The Digital Marketing Podcast

Episode: 9 Digital Marketing Psychology Tips & Techniques

Hosts: Daniel Rowles & Ciaran Rogers

Date: July 16, 2017

Episode Overview

In this episode, Daniel Rowles and Ciaran Rogers delve into the world of digital psychology, specifically exploring cognitive biases (or “rules of thumb”) and how they impact consumer behavior online. The hosts break down nine key psychological principles and techniques utilized in digital marketing, provide vivid real-world examples, discuss the ethical considerations of leveraging these biases, and engage in a lively, candid back-and-forth that keeps the conversation fun and approachable.

Key Discussion Points & Insights

1. What is Digital Psychology? (00:34)

• Definition & Scope:
  Daniel describes digital psychology as the intersection of neuroscience, behavioral economics, and social psychology applied to digital environments.
• Purpose:
  Analytics shows what users do, but digital psychology explores why they do it.
• Cognitive Biases Explained:
  While Daniel uses the technical term "cognitive biases," Ciaran suggests calling them "rules of thumb" for simplicity and approachability.

2. Scarcity (03:24)

• Explanation:
  Marketers use phrases like “only 2 seats left at this price” to trigger urgency.
• Real-World Example:
  Airlines and hotels use yield management and scarcity messaging to prompt fast decisions.
• Ethical Watch:
  Overuse can breed skepticism and reduce effectiveness.

“Scarcity is there to encourage us to make this decision.” (Daniel, 03:24)

3. Anchoring (04:00)

• Explanation:
  Setting a reference point (e.g., “was £10, now £5”) makes the discount seem more valuable, regardless of the original item's worth.
• Example:
  Supermarkets using high “was” prices or “limit ten per customer” to suggest higher demand.
• Warning:
  Overuse (e.g., constant sales) diminishes trust and believability.

“If you do abuse these things, you break them from working in the first place.” (Daniel, 05:34)

4. Social Proof (06:00)

• Explanation:
  People are influenced by others’ actions or endorsements (“Someone you know liked this”).
• Examples:
  • Facebook pages showing friends' likes.
  • TripAdvisor surfacing reviews by your friends or friends-of-friends.
• Privacy Consideration:
  The line can blur when associating people with views they may not publicly support.

“You are potentially being associated with their opinions. They might be a raving lunatic.” (Daniel, 07:45)

5. Completion (Gamification) (08:52)

• Explanation:
  The drive to finish what has started — think LinkedIn profile completion bars and loyalty cards.
• Research:
  Pre-stamping loyalty cards increases completion rates; the closer someone feels to goal, the likelier the finish.

“We like to complete things once we’ve started.” (Daniel, 09:51)

6. Consistency & Commitment (10:18)

• Explanation:
  Once people begin a process (e.g., clicking “I’m ready to download”), they’re more likely to follow through (e.g., filling out a form).
• Example:
  HubSpot guiding users through small commitment steps for gated content.
• Supermarket Trick:
  Bakeries at the entrance entice indulgence, leading to more overall spending.

“Once you start doing something, you’re more likely to commit.” (Daniel, 12:07)

7. Loss Aversion (12:57)

• Explanation:
  People fear losing what they have more than they value gaining something new.
• Example:
  Mobile carriers giving rewards (like free music streaming after 3 months) to discourage switching.
• Realization:
  The desire not to lose small perks can drive irrational loyalty.

“We don’t like losing things once we’ve got them.” (Daniel, 12:57)

8. Confirmation Bias (14:42)

• Explanation:
  We seek out and prefer information that fits our existing beliefs.
• Implications:
  Social media “bubbles” amplify this effect; algorithms feed us content we agree with.
• Tactic:
  Marketers can begin messaging by mirroring a prospect's preconceptions to engage them further.

“You’ll spend 36% more time reading an essay if it agrees with your opinions.” (Daniel, 15:17)

9. Frequency Illusion (Baader-Meinhof Effect) (16:56)

• Explanation:
  Once you notice something (e.g., a type of car), you start seeing it everywhere.
• Marketing Impact:
  Display ads and brand mentions prime you to notice brands more, even if they're shown at the same rate.

“If you can hit... the sweet spot, this kind of frequency illusion... the future advertising... will get more visibility.” (Daniel, 17:59)

10. Decoy Effect (18:22)

• Explanation:
  Irrelevant options shape perceived value. A mid-priced product looks better when a high-priced decoy is added.
• Common Use:
  Tech and food pricing structures (e.g., popcorn sizes at cinemas, phone memory tiers).
• Interaction with Anchoring:
  Decoy options often work hand-in-hand with anchoring.

“One of the other prices has anchored you and it’s kind of decoyed you to look at the other price.” (Daniel, 19:30)

11. Priming (21:00)

• Explanation:
  Exposure to specific stimuli subconsciously influences later behaviors and decisions.
• Research:
  People exposed to “individuality” cues resist group conformity more in tasks.
• Marketing Application:
  Ads can “prime” importance of a feature before consumers reach a landing page.

“If you can start to suggest something... and then when someone arrives at your website, you don't need to sell it... you just demonstrate, we have got this particular thing. People are more likely to think that's important.” (Daniel, 22:40)

Memorable Quotes & Moments

• On Ethical Use:

  “There’s a very fine line between doing things for your customer and doing them to them.”
  (Ciaran, 23:37)

• On Overusing Techniques:

  “If you forever got a sale price on, then people know that the original price was never this original price.”
  (Daniel, 05:34)

• On Social Proof:

  “Suddenly your mate Steve, who’s an accountant, very straight-laced, is associated with Mad Molly McNobble.”
  (Ciaran, 07:45)

• On Frequency Illusion:

  “If you can hit... the sweet spot, this kind of frequency illusion... the future advertising... will get more visibility.”
  (Daniel, 17:59)

Ethical Considerations & Takeaways

• Transparency Growth:
  Warnings against being manipulative — today's digital consumers value brand authenticity and honesty.
• Balance:
  Techniques can improve UX and conversions if used playfully and transparently; overuse or deception can degrade trust.
• Content Opportunity:
  Daniel suggests:

  “Expose some of these [manipulative] practices and point out that you don’t do it… In the transparent world, that could be tremendously powerful.”
  (25:32)

Timestamps for Quick Reference

• 00:34 — What is digital psychology?
• 03:24 — Scarcity bias/rule of thumb
• 04:00 — Anchoring explained
• 06:00 — Social proof and real-world examples
• 08:52 — Gamification: Completion bias
• 10:18 — Consistency/commitment
• 12:57 — Loss aversion with case studies
• 14:42 — Confirmation bias; the social media bubble
• 16:56 — Frequency illusion (Baader-Meinhof effect)
• 18:22 — Decoy effect and pricing structures
• 21:00 — Priming and its impact

Final Thoughts

Daniel and Ciaran provide a thoroughly engaging, insightful, and practical guide to psychology in digital marketing. They strike a balance between educating marketers and warning against manipulation, encouraging ethical, user-focused application of these “rules of thumb.” The episode is rich with examples, humor, and actionable takeaways—making it essential listening for anyone interested in digital persuasion and customer-centric marketing.

For further resources and links to studies mentioned:
Visit targetinternet.com/podcast (as referenced in episode).