Reilly Newman | Think back on the last purchase you made. There was most likely a reason you justified that purchase in that moment.
Whether it was a “splurge” purchase for something you have been wanting (like a new coat) or a necessary purchase for something you need (like gas or food), these types of decisions go deeper than you think. At first glance, it may seem that the decision to make a purchase is logical and completely rational. In most cases, this is hardly the truth as the brain knows very little as to what the heart desires.
Ogivly’s Rory Sutherland, an expert in behavioral economics and science, once said, “The human mind does not run on logic any more than a horse runs on petrol.”
We can assume we made a certain purchase because was necessary. Most people will find ways to justify why a “want” purchase becomes a “need” purchase. The point isn’t whether a purchase is really necessary or not, but the reason we deem it necessary at the time we make the purchase. We do this to ourselves with all kinds of purchases and so do your customers. Learning how the psychology of purchases works will empower your business to better communicate with your customers as well as make your marketing efforts more effective.
When it comes to the main driving force of most purchase decisions, we can boil it down to two fundamental factors: ignorance and laziness. This may sound over-simplified, but that’s the point — our brains don’t enjoy complex things. When options or a decision become too complex we zone out and even enter decision paralysis. We have all experienced this, so keeping things simple makes sense because that’s the brain’s default mode in processing information.
Ignorance and laziness lead to purchases because we buy for leveraging knowledge/expertise and the convenience of energy/time. Don’t believe me? Here are some examples:
- You buy flowers for your spouse on your way home from work because it is on the way (time) and you didn’t grow the flowers and pick them to make a bouquet (energy).
- You hire a photographer for an event because you are in the event and can’t be doing two things at once (time) and you are not skilled in photography (expertise).
- You buy a loaf of bread at the store because you may not know how to make bread (knowledge) and it is more convenient instead of you making the bread (energy/time).
- You hire a plumber to fix a leak because they can diagnose the problem and fix it (knowledge/expertise) and can fix it quicker and more efficiently (time).
- You buy an cellphone because it is comprised of software tools (convenience) and connects you to others (time/energy).
- You buy tickets to a concert to be leisurely entertained (energy/time) and experience the talent of an musician (expertise).
It is an interesting exercise to reduce a product or service to a basic decision point like this. Yes, there are plenty of subjective influences that are injected into these decisions — especially when it comes to the perceived value of each product or service. However, I do fully believe that the subjectivity we deploy is simply our internal narrative that is navigating this decision and justifying it so it is “rational.”
For example, someone may buy the newest iPhone for the basic function of convenience, but they are convincing themselves of the purchase by telling them things like “I need to have this for work because it will make me more productive” or “I need the newest model because it will look better in front of clients” – as you can imagine, this can carry on in our heads as we convince ourselves there is more to the purchase and that we are rational in our decisions. Just as real is the simplicity of ignorance or laziness to be driving the purchase decision, the subjectivity and sway our internal narrative has is just as real.
The ignorance and laziness of a fundamental decision may set us on what we are purchasing, but our subjectivity will manipulate us on who we purchase from.
For example, imagine how the basic decision is determined by either your lack of knowledge or your lack of time. Now your decision swells to determining who you are going to buy from. This becomes increasingly subjective as you consider ordering your phone from either Apple or Android. You may have a preference and one brand may “match” your identity more, but as you weigh your decision, you do use the ignorance and laziness as your sounding board. This is because certain brands can make you look and feel a certain way. This is why (for example) some hotels have valet parking and room service because they understand their patrons desire for a luxury experience (laziness) and the brand leans into that desire.
Your business is dependent on this process because your business is dependent on purchases and the decisions behind them. When you think of the fundamental benefits of your business, think about how it assists in relieving ignorance or laziness. After you have considered this, you will want to imagine ways your brand can then help sway your audience to choose your brand based on the value you deliver.
