Do you think of yourself as a rational consumer?
Think again, says Intermark Group CEO Jake McKenzie, who recently spoke to the Birmingham Business Alliance’s Birmingham Regional Enterprise Council (BREC) about “The Psychology Behind Buying Power.”
“It all starts with one simple premise,” he said. “You’re not rational.”
We as consumers think we are in control of our buying decisions, but, thanks to many factors, we’re not, he said. McKenzie’s background is in psychology, giving him an unmatched view of changing customer beliefs and behavior. Some of his insights were published recently in Inc. magazine.
Here are some takeaways from McKenzie’s talk at the BREC meeting:
The Law of Least Effort – the less you have to make your customer think, the better.
To help in that effort, your business needs a point of differentiation. Why you? “It’s tough, because this asks us to exclude things,” McKenzie said. “We want to sell everything to everybody.”
The exposure effect – the more times we are exposed to a product, the more we like it. “If all I do is get the name of my company in front of you as frequently as possible, I win,” McKenzie said.
The scarcity principle – “once a product is scarce, our desire for the product goes through the roof, even if we didn’t want it before,” he said. “The fear of loss is unbelievably powerful and makes us irrational.”
The commitment principle – “If I can convince you to say something or write something, the brain will rewire itself to believe it’s true,” McKenzie said.