9 Psychology Concepts applied to Marketing » Insights Portal

Understanding human behavior through psychology can make the difference between the success and failure of a marketing campaign. But where to start? Below we list the nine most useful psychology concepts for marketers.

1. Halo Effect

This concept suggests that our general impression of a person (or brand) influences how we perceive them in specific aspects. For example, if consumers see a company as innovative, they will likely assume that all of its products are disruptive, even without any concrete proof.

2. Loss Aversion

People tend to prefer avoiding losses than achieving equivalent gains. In marketing, this can be applied by offering limited-time offers or highlighting what customers will miss out on if they don't act – an exclusive discount, for example.

3. Social Proof

People are influenced by other people's behavior. Customer reviews, testimonials, and “best sellers” are all examples of social proof used to influence purchasing decisions.

4. Confirmation Bias

People tend to seek out and pay more attention to information that confirms their preexisting beliefs. A marketer can use this by highlighting product features that align with the target audience's already existing needs or wants.

5. Scarcity Effect

This concept suggests that when something is rare or difficult to obtain, it is perceived as more valuable. By limiting the availability of a product or service (e.g., “only 5 items left”), marketers can increase demand.

6. Anchoring Effect

People tend to rely heavily on one first piece of information (the “anchor”) when making decisions. In marketing, this effect can be used when setting prices (e.g. “reduced from R$200 to R$100”).

7. Goal Gradient Effect

This concept suggests that people are more motivated the closer they get to a goal. A marketer can use this when creating motivation for a potential customer to take action (e.g., “take a step toward your dream of homeownership”).

8. Effect of Mere Exposure

This concept suggests that people tend to develop a preference for things just because they are familiar with them. This is the foundation of many digital marketing strategies, such as repetitive advertising.

9. Authority Bias

People tend to believe and follow authority figures. In marketing, this can be demonstrated by having an expert or celebrity endorse a product.

Final considerations on the use of Psychology in Marketing

Psychology plays a fundamental role in understanding consumer behavior and, consequently, marketing. As Carl Jung once said, “Until you make the unconscious conscious, it will direct your life and you will call it destiny.”

Understanding psychological principles and applying them to marketing strategies can be the difference between being driven by the market or becoming a leader in it.

Want to keep learning? Read our guide on the main cognitive biases (with practical examples).