Consumer Psychology Is The Only Constant In A Changing Retail MarketAugust 23, 2020
Years ago, Jeff Bezos famously said:
“I very frequently get the question: ‘What’s going to change in the next 10 years?’ And that is a very interesting question; it’s a very common one. I almost never get the question: ‘What’s not going to change in the next 10 years?’ And I submit to you that that second question is actually the more important of the two — because you can build a business strategy around the things that are stable in time.”
He went on to explain that what is not going to change is that customers will want low prices, fast delivery, and vast selection. He is describing motivations that are part of unchangeable consumer psychology on which he based Amazon’s business strategy.
But Bezos’ truths – low prices, fast delivery, and vast selection – address one small part of consumer psychology: consumers’ functional needs. He isn’t telling all he knows about a much more complex story of why consumers do what they do and buy what they buy.
Jeff Bezos understands consumer psychology
“Shopping behaviors are always a means to an emotional end,” says Buycology founder Chris Gray, psychology Psy.D in clinical psychology.
So retailers need to focus on these core human motivations that shape shoppers’ behaviors. And importantly, these underlying human motivations give other retailers plenty of ammunition to beat back the onslaught of a retailing giant, like Amazon
“Consumers are people and people are driven by the same core needs,” explains social psychologist Erica Carranza, Ph.D., vice president of consumer psychology at Chadwick Martin Bailey.
“We all strive to maximize positive emotions, enhance and express our identities, cultivate social relationships, and effectively achieve our goals. Because these are core human needs, brands that help people fulfill these needs drive consideration, trial, loyalty, and advocacy,” she says and adds, “People are three-times more likely to try a brand if they expect it to deliver strong emotional, identity, social, or functional benefits.”
And people give different weights to these core psychological needs under different circumstances based upon the context in which they find themselves. This year with the pandemic rearing its ugly head, the deck of consumers’ psychological needs got shuffled but never went away.
Here are five essential truths of consumer psychology Bezos isn’t telling about: control (Bezos’ functional needs), emotion, personal identity, social belonging, and context.
Giving consumers control
People want to feel in control and that they can achieve what they want to achieve. In psychological terms, this is called agency. “It’s about their ability to efficiently and effectively achieve their goals,” Carranza explains. “Amazon’s functional benefits give people that sense of agency that they can shop…