Consumer Psychology: why do we buy things?
A few weeks ago, I decided to go shopping at my local shopping centre. I took a couple of friends, and the aim was merely to kill time and have a browse around. To my surprise, I found myself walking back with a brand new book, an x-box 360 game, a milkshake I didn’t really want and a new CD. Considering I went just to look, what influenced me to spend over £50 on things I didn’t need – or simply didn’t even want? This is the nature of Consumer Psychology. It studies the impact of marketing and a number of factors on whether people do or do not buy items.
The principle aim of this field is to help firms and businesses improve their marketing strategies. This is achieved by an understanding of how the environment may influence an individual to purchase items, but also consumer behaviour and influences from other factors (friends, family, media, signs, subliminal messaging and much more).
Belch and Belch define Consumer Psychology as: “the process and activities people engage in when searching for, selecting, purchasing, using, evaluating, and disposing of products and services so as to satisfy their needs and desires”.
So what does influence us to buy things?
Kotler’s Black Box Model (2004)
Perhaps the most scientific suggestion as to our choices is the “Black Box Model”, developed by Kotler et al. (2004). Figure 1 shows this model.
It is named the Black Box Model because we know so little about what actually goes in our mind. We know processes occur in the brain, but we have very little idea as to how, why, when and where. So in a way, it is much like a black box. Let’s study the diagram further.
The external factors on the left are influenced by everything you perceive. It includes the product itself, and the environment. So we’re looking at a computer game – the product. Let’s assume you love gaming. The place, price and promotion are probably big influences. If you’re buying a Gameboy game from the 1990′s, priced at £80 from a seedy little shop in a dark alley full of drug dealers, I’m assuming you would perhaps reconsider. If you’re in Game, a well known video game retailer, looking at a brand new x-box game for £15, which is heavily promoted – you would probably be heavily tempted. It is cheap, a product you want, and looks amazing. You find yourself delving for your money with little thought. That is known, in the model, as the “marketing mix”.
The other external factors include demographics (race, gender, age etc.) A 60 year old male won’t buy a Barbie doll made for a 5 year old female (unless they’re buying it FOR a child – or so I hope…) Similarly, a Christian probably will not buy a Guru Granth Sahib or Qu’ran. Such factors are important to consumers. This may all seem like common sense, but all these factors are considered by you, and affect your behaviour. Other external factors include the situation, is it feasible for you to buy the item now? You might not buy a washing machine because you cannot get the item home, and they do not offer delivery. Is it socially acceptable to buy the item? Does your lifestyle permit the purchase of an item? All these external factors are considered – often in a split second.
Now we’re entering the “black box” – your mind. You make many decisions when considering whether to buy a product. Internal influences include: perception (does the item look good?); your needs (do I really need or want the item?); learning (what do I already know about this product?); beliefs (what do I believe about/what is my attitude towards this item?) and lifestyle (is the item acceptable for my lifestyle, and does it appeal to my interests?). Many of these are done unconsciously, although sometimes, when faced with a decision, you may find yourself asking these questions – especially the question “do I really need this?”. With your decision making process, you solve any problems you might encounter and consider the process of buying it. What will happen when you buy it, and what about after you have purchased the item? You try to gather information about the item to decide whether it is worth the effort and money.
The black box will then output one of two behaviours: purchase or no purchase. The latter is rather self explanatory; you do not buy the item and save your pennies. However, if you are ready to purchase the item, there are a few final factors to consider. This includes the amount to buy (with food particularly) and how you will pay. You might decide to buy something, but if the shop does not have a card reader and you only have a card, you are unable to buy the item. You will probably leave feeling pretty disappointed…
Of course, that is just one theory. What else do we know about consumer psychology?
Smells influence our spending.
In a small pizzeria in France, Gueguen and Petr (2006) investigated the effects of smell on the amount of money spent. On three different Saturdays (apparently when external factors were very similar, such as weather), different scents were released into the air. There was a control group, whereby no scent was released; customers smelt pizza and natural cooking smells. On another Saturday, lemon scents were filling the nostrils of their hungry diners. In the final condition, lavender incense was used. Although lemon did increase the level of spending, lavender increased spending the most; diners were spending 20% more when it was used (spending per person went from €17.50 to €21.10). This experiment is yet to be replicated or improved upon, but it does suggest that smells affect our consumer behaviour.
Choice is devastating.
Humans are naturally very lazy. Therefore, we would much rather make no decision than have to stand and decide on something complicated. Have you ever found yourself torn between two items and just thought “Oh, I give up!“? It’s a very common thing, so something having 35 different computers on offer with different specifications can actually harm your sales figures. I really suggest you visit the following link to another Psychology blog if you’d like to read more on this. It also contains a video of a talk by Barry Schwartz, who is the author of a book on why choices are bad.
We love to trust people, and we are vain, easily flattered and big headed by nature.
Humans naturally like to think everything is lovely. It is to our advantage to do so, if we did not trust anybody, we’d never do anything. People would never co-operate and we would simply fail at life and socialising. We also tend to believe that people of authority will act in our best interests – why wouldn’t they? Salesmen know this very well. They’re often polite, approachable and flattering. Have you ever been in an electronics store and been told that the “better model” is more suited to someone like “yourself”? They’re appealing to our worryingly vain nature, as we LOVE to hear about how amazing we are; “the better model is good for people like me? I must have it!”. Obviously you do not fall on your knees and obey their every command, but we are very susceptible to flattery and compliments. We may not even realise how good they make us feel, but they certainly get you reaching for your credit cards. If you are sitting there disagreeing, think about it. It is advantageous to be optimistic as it defends us from depression, and helps us become more appealing to other people. Our brain often forgets our faults and failures, or forgets them altogether. We love ourselves, whether you realise it or not.
Stress = spending.
Even when not shopping, we tend to make irrational decisions when put under pressure. So imagine the aberrant decisions your cranium will make, often without you consciously thinking. It is true that shopping can be a therapy; when people are angry they often storm off and browse the shops to calm down. However, if you are on a budget this may not be the wisest of endeavours. You will spend money irrationally, coming back with bad “bargains” and items you will never use. We feel good when we buy items, we like “things”. If you look at the bright side, however, buying an expensive book you will never read is worth it if you feel better when stressed. Unfortunately, pressure causes stress. As mentioned, stress causes a vacuous outcome with regards to your shopping. Salespeople often know this, which is why you get hoarded by three hundred enthusiastic and smartly dressed staff members dazzling you with their worryingly fake smiles. When you mix the pressure of them watching you like hawks and asking you if you need help enough to provoke suicide, and being stressed in general, with loads of decisions to make… you can work out the consequences.
We have no idea what we are doing.
Unless you are going to the local shop for milk, we often have a very vague idea of what to get when we go shopping for leisure, or even for food. We have an unclear goal, such as “I want something to do/use this weekend”. So that could entail reading, a film, music or something more radical like a drive in a new car or a paragliding weekend. You might think you are not that susceptible to huge buys like this, but for people who have enough money, it occurs a lot more than you would think. As we progress through a shop, our goals become more defined. A series of tests by Lee & Ariely have found that if you are offered coupons at the entrance of a shop, you are much more likely to use them. When offered them inside the shop, they are seldom used. The coupons influence what you want, as your goals are easily malleable. When offered in the store, your goals are already more concrete, so you do not need or want the coupons.
Appearance is everything.
Our brain naturally likes neatness and order. Look at the following two images.
Which one appeals more (regardless of the items they are selling?) For most people, the spacious, well-lit store will certainly look more pleasant. Small factors like layout, light, space and arrangement will severely impact your likelihood of spending money. In the shop on the left, conditions are cramped and will probably make you give up before you have browsed fully. Items are overlapped and hard to distinguish between. In the second picture, everything is well-lit and well organised. Book spines are easily readable and look well presented. Whether this appeals directly to you or not, your brain will love it! More expensive shops will understand this, and everything will look presentable and appealing – for example inside Harrods or Selfridges. Local shops or small high street retailers often cram loads of items into a small space to cater for many needs, which does not appeal as much.
Those are some of the main principles and findings of consumer psychology. Before long, I will post even more interesting information on this fascinating topic. I hope this has changed the way you view shopping though!