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Consumer Behavior

Consumer behavior—or how people buy and use goods and services—is a rich field of psychological research, particularly for companies trying to sell products to as many potential customers as possible. Since what people buy—and why they buy it—impacts many different facets of their lives, research into consumer behavior ties together several key psychological issues. These include communication (How do different people respond to advertising and marketing?), identity (Do our purchases reveal our personality?), social status, decision-making, and mental and physical health.

Why Consumer Behavior Matters

Corporations, political campaigns, and nonprofit organizations all consult findings about consumer behavior to determine how best to market products, candidates, or issues. In some cases, they accomplish this by manipulating people's fears, their least-healthy habits, or their worst tendencies. And consumers themselves can be their own worst enemy, making rash purchasing decisions based on anxiety, faulty logic, or a fleeting desire for social status. But consumers aren’t powerless: Learning more about the different strategies companies employ, as well as the explanations for people's often confusing purchasing decisions, can help individuals more consciously decide what, why, and whether to buy.

Why do marketers study consumer behavior?

In developed countries, people spend only a portion of their money on things they need to survive, and the rest on non-essentials. Purchasing decisions based on want, rather than need, aren’t always rational; instead, they are influenced by personality, emotion, and trends. To keep up, marketers continuously investigate how individuals and groups make buying choices and respond to marketing techniques.

How do politicians use marketing research in campaigns?

Political marketing is, in many ways, similar to product marketing: it plays on emotions and people’s desire for compelling stories, rather than pure rationality, and aims to condense complex issues into short, memorable soundbites. Smart politicians use marketing research to tailor their messages, connect with voters who share their values, and counter their opponents’ narrative.

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The Psychology of Buying and Spending

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Much of what people purchase—like food, shelter, or medical care—is necessary for their health and security. But what compels someone to buy things that aren’t necessary, like the latest iPhone or an impractical pair of high-heeled shoes? The study of why people make such purchases—which are often irrational—is closely related to the field of behavioral economics, which examines why people deviate from the most rational choice available.

Behavioral economists, marketing professionals, and psychologists have concluded that extraneous purchases may be driven by a need to display one’s social status, or in response to an emotion like sadness or boredom. In other instances, retailers may successfully manipulate the desire for a “good deal” by making an unneeded item seem especially affordable or portraying it as being in limited supply.

Learning how to recognize common manipulation tactics may help individuals and families save money—and stress—in the long term.

Why does buying things feel good?

Many human behaviors are driven by reward. Purchasing a new gadget or item of clothing triggers a surge of dopamine, which creates pleasurable feelings. Though the glow of a new purchase may not last long, the desire to once again be rewarded with a burst of dopamine drives us to buy more.

Does buying more things make you happy in the long run?

It depends. Some research suggests that experiential purchases like vacations bring more happiness than material goods, in both the short- and long-term. However, this rule may not apply universally. For lower-income people, spending on material goods that meet basic needs is often more conducive to happiness, especially if the items remain useful over time.

How Advertising and Marketing Work

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Two vast, interrelated industries—advertising and marketing—are dedicated to introducing people to products and convincing them to make purchases.

Since the public’s desires tend to change over time, however, what works in one product’s campaign won’t necessarily work in another’s. To adapt messages for a fickle audience, advertisers employ focus groups, market research, and psychological studies to better understand what compels people to commit to purchases or become loyal to brands.

Everyone has heard the advertising maxim “sex sells,” for instance—but exactly what, when, and why sex can be used to successfully market a product is the subject of much debate among ad makers and behavioral researchers. Recently, some evidence has suggested that pitches to the perceived “lowest common denominator” may actually inspire consumer backlash.

How does marketing influence what we buy?

Marketers regularly use psychology to convince consumers to buy. Some common strategies include classical conditioning—training consumers to associate a product with certain cues through repeated exposure—creating a scarcity mindset (suggesting that a product only exists in limited quantities), or employing the principle of social proof to imply that everyone is buying a product—so you should, too.

Do marketers take advantage of how the human brain works?

Marketers often exploit cognitive shortcuts, known as heuristics, to convince consumers to make purchases. One example of this is the anchoring bias, or the brain’s tendency to rely heavily on the first piece of information it learns. A savvy marketer may say, for instance, that a car costs $20,000, then quickly offer to take $1,000 off. Since the consumer “anchored” on to the initial $20,000 price tag, a $1,000 discount seems substantial and the consumer may leap at the offer. But if the car was truly worth $15,000, it would still be overpriced, even with the supposed discount factored in. 

How to Appeal to Consumers

In a crowded marketplace, anyone hoping to sell a product or service will need to stand out. To succeed at this, marketers often turn to psychological research to identify and target their most likely consumers, grab their attention, and convince them that a product will fill a specific need or otherwise better their life. Aiming to inform and persuade consumers—rather than manipulate them—is widely considered to be the most ethical approach, and is likely to help build brand loyalty more than cheap marketing tricks.

How can I persuade people to buy my product?

Both the message and the messenger matter for persuasion. Marketing researcher Robert Cialdini has found that first impressions matter greatly—a company (or individual) that appears trustworthy and warm is more likely to gain their audience’s trust. Cialdini also coined the term “pre-suasion” to argue that marketers must grab consumers’ attention before making an appeal—by offering free samples, for instance, or couching a product pitch in an amusing commercial. 

How can I make my marketing campaign more effective?

Turning to psychology can help. Appealing to consumers’ emotions and desire for connection with others are often powerful marketing strategies, as long as they’re not interpreted by consumers as manipulative. Introducing novelty, too, can be effective—research shows that consumers respond to surprising ads, humorous ads, or even “experiential” ads (such as parties or events designed to promote a product). Repeating an ad enough times so that a consumer remembers it—but not so much that they become frustrated—is also a critical part of any effective ad campaign.

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