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ventes neuromarketing

Using neuromarketing & customer psychology to improve selling processes

 

ventes neuromarketing

 

In a former blog post, we explained how neuromarketing and customer psychology can improve product design and packaging. But once your product has been designed and is ready to be sold, how to promote it and sell it efficiently? To this end, neuromarketing and customer psychology bring efficient evidence-based solutions.

 

 

 

1) SEGMENTING CUSTOMERS BASED ON THEIR PSYCHOLOGY

 

In order to promote products on a large scale, marketing segments based on customers’ psychology is a powerful and revolutionary technique. Psychological segments deconstruct traditional segments, like age, gender, socioeconomic status, salary or living area.

 

 

Traditional segments are less accurate than psychological segments to initiate marketing or selling actions Click To Tweet

 

 

Let’s imagine each traditional segment contains a cluster of persons who fit into it. Some segments will merge with one another and define personas: for instance Clare, 38yo, married, 2 kids, living in a suburban area, a qualified worker in a public company. Research in social psychology shows that psychological dimensions like openness to experience, extraversion or need for cognition, blend traditional segments. That means that these aforementioned psychological dimensions gather people from distinct traditional segments.

ventes neuromarketing

 

For what consequence? Traditional segments are less accurate than psychological segments to initiate marketing or selling actions. It’s useless to communicate with every 30 or 40-year-old in the same way. Age and other traditional segments are not the most relevant and efficient segments to tailor a message to your target. Personality is by far more useful.

 

For instance, one scientific study has shown that mobile application sales could increase by up to 79% when their promotional message was tailored to the target’s personality (see our former post here for a more detailed description). These findings led ANALYTICA to create a marketing innovation called PsychoSegments (see video with English subtitles below).

 

 

 

 

2) APPLYING PSYCHOLOGICAL PRICES

 

prix psychologiques ventes

Psychological prices are one of the most popular customer psychology techniques. Psychological prices consist of setting prices at a given threshold above which products are perceived to be too expensive. We all know the principle of prices ending with nine: a pair of trousers will be perceived as less expensive when priced at £49.99 than if it was sold at £50. Beware though! Nine-ending prices cannot be applied to every product or service. We explained why in a former post here.

 

 

 

 

3) ENCOURAGING PURCHASE DECISIONS

 

How to efficiently promote and sell a product? And most of all, how to encourage customers to purchase a product over another? This turns out to be rather simple, mainly because our decisions are predictable! Our brain perceives, analyses information and adjusts our behaviour in a predictable way. This is what we call ‘decision rules’.

 

 

it is rather easy to predict customers’ choice for a given product when the conditions favouring this choice are met Click To Tweet

 

 

Once these rules are known and understood, it is rather easy for an expert to predict customers’ choice for a given product when the conditions favouring this choice are met. Marketers then need to recreate these conditions to encourage selling the highest-margin products, for instance. Choice environments can consist of a commercial offer, where pricing and offer structure influence customers’ choices.

 selling CogniMenu menu engineering

A very concrete example is CogniMenu, a new generation menu-engineering tool developed by ANALYTICA. CogniMenu improves the selling efficiency of restaurants’ menus. The organisation of the menu, its structure and its pricing are all optimised following customer psychology principles. The ultimate goal is to encourage customers to pick highest-margin meals. This directly translates into an increase in average spending and in restaurants’ profits.

 

 

 

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ABOUT THE AUTHOR:

Dr Morgan DAVID   

A former academic and behavioural sciences expert, Dr Morgan David is the founder and director of ANALYTICA, a consultancy agency based in the UK and in France. ANALYTICA uses the way our brain works to design better products and better services in the realm of neuromarketing, webmarketing, customer experience, sales strategy and pricing tactics. ANALYTICA created CogniSales, a neuromarketing sales service, CogniMenu, the first new-generation menu engineering service, and Predicta Sports, a science-based talent identification tool for predictive recruitment in sports.

 

 

billets ventes prix psychologiques

How to increase prices without decreasing sales: 1) Psychological prices

 

billets ventes prix psychologiques

Setting high prices without impeding sales is the neuromarketing aim of all retailers. Here I describe a simple technique to reach that goal via the use of “psychological” prices.

 

 

 

The linear relationship between sales volume and price is a basic selling principle. If customers act rationally, sales volume is expected to decrease as prices increase. Conversely, sales volume should increase when prices decrease. This idea is correct in theory. Indeed, this relationship is commonly found; especially as far as Fast-Moving Consumer Goods (FMCG) are concerned. This is because their prices usually show little elasticity. That does not mean that the above-mentioned negative relationship is true in every context. There are situations where price drops do not cause an increase in sales volume. And others where a price increase does not genuinely lead to sales’ decrease. We could just as well conclude that businesses and retailers suffer from missed opportunities to raise their profits!

 

 

psychological prices

 

 

PSYCHOLOGICAL PRICES

 

Psychological prices are certainly the most popular and used neuromarketing technique. Scientific studies show that consumers’ brains tend to focus on the first digits of prices. For instance, a product priced at £7.99 will appear as less expensive as the same product priced at £8.00; despite the 1 pence difference being minimal. This is because our brain tends to focus on the “7” digit for the first price, and on the “8” digit for the second one.

Offering a product priced at £7.99 instead of £8.00 can potentially help you enjoy a higher sales volume. This will also substantially compensate for the 1-pence loss per product. Indeed, your customers will perceive the £7.99 product as less expensive, and thus more affordable.

Following this rationale, a product priced at £7.00 will be perceived as roughly as expensive as a £7.99 product. In both cases, the price’s first digit is the same (“7”). Pricing your product at £7.00 in this situation should not lead you to enjoy as many sales as you could expect. The price decrease from £7.99 to £7.00 will be perceived by your customers’ brain as less important than it really is. Consequently, you may rather suffer from a profit loss of 99 cents per product (12%). This loss may, eventually, be hard to compensate for with an increase of sales; hence, a missed opportunity to raise your profits.

 

 

Consumers' brains tend to focus on the first digits of prices Click To Tweet

 

 

A DOUBLE-EDGED SWORD

 

psychological prices sales

Please note, however, that psychological prices are a double-edged sword. Prices ending in 9 unconsciously refer to low-quality products. I would, thus, advise against using 9 as an ending for good-quality products. For instance, a high-end restaurant should use round numbers, such as £18, without decimals or options ending with 9. Conversely, a fast-food or casual restaurant would be advised to set its prices according to the psychological prices’ principle (£11.95 for a vegetarian pizza).

 

 

 

Prices ending in 9 unconsciously refer to low-quality products Click To Tweet

 

In a future blog article, I will emphasise the importance of customers’ psychology and the framing of prices for their potential to increase prices and profits.

 

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ABOUT THE AUTHOR:

Dr Morgan DAVID   

A former academic and behavioural sciences expert, Dr Morgan David is the founder and director of ANALYTICA, a consultancy agency based in the UK and in France. ANALYTICA uses the way our brain works to design better products and better services in the realm of neuromarketing, webmarketing, customer experience, sales strategy and pricing tactics. ANALYTICA created CogniSales, a neuromarketing sales service, CogniMenu, the first new-generation menu engineering service, and Predicta Sports, a science-based talent identification tool for predictive recruitment in sports.

 

 

Dominoes communication

9 psychological effects that can ruin your communication campaign

 

Dominoes communication

Communicating is not enough to influence people. Many communication campaigns are an objective failure. This is because providing information is insufficient to persuade and convince. It is crucial to take the psychology of any campaigns’ target into account for messages to be influential. Yet this fact is often ignored in favour of aesthetic and artistic concerns. A poorly designed communication campaign can even have detrimental consequences. I provide here a list of these consequences to be avoided when designing a successful communication campaign.

 

 

Communication professionals are often misled about which techniques can persuade and convince a given target. This is likely because of a lack of objective knowledge about the way our brain works. Detrimental consequences can be generated by the way our brain treats available information and uses it to make decisions. In a scientific article published in the Journal of Communication in 2007, American researchers Hyunyi Cho and Charles Salmon provided a list of unexpected psychological effects that can ruin communication campaigns1. Their study originally focused on health communication campaigns, though the consequences they mention (listed below) can be expected in many contexts.

 

 

1) CONFUSIONcommunication campaign

Confusion occurs when a message’s true meaning is misunderstood (see poster on the right). Cho and Salmon give the example of a prevention campaign for breast cancer. If you stress the importance of check-ups for women with breast cancer cases in their family, women who this does not apply to might feel overly safe and not book an examination. The wording of the messages themselves can also lead to confusion. Claiming that ‘The motorway is not a bin’ to promote the use of bins does not propose any clear recommendation in terms of good practice and behaviour.

 

 

2) DISSONANCE

Dissonance refers to the anxiety generated by the gap between a promoted message and a person’s situation. For instance, promoting breastfeeding can induce discomfort and anxiety in women who, for whatever reasons (necessary medications, low breast milk supply, etc…), cannot breastfeed their child.

 

 

communication campaign3) BOOMERANG EFFECT

Well known by social psychologists, the ‘boomerang effect’ refers to the adoption of a behaviour that opposes the desired behaviour being promoted by the campaign. As depicted on the poster on the left, showing a cheerful group of friends sharing beers is definitely not the best strategy to prevent binge drinking. Also, insisting on the importance of one group member to stay sober to drive the others home, might encourage the others to drink more than usual. And messages high in emotions, such as ‘fear appeals’, are known for distracting the target from understanding and integrating the core prevention meaning2.

 

 

 

4) EPIDEMIC OF APPREHENSION

Apprehension, related to hypochondria, corresponds to an exaggerated concern for health issues due to the pervasiveness of risk messages. For example, a higher sensitivity to thinking one is ill or has the physical symptoms of an illness, in countries where mortality due to infectious diseases remains low.

 

 

5) DESENSITIZATION

Desensitization is defined as the public’s diminishing response to repeated exposure to the same messages. In such instances pervasive TV advertisement campaigns can lead to a rejection of the message or the brand.

 

 

6) GUILTINESS

Guiltiness is an exaggerated focus on personal causes to explain individual health problems. By ignoring related social and environmental causes, people might experience psychological discomfort, low self-esteem, and interpret their state through the sole lens of individual responsibility: ‘I deserve what happens to me because I made the wrong decisions’.

 

 

7) LIMITED ATTENTION/OPPORTUNITY COST

Competition between different communication campaigns to prevent/promote a given behaviour or product tend to make messages less pervasive. This is because people show limited attention, memorization or empathy skills. In a marketing context, people also have limited money and time. Given all the different campaigns targeting people simultaneously, we cannot expect a particular communication campaign to easily reach its target and influence behaviours accordingly.

 

 

8) SOCIAL REPRODUCTION

Social reproduction corresponds to reinforcing a message towards a target segment that is already aware of this message. For instance, promoting waste recycling will have more impact with environmentally-friendly targets than with people who do not feel concerned about environmental issues.

 

 

communication campaign9) SOCIAL NORMING

Akin to the common “in-group/out-group” anthropological divide, social norming may isolate and put the blame on a target group depicted in a negative way, and marginalized within a majority. So, the slogan ‘Kissing a smoker is like kissing an ashtray’ is genuinely not the best message to make smokers aware of the individual, collective and health consequences of smoking.

 

 

In conclusion, here are 9 reasons to expect a communication campaign to fail. Yet social psychologists have become experts in predicting how successful campaigns can be. The good news is that they have also developed the tools to conceive successful messages and content. Does your communication campaign deserve some brainstorming?

 

 

1 Cho & Salmon (2007) Unintended effects of health communication campaigns. J. Com. 57, 293-317.

2 Witte (1991) The role of threat and efficacy in AIDS prevention. Int. Quart. Community Health Educ. 12, 225-49.

 

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ABOUT THE AUTHOR:

Dr Morgan DAVID   

A former academic and behavioural sciences expert, Dr Morgan David is the founder and director of ANALYTICA, a consultancy agency based in the UK and in France. ANALYTICA uses the way our brain works to design better products and better services in the realm of neuromarketing, webmarketing, customer experience, sales strategy and pricing tactics. ANALYTICA created CogniSales, a neuromarketing sales service, and CogniMenu, the first new-generation menu engineering service.