Sunday, April 25, 2010

Consumer Marketing Techniques and Tribes

Most of us like to think that we're too sophisticated to fall for marketing tricks. We know that "new" and "improved" don't necessarily mean a product is really new or improved. We know that larger boxes and bottles of some products are usually, but not always, less expensive per ounce than smaller sizes. We know that added bells and whistles don't always mean better quality items. But the reality is that marketing pros are consistently at least one step ahead of us when it comes to manipulating our buying habits.

I've mentioned in a previous post the book Predictably Irrational: The Hidden Forces That Shape Our Decisions by Dan Ariely, but I'd like to take a closer look at a few specific observations that he discussed and offer my own assessment of what ultimately motivates us to make purchasing decisions.  Also, FYI, a "revised and expanded edition" of Predictably Irrational will be released on April 27th; I assume it really is revised and expanded!

(Thanks to the blogs "Coding Horror" and "SEOmozBlog" for providing the quotes that form the basis of the first three items.)

Relative Thinking and "Saving Money"

"When Williams-Sonoma introduced bread machines, sales were slow. When they added a 'deluxe' version that was 50% more expensive, they started flying off the shelves; the first bread machine now appeared to be a bargain."

"When contemplating the purchase of a $25 pen, the majority of subjects would drive to another store 15 minutes away to save $7. When contemplating the purchase of a $455 suit, the majority of subjects would not drive to another store 15 minutes away to save $7. The amount saved and time involved are the same, but people make very different choices."

Clearly, we like to believe we're rational when it comes to saving money on purchases, but we're not. We often fall down on the job of accurate comparison shopping. A related trap, this one self-imposed rather than inflicted by clever marketing, is spending an inordinate amount of time shopping for an item at a lower price. Driving across town to save less money than we'll spend on gas is counter-productive; so is driving across town if our time is more valuable than the money we'll save by shopping somewhere inconvenient.

Artificial Markets

"Savador Assael, the Pearl King, single-handedly created the market for black pearls, which were unknown in the industry before 1973. His first attempt to market the pearls was an utter failure; he didn't sell a single pearl. So he went to his friend, Harry Winston, and had Winston put them in the window of his 5th Avenue store with an outrageous price tag attached. Then he ran full page ads in glossy magazines with black pearls next to diamonds, rubies, and emeralds. Soon, black pearls were considered precious."

The creation of an artificial market is not exclusive to luxury items. For example, gadgets of all sorts have been invented ostensibly to make our lives easier, but many are totally unnecessary. Responding to the instant appeal of ultimately useless gadgets can drain your bank account and fill your home with clutter. (See the Unclutterer blog's amusing "Unitasker Wednesday" items for examples of these gadgets.)

Price and Perception of Value

"Ariely, Waber, Shiv, and Carmon made up a fake painkiller, Veladone-Rx. An attractive woman in a business suit (with a faint Russian accent) told subjects that 92% of patients receiving VR reported significant pain relief in 10 minutes, with relief lasting up to 8 hours.

"When told that the drug cost $2.50 per dose, nearly all of the subjects reported pain relief. When told that the drug cost $0.10 per dose, only half of the subjects reported pain relief. The more pain a person experienced, the more pronounced the effect. A similar study at U Iowa showed that students who paid list price for cold medications reported better medical outcomes than those who bought discount (but clinically identical) drugs."

Although we say we want value, we often are suspicious when it's offered to us. This is why many brand names have greater appeal than their generic equivalents. Of course, anyone who's tried a generic product (not a drug with a specific active ingredient, but simply a "store brand" item) and found it to be genuinely inferior will be justifiably cautious in future money-saving purchases. On the other hand, at what point does an expensive car, for example, become worth its price? If a car were simply transportation, there would be no reason to pay a premium. But a car is an aesthetic statement as well as a public proclamation of status. Once status becomes an issue, all bets are off and the marketing mavens have a field day.
Buying the Image, Not the Item
Let's face it. The real reason that we buy anything beyond basic food staples that keep us alive is that we are making a statement about who we are or who we aspire to be. Not only are human beings visual creatures who respond primarily to appearances, but we are also social creatures who are constantly tuned into the hierarchies of status around us. We choose (or struggle to choose) an image that works for us and the "tribes" we want to affiliate with, then we gather the associated trappings. If you shop at Victoria's Secret and I shop at LL Bean, that says something about each of us and the tribes we identify with. If you drive a Mercedes and I drive a Honda, that speaks volumes, too. If you say that diamonds are a girl's best friend and I say that a girl's best friend is her dog, marketing pros are going to know exactly how to push each of our buttons to get us to reinforce our personal visions and our tribal affiliations.
Every label you put on yourself, or that society imposes upon you, puts you in a tribe:
young/old/mom/dad/dancer/writer/accountant/athlete/conservative/liberal/city dweller/nature lover/quiet/outgoing, etc. The labels you identify with most strongly are your most significant tribes and are usually most visible in your personal style and your lifestyle. We like to think that we're individualistic in our choices, especially in this society where individuality is such an admired characteristic, but I think that's rarely the case. I believe that the tribal connections are generally more powerful than our individual inclinations. Few of us are as bold as Lynn Yaeger when it comes to personal style and perhaps even in her case an argument can be made that embracing an exceptionally unorthodox look puts her in a tribe of "rebels" or "iconoclasts." 
Whatever our personal styles and tribal affiliations may be, if we become truly aware of them, of who we think we are and what statement we want to project to the world, we can make decisions that are comfortable for us. Or we can reject our status quo and reinvent ourselves. Either way, we can start taking charge of all that clever marketing information and use it to our advantage instead of being manipulated by it.
Who are you? What are your tribes? How does what you buy reinforce your image of yourself and what you project to the world? Can you spot instances in which you were manipulated? Do you feel empowered to make satisfying choices in the future?
© 2010 Cynthia Friedlob
Photo credit: Avalore @ stock.xchng

Related posts:
Advertising's Assault on Our Senses
Style, Advertising and the Cool Factor
Advertising to Children in a Consumer Society