Customer Psychology Frameworks
One of the first rules in making your business successful is to know your target audience or, to be more specific, who your customers are. Therefore, it is imperative that businesses should look closer at their customers: who they are, what they want, what motivates them, what drives their decisions… basically, businesses should have a clear idea what makes their customers tick.
When we speak of psychological models in understanding the customer, it involves trying to understand their motivations and their need for recognition. These frameworks and models are more qualitative in nature, since they are mostly derived from sociological and environmental factors, such as culture, social influences, and the like.
In this article you will learn about 1) the basics of customer psychology, 2) the behaviorism perspective on customer psychology, 3) the cognitive approach to customer psychology, and 4) the cognitive-behavioral perspective on customer psychology.
BASICS OF CUSTOMER PSYCHOLOGY
All too often, we see customer psychology and marketing mentioned together, like peas in a pod. And why not? Both concepts are as old as time, and are closely related that they seem to be interdependent on each other. We just cannot talk about marketing without touching on customer psychology, and vice versa.
Watch this very inspiring talk Catherine Roe and learn from some real-life examples.
Customer psychology, or what others also term as “consumer psychology”, has been defined as the study of why people buy things. From the point of view of a business that sells products or services, it is a tool that you can use in order to get what you want from your customers. It basically entails looking into, and understanding, the behavior of consumers. How do they go about selecting, acquiring, using, and disposing products and services that satisfy their needs?
Customer psychology also takes into account external factors, delving deep on the matter as to how the customer is influenced by his environment. What role does mass media play in his buying decisions? How big of an impact does culture have on how he chooses the products he buys or the services he avails of?
But why is it really necessary for businesses to get customer psychology down? Yes, we have all established that doing so will help ensure the success, profitability and growth of the business, but how?
- Marketers and business people are especially interested to know how customers purchase, use, and dispose of products. This is so that they will get a better idea on how to best position these products and services. The majority of marketing decisions are influenced by the behavior of customers, particularly when they are buying something. Marketing campaigns, programs and strategies are largely hinged on what the marketers learn about the consumers.
- Product developers can also take their cues from the information gathered through understanding customer psychology. For example, they will know how they can further develop products that will encourage or entice consumption. This takes into account the reality that the decision strategies employed by customers differ depending on the product offerings.
- Consumer behavior also has greater impact on society as a whole. Their decisions, choices, and reasoning behind these decisions could have a relevance on larger issues, such as the economy, environment, and national health.
Customer psychology is, admittedly, a very broad subject, considering how multi-faceted the customer is. We will attempt to take a closer look at how we can understand our customers and get to know them better.
There are a few major theoretical approaches put at work when it comes to understanding consumer behavior and we will look into three of them.
If you have a little time, then go thorugh this fully fledged presentation to get a greater understanding on consumer behavior.
THE BEHAVIORISM PERSPECTIVE
According to the concept of consumer behaviorism, customers’ actions are driven by external stimuli or outside influences. They make their decisions because they were made to do it. There is a cause and effect mechanism at work, and all the behaviors are results of conditioning. With the right conditioning, using the right external stimuli, businesses can influence and even train their customers to react in a certain manner; in this context, to buy their products. The most common examples of external stimuli including brand and brand loyalty, packaging and aesthetics. Meanwhile, when we talk about conditioning consumers, the first thing that comes to mind is aggressive advertising, often marked with repetitive exposure of these advertisements. Recency, or keeping things current, is another tack that marketers use to grab their customers’ attention and condition them so as to influence their behavior.
Take, for example, a brand of detergent. It is relatively new in the market, and it is entering a market that has long been dominated by several other brands. However, the manufacturer and marketer have become aware that their target audience has a close affinity to certain celebrities, resulting from constant exposure to the works of these personalities. Therefore, they integrated those specific celebrities in their advertising campaigns, which will then strike a chord in the consciousness of the consumers. As a result, the consumers are more likely to be convinced to buy that detergent brand.
This perspective holds that culture, mental processing, genetic background and personality traits are independent of the customer’s ability or decision to buy something. In the example above, the consumers have been conditioned by almost constant exposure to these celebrities. They have become repetitive that they are now classified as naturally-occurring stimuli. Therefore, once the stimuli (the celebrities) have been paired with the conditioned response (to buy a product they endorse), the consumers will be inclined to buy them. This is conditioning at its best, especially when, after a period of time, it will come to a point where the consumers will continue purchasing the product, even if the celebrity is no longer associated with it.
Understanding Customer Behavior
Marketers and psychologists alike get their information on consumer behavior from one method: research. They employ various research techniques and strategies in order to get the information they are seeking about the consumers. But how, exactly, do they go about it?
Research, research, research.
This is probably the most logical step in gathering relevant information. First, the research would focus on the target audience. Consumer psychologists often start by learning who the target audience is for a particular product or service. They will identify who the typical or representative customer or shopper is and, from there, learn about his age, gender and socioeconomic status.
This also includes the conduct of research on the product types. After getting to know the typical customer, they will look into the types of products that may appeal to that customer segment. This also includes figuring out which marketing messages have higher chances of appealing to the consumer’s sensibilities, or just grab his or her attention.
There are many research techniques or methods employed by consumer psychologists, such as:
- Focus groups. In this approach, psychologists gather a group of people and present them with the products or services being sold, or planned to be sold. The group will then provide their opinions and thoughts regarding the products. It is important to note that the group will be allowed to interact and discuss in a non-threatening and comfortable environment.
- Direct observation. In this technique, the researchers go out into the “field”, personally participating in situations so they can see or observe firsthand the setting that they are researching on. They will play the role of a direct observer, without necessarily participating actively or becoming a part of the process in any way.
- Phone surveys. Questions are relayed to customers over the phone, with the phone conversations often recorded for future reference.
- Surveys via questionnaires. One of the most common methods for market research is floating a questionnaire. They could be in physical hard copies (pen and paper) or distributed through direct mail and e-mail. This is actually one of the most preferred methods, since the ones conducting the survey can ask as many questions as they want about the consumer, enough so that the answers will enable them to build up their profile. In contrast to the focus groups method, this technique is ideal if you are trying to collect data that is quantifiable.
Focus on social marketing.
In this day and age, social marketing has become an integral part of any business marketing strategy. Social marketing typically covers how messages, ideas and information about products and brands are spread within and among various groups.
Being available on social media is one of the most important aspects of social marketing.
Be customer-oriented by making your brand accessible.
You want to understand customers; it follows that you should focus on them. If only businesses are able to read their customers’ minds, then there would be no issues at all. Unfortunately, that is not the case, so they have to work for it.
This fully acknowledges the fact that consumers are becoming wiser and more circumspect than ever. Yes; they, too, do their own research. They, too, have ways and means to look for and obtain the information that they need regarding a product or a service. In the past, before technology became so advanced and the internet was not yet around, the only way they can get information is through watching advertisements, reading the dailies, and talking to other people, obtaining their information through word-of-mouth. Today, there are more ways for customers to access information. A single click can easily lead them to a list of blog posts, customer reviews and testimonials about the product or service. They can even check out the websites of competitors and get information from them.
Customer psychology deems this to be natural behavior among consumers, which is why the most logical step that should be taken by the company is to bring the customers a step closer to the information that they are seeking.
Use tools at your disposal.
There are several helpful tools that can help you get to know your customers better, and they include Google Analytics and Webmaster tools. The data generated by these tools will let you see exactly what the users who visited your company website are looking for.
THE COGNITIVE APPROACH
Next up is the Cognitive Approach, which perceives consumers as individuals who are processors of information, with the ability to perform higher mental processes. There are two systems at work within the environment: the affective system and the cognitive system. This means that the affective responses – feelings, emotions, and moods of consumers – are interrelated with their cognitive responses – their beliefs and knowledge – and vice versa.
This approach recognizes the significance of external stimulus, and how it influences one’s behavior and, inevitably, his or her buying decisions. The stimulus enters the picture, and it automatically generates an effective response from the consumer. The cognitive system will then interpret the affective response, and this is the consumer’s mental processing at work. In the end, the consumer will come up with his own deduction or decision from his cognitive interpretation.
Affective responses are those that consumers feel; they could not help or control these responses. For instance, a female consumer automatically reacts positively towards the color red of a luxury bag, since it was a color that has always attracted her. The red color is the physical stimulus that triggered the response. Another possible affective response would be surprise at how expensive the luxury bag is.
Cognition will then follow, where the female consumer will evaluate the implications of the color and the price. She will then try to understand the concept of luxury bags, and previous thoughts, opinions and beliefs about luxury bags – and spending money on them – will come into play. How does she personally feel about them? What does her friends and family think about the whole idea? She will then evaluate whether buying the red luxury bag is a good investment or not.
Part of her mental processes are also likely to involve evaluating her own finances (can she afford the bag?), looking at alternatives and making comparisons (are there other similar bags?) and selecting the best among them, and thinking if purchasing it is a good decision all around.
In this approach, everything is connected: the external stimuli, the customer’s rational and cognitive thinking, and his mental processing. All these combined will ultimately make him decide whether to buy something or not.
In the detergent examples used previously, consumers’ decision to buy the product will not be influenced solely by the fact that they are associated with celebrities they are exposed to on a regular, almost constant, basis. The customer most likely did his own research into the offerings of the product, analyzed if it is beneficial and worth his or her money, then made the decision whether to buy or not.
THE COGNITIVE-BEHAVIORAL PERSPECTIVE
This is an integrated framework that combines both principles of the behavioral and cognitive views. This approach holds that the thoughts, feelings, and behavior of consumers are causally interactive. Consumers are also said to respond to cognitive representations of their environment, instead of those environments per se.
In other words, cognitive-behavioral perspective means that the consumer will be subjected to some conditioning, while allowing him to mentally process things and come up with cognitions, which will eventually lead to a buying decision.
When we look closely at the purchase behavior of consumers, we will find the following driving factors:
- Their physical environment
- Their social environment
- The consumers’ own behavior
- The processes of the consumers’ affective and cognitive systems
A classic application would be using a model to demonstrate how a product is being purchased or used. The consumer is the one to develop the “product script”; it just needs a little push or conditioning. In the example given earlier, this is also applicable when the company’s advertising campaign had the celebrities demonstrating how to use the product, and saying a few things that will resonate with the consumer. It still ultimately gives the consumer the final say or decision to mull over.
The affinity or feeling of closeness that many consumers have towards brands is a perfect representation of the cognitive-behavioral perspective. Through advertising and marketing, businesses are able to condition the consumers, shaping their knowledge and belief or cognition about the brand’s product attributes, as well as the consequences of using the brand and the applicable and appropriate consumption situations for these brands. Their affective responses will then have stemmed from this conditioning.
This is also partly responsible for the existence of that which many call as “personal biases”. From conditioning efforts made by companies, consumers have a tendency to develop biases, which then creep into their buyer decision-making processes, often without them realizing it. These cognitive biases will inevitably have an influence on their mental processes, for when they make evaluations prior to deciding whether to buy or not.
We cannot blame businesses and marketers for finding customer psychology to be one of the toughest aspects of marketing. It is quite complex and, let’s face it, requires substantial effort and resources. However, no one can deny the crucial role that it plays in a company’s efforts to achieve its business goals.
We keep hearing news stories and anecdotes about this “successful business” or that “entrepreneur …