Because the human brain is a magnificent piece of biological engineering, occasionally defeated by a yellow discount sticker.
Human beings like to think of themselves as rational.
We go through the options carefully, consider the evidence and make sensible purchase decisions based on logic, value and real need.
Then we buy a £200 kitchen gadget as it’s been reduced from £350 and have absolutely no idea what it does at all.
Welcome to the fascinating world of cognitive biases.
Our brains are constantly taking shortcuts to help us cope with an increasingly complex world. Most of the time those shortcuts are absolutely invaluable.
Occasionally they’ll convince you that buying a third air fryer is actually a sound financial decision.
For marketers it’s absolutely vital to understand these mental shortcuts if you’re going to understand consumer behaviour.
What Are Cognitive Biases?
Cognitive biases are systematic patterns of thinking which can affect the way we perceive information, the way we evaluate options and the decisions we make.
Rather than go through all the available facts, our brains tend to rely on what we’ve experienced before, on our emotions and on the patterns we’re used to.
This enables us to make decisions rapidly.
Unfortunately ‘quick’ doesn’t necessarily mean ‘right’ and purchase decisions are particularly prone to these psychological shortcuts.
Here are seven cognitive biases every marketer should know about.
1. Anchoring Bias: The First Price Changes Everything
Imagine seeing a waterproof jacket costing £300 and deciding it’s too expensive, but then you spot it’s been reduced from £600.
Suddenly £300 seems quite reasonable.
You haven’t saved £300. You’ve spent £300.
But your brain is already patting you on the back for your financial genius.
Marketing lesson: the first price or reference point that a customer sees has a massive impact on how they subsequently judge the value of other offers. The clearer and more honest the comparison, the better.
2. Confirmation Bias: We Believe What We Want to Believe
People will naturally tend to favour information that supports what they already believe.
If you’re the sort of person who’s absolutely convinced that a certain car manufacturer makes the best cars in the world you’ll be sure to spot the glowing reviews and at the same time be perfectly happy to ignore the reports of engines turning into rather expensive garden ornaments.
This is confirmation bias.
Marketing lesson: understand your customer’s existing beliefs and concerns. Use the evidence, the demos and the real customer experience rather than just telling them what you think they want to hear.
3. The Bandwagon Effect: Everybody Else Has One
There’s something comforting in the knowledge that other people have already made the same decision.
That’s why customer reviews, testimonials and the general level of popularity can all have an effect on a purchase.
If 10,000 people have bought something then surely they can’t all be wrong?
Of course history suggests otherwise.
But the brain does like a crowd.
Marketing lesson: real reviews, real customer stories and demonstrable evidence of uptake can go a long way to reassure the prospective buyer. Just don’t go in and invent 47 enthusiastic customers all called Dave.
4. Loss Aversion: Missing Out Feels Terrible
People can be more sensitive to potential losses than to equivalent gains.
This goes some way to explaining why the prospect of losing a discount, of missing a deadline or of simply wasting money can all have an impact on a decision.
It’s also why someone who completely had no intention of buying a garden shed yesterday might suddenly be in the market for one the moment the site says there are only two left.
Marketing lesson: Show how your product enables customers to avoid real problems, avoid unnecessary costs and avoid missed opportunities. Artificial scarcity and imaginary deadlines are absolutely perfect ways of destroying trust.
5. The Halo Effect: One Good Thing Changes Everything
The halo effect is where a positive impression in one area leads to a positive judgement in another.
A beautifully designed website would lead you to think that the company is professional, reliable and competent. Even the website tells us zip as to whether the company can actually deliver a working boiler.
Similarly attractive packaging can have an effect on how we view the quality of the product itself.
Marketing lesson: good design, clear communication and a professional presentation can go a long way to create a positive first impression. The actual customer experience is still what will ultimately determine whether that impression is maintained or not. A good logo will do nothing to save a terrible product.
6. The Availability Heuristic: If We Remember It, It Must Matter
Our brains are very good at judging how likely or how important something is on the basis of how easily examples come to mind.
This is the availability heuristic.
It’s one of the reasons that a good story, a vivid example and a well known brand can have such power.
A story of a product failure can be a far more memorable story than thousands of unremarkable purchases.
Marketing lesson: make your messages easy to understand and easy to remember. Use stories, use examples that are relevant and use distinctive brand cues. Because being memorable is rather useful when you’re in a position where the customer has to eventually pick between you and seventeen rather suspiciously similar competitors.
7. The Status Quo Bias: Better the Devil You Know
People will often prefer things to stay as they are. Even when a better alternative is available.
Changing suppliers, switching software or going down the route of a new service can all seem a bit of a risk and a bit of an inconvenience.
This is absolutely pertinent in the B2B space where changing a system could well involve retraining the staff, reworking the processes and then having a meeting with the finance director to explain why everything has suddenly gone up in price.
Marketing lesson: reduce the uncertainty. Do demonstrations, explain the switch, give reassurance and make it as easy as possible for the customer to understand the benefits of the change. Sometimes the biggest competitor isn’t another business. It’s doing absolutely nothing.
How Should Marketers Use Cognitive Biases?
Now before you go off and build a campaign involving fake countdowns, celebrity endorsements and a very large number of five star reviews indeed… a small word of warning.
Understanding cognitive biases is in no way a licence to manipulate people.
These are principles of a kind, not absolutes. Their effect will vary from person to person, from situation to situation and depending on the decision in question.
Good marketers use behavioural science to communicate more clearly, to reduce friction and to help people make the right decisions.
Bad marketers will use it to sell you on the absolute necessity of a £200 kitchen gadget which does exactly the same job as a saucepan.
The distinction is important.
The Most Important Thing to Remember
People don’t make their purchase decisions on logic alone.
Their choices are all shaped by familiarity, emotion, experience, perception and the mental shortcuts that our brains take to get through life.
Understanding these influences enables marketers to create more relevant messages, stronger brands and better customer experiences.
But perhaps the most important lesson is that customers aren’t perfectly rational decision makers.
They’re human beings.
Which explains a massive amount about marketing, and rather less about why there’s a third air fryer in the kitchen.
More Marketing Psychology, Less Marketing Nonsense
Why do some brands remain in our memory for decades and others just vanish almost as soon as you’ve heard of them?
In Episode 17 of The Overthinker’s Guide to Modern Marketing Podcast, we explore the psychology of memory, brand distinctiveness, and why getting noticed isn’t the same as being remembered.
Listen to Episode 17: The Science of Being Memorable
Because understanding how people think is rather important when you’re trying to influence what they do. Preferably without selling them another air fryer.
