CONSUMER ECONOMICS and media literacy have evolved to become important fields of study, analyzing the way consumers make decisions—and how those decisions can be nudged. Here are 20 of the tricks and techniques used by marketers and others:
Aspirational buying. When consumers are encouraged to live like those they admire, even if they can’t afford it.
Bandwagon appeal. The psychological nudge to do—or consume—something because others are doing it. Also known as FOMO, or fear of missing out.
Bundling. The practice of offering multiple, usually related, goods and services at a lower price than if each item were purchased separately. This is great if you’ll use the entire bundle, but a waste of resources and money if you don’t.
Dog whistle. An indirect or implied message meant to communicate with a particular group, often placed within a broader, more general message, thus allowing the messenger to deny meaning it. It can also reinforce a “you’re an insider” sense of affiliation. Saying something is only for “the right people” can make us want to be one of those “right people.”
Eye candy. Visual images that are superficially attractive and entertaining but are unnecessary or unrelated to the subject at hand, such as flashing lights and attractive spokespeople.
False statistics. Using graphs, charts or statistics that sound precise—yet even the four out of five dentists who preferred Trident gum can find these numbers suspect.
Feedback loop. A phenomenon whereby the media, reporting a purported “hot” trend, inspires consumers to follow the trend. This seemingly confirms the initial report.
Flattery. A technique where the potential consumer is complimented as part of the sales pitch. “Because you’re worth it.” “Don’t you deserve the best?” Such phrases induce consumers to feel good about the product, making them more likely to buy.
Freemium. Giving away a base-level product for free, but then offering paid upgrades and enhancements once the buyer is hooked. A common practice in gaming.
Hasty generalization. A conclusion drawn from insufficient evidence, such as ascribing the characteristic of a few members of a group to all of the group’s members. It also includes proof by anecdotal evidence. “I once knew a guy from Florida who lost weight by eating only alligator meat, so it must work.”
Hedging. Subtly limiting or equivocating a claim, so as to reduce the guarantee or assertion made in the claim. “Studies indicate there may absolutely be a connection between hedging and people slipping on soap.”
Hyperbole. Exaggerated claims or statements used as a tool of promotion, but not as a statement of fact. It’s only false advertising if a “reasonable person” would believe facts are being stated.
Juxtaposition. Placing items, whether physical objects, pictures or statements, side by side to invite comparison. “I’m not saying it works. I’m just putting these pictures of before and after in front of you, and I’ll let you decide.”
Nostalgia. Invoking simpler, better times can make us want a particular product, even if we don’t remember what those times were really like.
Panache. Having a style or manner, usually indicating superior socio-economic status. Can be done by an affectation, such as giving American ice cream an exotic Dutch name, or spelling colour or theatre in the English way. Also called posing.
Poisoning the well. One side introduces negative facts or perceptions about the other side, putting the other side at an immediate disadvantage. “Only an idiot would buy….” It can include the ad hominem fallacy, where a messenger doesn’t address the substantive differences, but attacks a competitor’s or opponent’s motives or credentials.
Plain folks. Having people just like you speak on behalf of a product, except—unlike you—they’re getting paid.
Stacking. Skewing experiments, data or the presentation of data in a way that helps market a good or service. One allergy pill claimed it was the only one clinically proven effective. The fine print noted it was the only pill tested in the clinical trial.
Testimonial. Having a false expert—like a famous person or a guy who isn’t a doctor but plays one on TV—advocate for a product. A popular NFL quarterback was everywhere on Dallas TV as the “official spokesperson” for a brick company.
Truthiness. A term coined by Stephen Colbert, it’s when the appeal is made to our “gut,” no matter what the actual data says. “Everyone knows….” It’s based on confirmation bias, our tendency to accept or reject data based on whether it supports or refutes beliefs we already hold.
Jim Wasserman is a former business litigation attorney who taught economics and humanities for 20 years. Check out his follow-up article, Choice Words. Jim’s series of books on teaching behavioral economics and media literacy, Media, Marketing, and Me, is being published in 2019. Jim lives in Granada, Spain, with his wife and fellow HumbleDollar contributor, Jiab. Together, they write a blog on retirement, finance and living abroad at YourThirdLife.com.