Ever wondered why you choose one brand of beer over another in a pub when you don’t have a strong preference (when we could still go to pubs, that is!)? The answer could lie in a fascinating mix of psychology and marketing, known as behavioural economics.
Behavioural economics seeks to explain the irrational impulses which guide our decision making. Contrary to the teachings of the original economists who believed that all decisions were made rationally, based on a cold evaluation of price and product benefit, it examines all the small irrational cues which, often subliminally, guide our behavior. For example, a sign on a beer pump telling you that a beer is this month’s best-seller, or your town’s most popular choice makes you more likely to choose that brand – it certainly explains why British Airways used the tagline “Britain’s Favourite Airline” for so many years! Those signs in hotels which say that most guests choose not to have their towels replaced every day? They make you more likely to reuse yours.
Richard Shotton, a leading UK behavioural economist and author of The Choice Factory, has conducted some research for Thinkbox, the TV marketing body, on behavioural signaling. He looked at whether the media channels we choose to advertise on (specifically, the broader reaching, “public” channels i.e. those that are consumed by people en masse such as outdoor or TV) affect the perception of the brand and found that they did in two different ways.
- Cost signaling
This is the perception of the quality of the brand based on how much budget is put behind it. The research shows that people believe brands with big budgets have confidence in their product and faith that it delivers on its promises.
This is backed up by the work of Kirmani & Wright, who demonstrated that people who were shown an article about a new product launch with varying advertising budgets rated the product higher as the budgets they were shown increased. There is a watch-out, however, that if the spend looks hugely out of kilter with the market, it can negatively affect perception as it looks like a sign of desperation.
- Trust signaling
People have more trust in statements made in public. Shotton conducted some research where he told people that a politician had promised increased budget to be spent on traffic cameras. Some were told he had made this promise at a public meeting and some were told it was in a private conversation. More than twice as many people believed that he would keep his promise if made in public. The same can be said for brand statements that happen in those public media channels vs private ones.
What does this mean for our media channel selection?
We might not be able to afford to outspend big brands and afford all-singing, all-dancing TV campaigns but we can use those different channels in a tactical way. We can tap into the cost and trust signals by using cherry picked public channels but then surround our audience on private channels such as social, display or email. This not only reinforces the message, but by appearing everywhere gives the impression that we have much larger budgets than may actually be the case!
There are also ways to make use of platforms that confer cost signaling benefits without spending the earth. Consider inserts in national press or non-linear TV options: both sit with in a high-value setting which may seem “national” to the uninitiated but both are available on a geographically specific basis and with lower buy-in costs than many would expect.
Public channels are more likely to be believed and more likely to build trust in brand promises than private channels such as DM or email. This further enhances their effectiveness as awareness driving media formats, with the more direct channels working better at the bottom of the funnel once trust in the brand has already been established.
At Space & Time, we always consider the need for awareness driving activity as a first step in planning campaigns. Our in-depth local area media appraisals always include a review of broadcast opportunities in key areas, as well as a close look at email and postal databases for the more direct messaging. When planning digital, we prioritise prospecting activity to drive awareness and site traffic to enable us to serve more personalised retargeting messages as a follow up.
This research is just the tip of the behavioural economics iceberg. If you are interesting in learning more, The Choice Factory: 25 Behavioural Biases that Influence What We Buy by Richard Shotton is available on Amazon or get in touch with us at Space & Time to find out what other subconscious biases may affect our buying choices!
Joanne Lambert, Group Account Director