Psychology in Marketing: 10 Principles That Drive Sales
Ten principles with strong research records, from social proof to fluency. Each comes with one verified finding in plain words and one honest way to use it.
Answer to the question
What Are the Main Principles of Psychology in Marketing?
Psychology in marketing applies research on how people judge and choose. Ten principles with strong evidence are social proof, reciprocity, scarcity, anchoring, framing, loss aversion, the middle option, defaults, familiarity and fluency. Each works best when the signal is true: real best sellers, real limits and defaults that suit most customers.
Key takeaways
- In a randomised restaurant experiment published in 2009, Hongbin Cai, Yuyu Chen and Hanming Fang found that a ranking of the five most popular dishes raised demand for those dishes by 13 to 20 per cent.
- In two experiments by David B. Strohmetz and colleagues, published in 2002, diners who received chocolate with the bill tipped more than diners who received none.
- Tatiana A. Homonoff reported in 2018 that a five-cent charge on disposable bags cut their use by more than 40 percentage points, while a five-cent bonus for reusable bags had virtually no effect.
- In Irwin Levin and Gary Gaeth's 1988 study, beef labelled 75 per cent lean was rated more favourably than beef labelled 25 per cent fat, and tasting it narrowed the gap.
- Brigitte Madrian and Dennis Shea found in 2001 that automatic enrolment raised retirement plan participation sharply, and that many employees kept the default settings.
Two shops can sell the same product at the same price and see very different sales.
The gap opens because buyers rarely judge a product on its own. They judge it against the first price they saw, the option beside it, the box already ticked and the people who bought before them. Psychology in marketing studies those surroundings, and ten of its principles have unusually strong research records.
Robert Cialdini's Influence makes the case that a small set of principles accounts for most everyday persuasion, and that they work because they are usually sensible shortcuts: what many people choose is often good, and a favour usually deserves a return. That is also the case for psychology in marketing used honestly. A shortcut that leads buyers somewhere good keeps working for the brand that offers it, and one that leads them astray teaches them to stop trusting the signal.
Psychology in marketing starts with what other people already choose
1. Social proof. Buyers read other buyers' choices as information. In a randomised field experiment in a restaurant, Hongbin Cai, Yuyu Chen and Hanming Fang found that showing diners a ranking of the five most popular dishes raised demand for those dishes by 13 to 20 per cent, with modest signs that occasional customers responded more. Naming a few sample dishes, which made them more noticeable without saying anything about popularity, had no significant effect, so the lift came from learning what others chose. The norms research behind the principle is set out in What is social proof in marketing.
2. Reciprocity. A small, unexpected gift creates a wish to give something back, a pattern Reciprocity at the Sample Tray follows into free sampling in shops. David B. Strohmetz and colleagues ran two experiments in which restaurant servers handed diners chocolate with the bill. Diners who received a piece tipped more than diners who received none, and in the second experiment tips varied with how much candy was given and how it was offered. The authors judged reciprocity a better explanation than a good mood or the server managing impressions. A business applies the same principle by giving something useful first, such as a sample, a guide or a fitting, with no condition attached.
3. Scarcity. Things in short supply look more valuable, and the reason for the shortage changes how much. Stephen Worchel and colleagues asked people in 1975 to rate cookies that were plentiful or scarce. Cookies that became scarce were rated more desirable than cookies that stayed plentiful, and a shortage put down to high demand lifted ratings more than one put down to an accident. The practical rule follows from the second result: state how many are left only when the number is real, and say why, because a run that sold out on demand tells a buyer something a production delay does not. Which Kind of Scarcity Works on You sorts the main types of scarcity message.
How do first prices and word frames set the value?
4. Anchoring. The first number a buyer meets pulls later estimates towards it, as the classic demonstrations in Why the First Price You See Decides What You Pay show. Thomas Mussweiler and colleagues describe the effect as highly robust, and in a study with experts working in a real setting they found that listing arguments against the anchor they had been given reduced its pull. A seller can use the first half of that honestly by leading with a genuine reference point, such as the price of the full service before a smaller package is shown. A buyer, or a sales team checking its own forecasts, can use the second half.
5. Framing. The same fact described two ways is judged two ways. In Irwin Levin and Gary Gaeth's 1988 study, consumers rated ground beef labelled 75 per cent lean more favourably than beef labelled 25 per cent fat, and the gap narrowed once they had tasted it, because direct experience diluted the label. A positive frame helps most before purchase, and afterwards the product speaks for itself, so a frame that promises more than the product delivers is corrected at the first taste. What is the framing effect traces the wider research on frames.
6. Loss aversion. A loss weighs more than a gain of the same size, though how much more is debated in Loss Aversion and the Bet You Turn Down. Tatiana A. Homonoff compared two policies with the same five-cent stake: a charge on each disposable shopping bag and a bonus for each reusable one. The charge cut disposable bag use by more than 40 percentage points, while the bonus had virtually no effect on behaviour, a result she reads as consistent with loss aversion. In psychology in marketing, the honest version is to state plainly what a customer stands to keep or give up, such as the saving a plan locks in, and never to invent a loss.
Middle options, ticked boxes and the settings buyers usually keep
7. The middle option. An option gains share when it sits between two others. In studies reported by Itamar Simonson in 1989, with products ranging from televisions to mouthwash, an option drew more choices when it became the middle of a range in nine of eleven tests, and choosing the middle was seen as the safer course. Its close relative, the decoy effect, has its own record in What is the decoy effect.
8. Defaults. Whatever is already selected tends to stay selected, and Why You Never Change the Setting covers the wider evidence. Brigitte Madrian and Dennis Shea found that participation in a workplace retirement savings plan was far higher once employees were enrolled automatically, and that many kept the default contribution rate and fund even though few would have chosen those settings beforehand. They point to inertia and to employees reading the default as advice. That second reason carries a duty. A pre-ticked option is taken as a recommendation, so it should be the one most customers would choose with time to think, and changing it should take one click.
Why the familiar and the easy both read as good
9. Familiarity. Four women attended a large university class 0, 5, 10 or 15 times over a term in the study by Richard Moreland and Scott Beach. At the end, students' liking for each woman, and their sense of how similar she was to them, rose with the number of times she had attended, while ratings of familiarity changed little. The marketing version is steady, consistent presence in the places a buyer already looks, with the same name, colours and voice each time. What is the mere exposure effect sets out the longer record.
10. Fluency. Statements naming a city and its country, printed in colours that stood out strongly or weakly against a white background, were more often judged true when they were easy to read, in work by Rolf Reber and Norbert Schwarz that The Brand You Can Pronounce applies to names. They concluded that ease of processing shapes truth judgements on its own, apart from how often a statement has been seen. For a brand, clear type, plain wording and a name that is easy to say are courtesies that also help a true claim land.
Each of the ten works by carrying information a buyer would want anyway: what others chose, what is genuinely limited, which option suits most people, what an item is really like. Used that way, psychology in marketing makes a good offer easier to recognise and leaves customers with purchases they are glad to have made, from sellers whose best sellers, stock counts, ticked boxes and plain labels they have learned to believe, and whom they will want to return to the next time they need something similar.
Common questions
What are the main principles of psychology in marketing?
Psychology in marketing uses research on how people notice, judge and choose to shape how products are presented, priced and sold. Its best-supported principles include social proof, reciprocity, scarcity, anchoring, framing, loss aversion, the middle option, defaults, familiarity and fluency.
Is using psychology in marketing manipulative?
It depends on whether the signal is true. Psychology in marketing used honestly shows real popularity, real limits and defaults that suit most customers. Invented scarcity or invented popularity misleads buyers and spends the trust the principles depend on.
Which principle should a small business start with?
For a small business, psychology in marketing usually starts with social proof and defaults. Show genuine best sellers and preselect the option most customers already choose. Both need only accurate information about what customers do.
How can a business test these principles on its own sales?
Change one thing at a time, such as the order of options or the wording of a label, and compare sales or sign-ups against an unchanged version over the same period. A principle that works in a study still has to work for a particular set of customers.
Sources
Cialdini, R. B. Influence. Seed book; vault hub Books/Influence.
Cai, H., Chen, Y., & Fang, H. (2009). “Observational learning: Evidence from a randomized natural field experiment.” American Economic Review, 99(3), 864-882. doi:10.1257/aer.99.3.864 https://doi.org/10.1257/aer.99.3.864
Strohmetz, D. B., Rind, B., Fisher, R., & Lynn, M. (2002). “Sweetening the till: The use of candy to increase restaurant tipping.” Journal of Applied Social Psychology, 32(2), 300-309. doi:10.1111/j.1559-1816.2002.tb00216.x https://doi.org/10.1111/j.1559-1816.2002.tb00216.x
Worchel, S., Lee, J. W., & Adewole, A. (1975). “Effects of supply and demand on ratings of object value.” Journal of Personality and Social Psychology, 32(5), 906-914. doi:10.1037/0022-3514.32.5.906 https://doi.org/10.1037/0022-3514.32.5.906
Mussweiler, T., Strack, F., & Pfeiffer, T. (2000). “Overcoming the inevitable anchoring effect: Considering the opposite compensates for selective accessibility.” Personality and Social Psychology Bulletin, 26(9), 1142-1150. doi:10.1177/01461672002611010 https://doi.org/10.1177/01461672002611010
Levin, I. P., & Gaeth, G. J. (1988). “How consumers are affected by the framing of attribute information before and after consuming the product.” Journal of Consumer Research, 15(3), 374-378. doi:10.1086/209174 https://doi.org/10.1086/209174
Homonoff, T. A. (2018). “Can small incentives have large effects? The impact of taxes versus bonuses on disposable bag use.” American Economic Journal: Economic Policy, 10(4), 177-210. doi:10.1257/pol.20150261 https://doi.org/10.1257/pol.20150261
Simonson, I. (1989). “Choice based on reasons: The case of attraction and compromise effects.” Journal of Consumer Research, 16(2), 158-174. doi:10.1086/209205 https://doi.org/10.1086/209205
Madrian, B. C., & Shea, D. F. (2001). “The power of suggestion: Inertia in 401(k) participation and savings behavior.” Quarterly Journal of Economics, 116(4), 1149-1187. doi:10.1162/003355301753265543 https://doi.org/10.1162/003355301753265543
Moreland, R. L., & Beach, S. R. (1992). “Exposure effects in the classroom: The development of affinity among students.” Journal of Experimental Social Psychology, 28(3), 255-276. doi:10.1016/0022-1031(92)90055-O https://doi.org/10.1016/0022-1031(92)90055-O
Reber, R., & Schwarz, N. (1999). “Effects of perceptual fluency on judgments of truth.” Consciousness and Cognition, 8(3), 338-342. doi:10.1006/ccog.1999.0386 https://doi.org/10.1006/ccog.1999.0386