As the global marketplace expands and evolves, consumer psychology is integral to understanding consumer needs and building more effective marketing strategies. But what does studying it involve? To give an overview, it examines what influences people to make specific purchasing decisions, including understanding their wants and needs.
This article will briefly discuss consumer psychology and its relevance to businesses, marketers and individuals. We’ll also discuss how to learn more about this topic at SACAP Global.
What is consumer psychology?
Consumer psychology studies the psychology behind consumer behaviour. While the idea might seem simple, there are many layers of complexity when considering what influences how, why, and when people buy products and services. For example, what psychological processes influence a buying decision? Are there emotions involved? And how do social and cultural factors influence consumer behaviour?
We can look at all three of these concepts to dig deeper. Firstly, psychological processes such as memory and attention affect how we think and behave as consumers. Why do we pay attention to specific marketing messages and not others? How do businesses sell their products and services to their target market?
Secondly, emotional aspects have a role to play. While we might buy certain products and services out of need, such as cleaning products, why do we choose one brand over another? Branding appeals to an emotional aspect of ourselves in that we resonate with brand values and even the look and feel of product packaging.
Thirdly, social and cultural factors also influence consumer behaviour. If we aspire to live a particular lifestyle, we choose products and services that resonate with how we want to be perceived, even subconsciously. Trends, influencers and even social realities can drive our consumer decision-making processes. These decisions include everything from the clothes we buy to how we build and design our houses (for example, installing solar panels to combat load shedding).
Even from this brief outline, there is much to unpack about why consumers spend and behave as they do. However, what are the other benefits of studying consumer decision-making beyond being interested in how people spend their money?
Why should we understand consumer psychology?
Beyond satisfying our curiosity about why people make purchasing decisions, studying consumer psychology has many benefits from a business perspective. Firstly, we can create more effective marketing and advertising strategies by exploring consumer behaviour. Before anyone takes the time to make an advertisement, we must do relevant market research to understand whether or not the product or service meets a consumer need. From there, we can tailor more effective marketing messages based on what resonates with potential customers or clients.
Secondly, beyond creating more effective marketing strategies that speak to the target audience, studying consumer decision-making can help ensure that customers and clients are better satisfied. Thirdly, with better marketing strategies and favourable customer experiences, businesses can increase their sales and revenue and, in turn, continually improve how they design and market their products and services.
Importantly, the world is evolving rapidly in terms of technological engagement. Thanks to developments such as artificial intelligence, augmented reality, and social media, what once worked to engage consumers is changing. Therefore, it’s essential to understand what drives people and how to communicate with them effectively through various channels, which can open up many different opportunities for engagement.
For example, a brand giant like Netflix consistently does market research by getting users to “like” or “love” their selection of TV shows. By using these recommendations and analysing customer data, Netflix can provide recommendations to users, thereby driving greater customer satisfaction and improved user experience.
Practical applications of consumer psychology
If you work for a large company or run your own business, it might be more obvious why studying consumer decision-making could be valuable. For example, understanding how consumers think and behave can help create more effective marketing strategies, build better products and services, and ensure optimal retail and e-commerce user experience.
However, consumer psychology applies to any organisation, not only to fast-moving consumer goods (FMCG) and services. Governments, social enterprises, and other non-profit organisations can benefit from understanding consumer behaviour. Some ways that these types of organisations can benefit from studying consumer behaviour include brand loyalty and improved engagement, as well as promoting sustainability and wellbeing.
Therefore, studying consumer behaviour is not only about selling and making a profit. It’s about creating optimal experiences for all consumers. Regardless of a consumer’s socio-economic background, all organisations can benefit from an increased understanding of the psychology of human behaviour, especially as it applies to purchasing decisions.
Career opportunities in consumer psychology
As we’ve touched on above, all organisations can benefit from understanding their customers and clients better, regardless of whether they are profit-driven or providing a social service. Therefore, there are many ways that a qualification in consumer psychology can add value in the marketplace. Here are some ways that organisations can benefit from this kind of know-how:
- Marketing and advertising: As discussed in this article, understanding consumer behaviour can help build more effective sales and marketing strategies in any business or organisation. Market research is key here, but this understanding can also expand into translating consumer insights into brand strategy and digital marketing elements such as user experience (UX) design on websites.Â
- Brand management: Beyond selling products and services, a solid understanding of consumer behaviour assists in optimal brand management, which applies to any organisation, regardless of its offering.Â
- Technological adaptability: As the world continues to evolve, compelling consumer insights and data analytics can help brands and businesses adapt to the times, including using more technology-driven forms of engagement, such as artificial intelligence (AI) and augmented reality.Â
- Problem-solving ability: As the world becomes more data-driven, learning about consumer behaviour can help develop relevant analytical and problem-solving skills that you can apply in various environments.
- Improved customer communication: Communication with customers and clients is integral to running an effective business or organisation. Understanding consumer wants and needs is essential to communicating effectively, not just to sell but also to provide an optimal brand experience.
- Education: Someone with training in consumer psychology can educate people in this field and work for a business to improve customer experience.Â
Learn about consumer psychology at SACAP Global
In this post, we’ve given a brief overview of what studying consumer behaviour involves and why it is valuable. In a changing world, it’s essential to remain relevant and competitive, which demands staying in touch with changing consumer trends and technological developments.
If you want to learn more, register for the Intro to Consumer Behaviour and Psychology on-demand short course. In this online course, you’ll learn analytical skills to evaluate consumer decision-making processes and how to apply these to real-world scenarios.
You’ll also get hands-on experience creating compelling marketing messages for target audiences. Other considerations include navigating the implications of the Fourth Industrial Revolution (4IR), which requires using technology to create better customer experiences.
Other related courses that you might also be interested in include:
- Intro to Human Behaviour
- Domains of Psychology
- Social Psychology: How Social Influences Impact Behaviour
- Effective Interpersonal Communication
Related Courses
Intro to Consumer Behaviour & Psychology
Investigate the underlying motives, cognitive processes and emotional factors that drive consumer behaviour.
Domains of Psychology
Explore the core schools of thought in psychology. Understand the biological and neuropsychological functioning of the human mind and body.
Social Psychology: How Social Influences Impact Behaviour
Understand how your thoughts, feelings, and behaviours are influenced by the presence of others.
Effective Interpersonal Communication
Develop your communication skills. Learn how to communicate clearly with friends, family and colleagues.