Global: Consumer Psychology Is The Only Constant In A Changing Retail Market

‘What’s not going to change in the next 10 years?’ This question is actually the most important — because you can build an offline and online business strategy around the things that are stable in time.” according to Jeff Bezos (Amazon).

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.

“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.

In addition there are six more essential truths of consumer psychology: control (Bezos’ functional needs), emotion, trust, 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.

Online shopping has provided consumers more agency in the current context, but there are still psychological challenges to overcome. Retailers and brands have to capture people’s attention online, which is harder to do than when they are in the store already primed to shop. “You’re trying to attract people’s attention, when they’re home attending to something else,” she says.

And then retailers must persuade them to buy. With online shopping cart abandonment rates approaching 70%, e-commerce players aren’t doing such a good job of that.

In the current context, people have many reasons not to pull the trigger, even if retailers have got their attention.

Activating positive emotions

People want to maximize their good feelings and minimize bad ones. That is the emotional component of consumer psychology, but there are two dimensions that underlie all emotional experiences: valence, or the extent to which the emotions are positive or negative, and activation, or the amount of physical energy associated with the emotion.