The psychology of decision making, and how it applies to marketing

By understanding and analysing the 6 key factors people consider when they make decisions to buy (or not to buy) you can shape your marketing plan to maximise sales. This is basic marketing - the power of persuasion.

1. Reciprocity: “I owe you a favour”

This is essentially a social etiquette. For example, if someone sends you a birthday card do you send one back? Most probably yes. You feel obligated to return the act of kindness. The same can work in business, by offering customers an incentive or free gesture.

2. Scarcity: “Will I miss out?”

Scarcity in marketing is used in two ways, either with limited time or limited quantity. People desire what is less available and this often encourages people to buy now rather than later.

It can even make customers believe a product is more valuable. Two groups of college students were given identical cookies; Group A had enough for one per student, Group B were given as many as they wanted. Group A said they were the best cookies they had ever tasted, Group B said they were average. The power of scarcity.

3. Authority: “The expert said it was good”

We view authority in different ways, such as titles or uniforms. Marketing authority is more closely aligned with credibility; credibility through expertise and trustworthiness. This is often achieved in the form of case studies, testimonials or endorsements.

4. Consistency: “I said I would do that”

People like to be consistent. If they make a public statement to do something then they feel obliged to carry out their promise. A restaurant reduced the number of unattended bookings by simply asking “WILL you let us know if you need to cancel?”, instead of “Please let us know if you need to cancel.”

5. Liking: “The Sales Rep was nice”

Attractiveness sells. It is much easier to say yes to someone you like. In sales it is not necessarily about the physical attractiveness, but the way in which we listen, advise and respect the client. Training in social styles is an important part of the sales and marketing process.

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So how could this framework be implemented into a sales or marketing environment? Here's some ideas...

Reciprocity – Give away some helpful tips or free research results.
Scarcity – Implement a time or quantity limit when delivering your sales pitch.
Authority – Train your staff to have excellent product knowledge or quote testimonials.
Consistency – Use terminology which makes your prospect commit to further conversations.
Liking – Nurture your prospective client by taking advantage of the benefits of human interaction.

So that's five of the 6 powers of persuasion. Want to know the sixth? Check my blog post 'The power of persuasion – 6 steps to influencing' and all will be revealed :)