12 per month plan you still see this as a good value for the money, even though it’s more than twice as much as you were initially willing to spend. This is how companies bait you into purchasing better packages.”
While some people are very diligent about sticking to their budget and always choosing low-cost options, many of us fall victim to the decoy method when making purchases. After all, it’s only natural to want to get the most for your money.
Take More Control Over Your Purchase Decisions
While being aware is the first step, you likely won’t be able to escape the influence of all of advertisers’ techniques, unless you’re willing to give up all of your devices or take steps to make more your information inaccessible to advertisers—for example, turning off your phone’s GPS, blocking third-party cookies, turning off ad personalization in your Google settings, and more.
However, now that you’re more aware of how advertising works, you’ve become a smarter consumer and have the opportunity to have more say in how you spend your money.