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ADVERTISING MAKES YOU BUY THINGS YOU DO NOT NEED! IT MANIPULATES YOU!
GROUP PROJECT
Members:
CALL Guillaume, AUDOUSSET Geoffroy, BAYRAK Samet, VASKOVA Petra, PISTECKY Jan, KOPECKY Daniel, HEYDRICH Lukas, FISER Martin
Marketing Project – Group 7, Msc. CULS Prague, 2010
“God damn it, an entire generation pumping gas, waiting tables; slaves with white collars. Advertising has us chasing cars and clothes, working jobs we hate so
we can buy sh** we don't need.”
Tyler Durden, FIGHT CLUB Movie
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Marketing Project – Group 7, Msc. CULS Prague, 2010
TABLE OF CONTENT:
Table of Content: ..................................................................................................................................... 3
Introduction ............................................................................................................................................. 4
Psychological perspective and consumer behaviour .............................................................................. 6
Motivation ........................................................................................................................................... 6
Perception ........................................................................................................................................... 7
The buying situation ............................................................................................................................ 8
Examples of techniques and psychological effects ................................................................................. 9
Salesman’s Techniques ........................................................................................................................ 9
Limited time offer ............................................................................................................................ 9
Buy one get one free ....................................................................................................................... 9
Loyalty cards .................................................................................................................................. 10
Guerrilla Marketing ........................................................................................................................... 11
Psychological pricing ......................................................................................................................... 13
Odd pricing .................................................................................................................................... 14
Question is, how are we influenced? ............................................................................................ 15
Prestige pricing .............................................................................................................................. 15
Dreams and Idols ............................................................................................................................... 16
The Bandwagon Effect ....................................................................................................................... 18
The Snob Effect .................................................................................................................................. 19
Code of advertising ............................................................................................................................ 19
Word of mouth marketing ................................................................................................................ 20
Summary ............................................................................................................................................... 23
References ............................................................................................................................................. 24
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Marketing Project – Group 7, Msc. CULS Prague, 2010
INTRODUCTION
Aim of this paper is to discuss the question whether advertising manipulates us to buy things we don’t
actually need. In other words, we would like to debate the issue of the impact of marketing and
advertisement on our rational thinking and decision making process.
Based on various examples, we would like to show that the statement can be proven to be true. We
believe the statement can be denied only by either using different definition (understanding of
advertising) or by argument that advertising manipulates only several groups of people that are
vulnerable to be manipulated. Nevertheless, the previous statement only supports the validity of the
statement.
Man can argue that the behaviour of the people depends on the individual personality, economic
condition and the way a company advertises their product and the discount offers given to the product.
Our point is, that there are various advertising techniques with various targets. Another big question is
how can we judge what kind of goods and services are necessary, and which good is bought only to
show-off among their friends and relatives? What is a need, and what is just a will?
This paper will argue the manipulation via marketing exists and the advertisement is making us to buy
things we do not actually need. We want to support the statement by using real examples, that are
divided based on the common psychological effect or methods used to manipulate people’s mind. We
would like to stress the importance of psychology which is seen as a main tool used by advertising
companies. Only via careful use of psychology are marketers able to create touching advertisements.
To create advertisements, that touches our minds, our senses and feelings that push us to buy things.
Our work takes into consideration both perspectives of the issue and support or disproves the
statement and ideas that are discussed below.
To discuss the main points, it is crucial to define and understand the meaning and the definitions of
used terms:
Manipulation
Mirriam-Webster encyclopaedia defines the term manipulation as following:
Manipulation
1. to deal with (something) usually skilfully or efficiently
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Marketing Project – Group 7, Msc. CULS Prague, 2010
2. to control or take advantage of by artful, unfair, or insidious means
We understand the definition and therefore the meaning of the word manipulation as follows:
Manipulation is a skilful process of taking advantage of something/someone by artful means. In other
words, manipulation should not be understood as only exploitation of someone by unfair practise.
Moreover, we would like to distinguish between a manipulation and the influence. Despite the fact
these two words can have similar meaning; we see manipulation as a more active and maybe even
successful way how to influence someone to act. To buy things, not only to consider buying.
Advertisement
We have seen various definitions of advertising. Namely some people are using Kotler’s and
Armstrong’s (Kotler, 2001) definition: "Advertising is any paid form of non-personal presentation and
promotion of ideas, goods and services through mass media such as newspapers, magazines,
television or radio by an identified sponsor". However, we do not take into account such definition,
because:
1. Not every advertisement is paid
2. Advertisement is nowadays personal thanks to various technology
3. Not every advertisement has identified sponsor at the beginning, see latter guerrilla marketing
Therefore we use more general definition by Mirriam-Webster encyclopaedia:
“to make something known to”
This definition serves us as a boundary for our argumentation.
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Marketing Project – Group 7, Msc. CULS Prague, 2010
PSYCHOLOGICAL PERSPECTIVE AND CONSUMER BEHAVIOUR
To define our perception of manipulation, we have to think what can explain consumer’s behavior and
how companies try to influence it.
Traditionally, there are four different theories around consumer behavior:(Consumer Behavior, 2010)
• Psychological models
• Sociological models
• Economic models
• Stimulus respond models
Therefore, we have to consider the psychological aspect to understand the problem. Indeed, to show
how consumers are manipulated by companies, we have to describe aspects that can influence
consumer’s mind.
Motivation First of all, each consumer has his own motives to buy. These motives arises from consumer’s needs
and wants which are based on factors such as wealthy, sex or religion of the person. According to this
fact, defining consumer’s needs is a huge stake for companies to elaborate a good advertising
campaign.
If we consider Maslow’s hierarchy as one of the basis of our work, as many authors do, we can
imagine how companies can manipulate us through advertising. Indeed, according to Maslow
(Maslow's hierarchy of needs, 2010) needs can be divided into essentials to survive and wishes that are
connected with our desire. When psychological and safety needs are satisfied, consumers seek for the
other wishes. As Maslow described, following need could not be satisfied if the previous is not
satisfied. As companies are aware of this effect, they try to exploit consumers perceptions and offer
them products and services according to their needs. Also, using special techniques can create
essential needs from basic want. These techniques are described below.
However, Maslow hierarchy could not be used for all consumers while each consumer thinks
differently and has own scheme of his needs and wants. Therefore, consumers are exposed to offers
that are more and more designed for individual wants. Moreover, not only individuals play important
role in various needs. Cultural and national changes across the whole world must be taken into the
account. What is considered as need in one country could not be reflected as need in another country.
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Marketing Project – Group 7, Msc. CULS Prague, 2010
In developed world, nobody can imagine the life without social networks, however, consumers in
developing countries do not have access to Internet at all.
That is why we believe that the crucial point when talking about manipulation is not really tailoring an
advertisement campaign to people’s need but creating the need itself. As an example could be used
Facebook. Many years ago, nobody needed social networks, however the situation has changed in past
years and people desire to use them every day. Thus, changes from wants to needs are driven by
companies. They use special techniques to manipulate with consumers minds and change the way of
thinking.
Perception The fact how an individual perceives an external stimuli and the influence of such stimuli on his
reaction is the common tool used in advertisement. Many authors and marketers proved that there are
different reactions for the same stimuli, which can be changed according to time, situation or context.
Traditionally, there are three main types of reactions:
• Selective attention: consumer screens out the majority of stimulants.
• Selective distortion: consumer adjusts his/her perception to his/her current mind set.
• Selective retention: consumer does not remember everything. He remembers information which reinforces attitudes and beliefs.
Through our various examples, we can see the background of company’s way of thinking and how
they exploit particular kind of advertisement in particular moment, in a specific place and by particular
person. These techniques can be seen as typical manipulation because marketers know their product
and its features and benefits, each product or service is intended for particular segment or target group.
Moreover, the product is designed to satisfy particular needs. There is an obvious objective behind
these activities - to sell as much volume as possible.
To discuss the objection, we can divide consumers on easily influenced consumers and rational
thinking consumers who will prove all received message. We have to state that advertising techniques
target on both groups. It means that all consumers are exposed to advertisements that can evoke
consumer’s stimuli to buy goods they do not need.
Also, these reactions can be used as arguments to prove the statement that people have natural
defences against manipulation; for example, many buyers have beliefs which protect them from a
majority of stimuli. Thanks to different studies, companies can predict purchasers’ reaction and
manipulate with their decision making.
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Marketing Project – Group 7, Msc. CULS Prague, 2010
Nowadays, a referred stimulus is used by blog creators for attracting new readers to monetize the
discussion. Blogs and discussion are no more used only for sharing ideas but they become more and
more useful for making money via various methods of monetising and advertising. Used tools are for
example Google adwords, affiliate links or direct payments. Blog authors use psychological
techniques to attract people to their blogs. They manipulate people by using their curiosity and
sometimes angriness among brand fans and so-called haters to push them to spread the words about
blog and posts on the blogs and moreover to add the comment below the posts. All the comments
attract traffic which is needed to monetize the blog.
The buying situation When people purchase stuff, they go through different stages(Consumer Behavior, 2010):
• Problem recognition
• Information search
• Emergence and evaluation of alternatives
• Purchase decision
• Purchase
• Post purchase evaluation
At each stage, they have different motivation and reaction which can be different according to the kind
of buying it is habitual, limited decision making, extensive decision making or impulse. All these stage
are opportunities for companies to convince, to influence and manipulate the customers.
For instance, manipulation is when advertisement changes a buying from a habitual one to an impulse
one. Indeed, in such kind of buying, each stage which is a time of reflection is shorted to push the
consumer to purchase.
The classical example of impulse buying is Apple iOS App Store, where majority of applications are
often priced below 3 USD, usually 0,99. This aggressive pricing makes us to do spontaneous buy so
we do not care about the small amount of money spent. Man can argue 0.99 is not a big deal, however,
the whole App Store is a huge multi-billion dollar business.
To continue, we are going to present many techniques used by companies to show How companies
and firms deal with all these psychological aspect to manipulate the client?
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Marketing Project – Group 7, Msc. CULS Prague, 2010
EXAMPLES OF TECHNIQUES AND PSYCHOLOGICAL EFFECTS
Let’s start with the statement:
“During a recession, sellers will be working extra hard and even more strategically to get your money.
Large corporations have entire departments that research and apply tactics concerning the psychology
of buying and selling.” (Hubpages,2010)
The statement is going to be supported in this section. The section contains Salesman´s Techniques,
Guerrilla Marketing and Psychological pricing.
Salesman’s Techniques
Limited time offer
It is the persuasive technique in advertisement that accelerate the customers purchase of particular
product due to limited time for purchase. The task is to frighten people, if the product is not bought
before the end of the limited time offer, there is no other opportunity to purchase the product for lower
price. However it’s not common that the product in the camping is the cheapest on the market.
To be more specific and give some example of buying certain product according to special offer, even
that it is not needed: there are many people who study newsletters - instead of newspapers - to find any
special offer and consequently buy more than they really need. Usually it’s under pretence that now it
is cheap and they are worry about future prices. This is also about „best before“food, which
unfortunately in many cases evokes ineffectiveness in consumption.
Buy one get one free
“As with so many retailing innovations, the buy-one-get-one-free offer was imported from the USA
during the economic downturn of the 1970s when food inflation was running at more than twice the
current level.” (Daily telegraph, 2010)
The offer that is called BOGOF can be time limited or permanent. BOGOF creates the opportunity to
sell something despite there is no need for it. For retailers and producers it’s amazing occasion to
spread products across the market widely. When the market is saturated it creates disadvantage for
competitors. It also cause ineffectiveness in consumption and increase revenues for sellers.
The psychology influence is used in this sales promotion technique as well - for many consumers it is
interesting and catchy if there is something free, they have feeling that this occasion will never happen
again.
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Loyalty cards
Loyalty cards are widespread feather of supermarkets and retailers. It is an key approach in marketing
techniques which allows to collect important data about consumers and consequently find the best way
how to create most attractive and catchy product offer. On the other hand it can be consider as a part of
positive relationship with customer. There are numbers of similar shops offering identical portfolios of
products. However, for consumers it makes difference to get something extra (collect points, receive
extra vouchers for birthday etc.) or just buy a product. Most of the consumers will prefer supermarket
where its possible to get something free and be part of the community.
On the other hand retailers might sustain regular consumers that stabilize the sales. As a side feather
retailers receive sensitive data about their consumers that helps to plan future development and
expansion.
According to ACCA Selling technique statement “As part of your marketing strategy, you have to
decide who your target customers are, and how you will approach them.” (ACCA, 2008)
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Marketing Project – Group 7, Msc. CULS Prague, 2010
Guerrilla Marketing When talking about forms of advertising and its marketing tools, to be wholly consistent it’s
impossible to omit Guerrilla Marketing.
The term Guerrilla Marketing was first officially used in 1984 by Jay Conrad Levinson. In his book he
was describing unconventional and aggressive product propagation with very low costs. He describes
Guerrilla Marketing as a tool of achieving conventional goals, such as profits and joy, with
unconventional methods – investing energy instead of money (LEVINSON, 1984).
Guerrilla Marketing is about attracting our attention differently than in traditional way. It derives
benefits from the moment of surprise and our astonishment. Strangeness and innovation are also its
key factors. Guerrilla marketing also allows getting side attention, causing panic and rousing the
public.
The reality, that it catches us off guard and causes an emotional response is its big advantage, because
emotions (laughter, shock, sadness…) are always great sellers.
The fact, that the advertisement is “hidden” or “invisible” is substantial. For Marketers is very
beneficial and important, that their potential customer don’t know, they are using guerrilla marketing.
If customer knows their secrets, he may just stop responding, which makes space for question if we
really aren’t manipulated by advertisement? Who would voluntarily let someone to control him?
It seems that marketers are very clever and well versed in principles of human psychology, so that they
can make us want to buy their products.
On the other hand we could say that today´s severe and unconventional ad campaigns are the only way
how to attract our attention in presence “over advertised” world of marketing.
Other relevant topic is connection of law and guerrilla marketing. Someone could say that we are
certainly manipulated by advertisement; otherwise we do not need to regulate it. However law
regulates marketing campaigns from more reasons. There are for example problems with illegal
putting up of posters, so it´s no always only about ethics and protection public against the high level of
advertisement influence.
The second part of this chapter will introduce various types of guerrilla advertising with some
explaining examples of its diverse forms. The division is different according to source.
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Marketing Project – Group 7, Msc. CULS Prague, 2010
Viral marketing is a highly visible form of guerrilla marketing these days. It is basically any
marketing technique that includes Web sites or users to pass on a marketing message to other sites or
users. It uses existing communication networks, not very reliable sources and has the potential to be
unstoppable, that’s why a viral campaign can’t be planned or predicted. It utilizes the advantage, that
people like to share interesting and entertaining objects and they do so willingly with no persuasion.
Ambient marketing allows a business to create brand recognition without necessarily pushing their
products. The advertisement usually somehow coincide with its surrounding, so that for first sight the
campaign may not appear as a product promotion.
For example a campaign of an Italian advertising agency (Admcom) for the promotion of the “Casino
Di Venezia“. The marketers have changed a traditional luggage claim belt to a giant roulette wheel at
Venice Marco Polo Airport.
Source: http://weburbanist.com
Presence marketing has same base basic principles as ambient marketing. It’s about making the
business name recognizable, familiar and always there – to target audience on daily basis. This can be
achieved through product placements in movies and TV shows, stalls at local festivals and markets,
regular Twitter updates, or whatever else which makes product name visible in everyday life.
Grassroots marketing is other form of guerilla marketing campaign. This advertisement can take on
many forms, some grassroots campaigns have elements of presence marketing or viral marketing.
However grassroots marketing is mainly about winning customers one-by-one rather than on a very
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large number. It is all about building relationship and emphasizing the personal connection with
customers, which can stand against the opinion, that advertisement manipulates us to buy what we
don’t want to.
Even it may seem old-fashioned, Wild postings are still wildly popular and are part of guerilla
marketing. Wild posting is favorite mainly with indie bands and indie image. Its aim is to attract
maximum attention of course, but a great portion of their effectiveness lies also in the secret that they
can make us believe we’re witnessing and part of something eventful. Most of us would love to have a
poster from the wild posting days of the Beatles, right?
Undercover marketing, also known as buzz marketing, is about selling something to someone who
has no idea, that they’ve just witnessed a sales process. Very important part of undercover marketing
is Word of Mouth.
Quite unethical part of guerrilla marketing is Astroturfing. It is about creating an artificial buzz about
a product or company on online forums, blogs and others… However all those references aren’t made
by the public, but by shills, or people associated with the company, who are paid to express a positive
opinion.
Publicity that looks like it is completely removed from the company itself is characteristic of
Alternative marketing. For example (even it has been suggested more than once that the whole event
was a controlled publicity stunt) when Paris Hilton’s Sidekick was hacked, sales of Sidekicks jumped
overnight, while T-Mobile probably (maybe?) had nothing to do with that publicity, it was excellent
marketing for them.
Experiential marketing connects people to the product by experience. Owing to today´s abundance
ad campaigns, it is very easy for us to ignore product promotion and tune it out. But interaction and
experience associates immediate emotional responses, either with the product or with its brand. On
Internet can be experiential marketing seen in form of for example offering trial version for free.
Experience helps to make an intelligent and informed purchasing decisions, which is far away from
manipulation.
Tissue-pack advertising is also a part of guerilla marketing. However this way is so known that we
could consider it as traditional marketing technique.
Psychological pricing The price is very important and crucial element of the marketing mix. Pricing is a part of business
strategy and can be based on different factors, for example profitability or market penetration,
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Image source: Pricing psychology report ‐ Marlene Jensen
Marketing Project – Group 7, Msc. CULS Prague, 2010
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however price influences the character of promotion and can be a very efficient advertise. That’s why
it is efficient to ground it on psychological aspects.
Firms must offer their products for a price their target market is willing to pay. There is still a question
how do customers perceive the value of the product? Companies have to find a price that enables them
to make a fair profit and seems fair to their customers.
Odd pricing
Consumers respond to numbers and psychological pricing tactics, this method is used to give an
illusion of value: to pay less.
For example, what is the difference between a price ended in the number 9 and another ended in the
number 0? The first one represents approximately 60% of the product prices and the other one
represents only 7%. This idea was firstly used by Czech entrepreneur Tomáš Baťa at the beginning of
the 20th Century. Now we are accustomed to see this kind of pricing but the impact is still very strong.
Moreover, a survey shows that the 9.99 price will probably pull 10-20% more buyers than the 10
price. This experience was tested on American customers in 90’s and it reveals the strength of the
technique.
Marketing Project – Group 7, Msc. CULS Prague, 2010
Question is, how are we influenced?
Certainly not because of the single penny saved. According to researchers have demonstrated “that
people are more likely to buy odd-priced items because the mere image of odd prices makes products
seem less expensive (Schindelr, 1991).
Of course that is not true with all products but sometimes there is a correlation. Furthermore, a survey
from the French University La Sorbonne reveals that children are more receptive to this odd pricing
and can easily be manipulated.
Prestige pricing
This technique is very often used in the luxury industry. It adjusts high price for a product or service in
order to create an image of high quality. Prestige pricing is useful for consumers who believe price and
quality are related.
Why do we prefer the more expensive product? Is it really better? Is really there a difference between
pasta, jeans or alcohol? Sometimes it’s true but generally not and firms use this idea to manipulate us. Do we perceive a product from luxury industry as a bad product? No. Why? It’s not a secret that we
pay the brand and not the quality.
To conclude, psychological pricing is very often used to manipulate us and we can’t ignore it. Of
course, everybody is not influenced by this technique but its efficiency is proved and that’s why firms
use it.
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Dreams and Idols Companies are using our dreams and wishes to manipulate us to buy goods and services. For instance,
they are creating (and furthermore using) our idols to help them to sell things. Man can even say we
are not buying the actual products; we are buying the feeling to be members of some social or cultural
group by using advertised goods. So we are spending money for something that we already have, i.e.
our dreams, ideas and feelings.
Source: http://img641.imageshack.us/img641/3286/gillettethierryhenrytig.jpg
From the psychology perspective, people want to be a members of any society or cultural groups. This
sense have been inherited from the past. Advertising companies are using that so in the advertising,
they are picturing groups of either rich, famous, beautiful or talented people to enhance our need for
social belongings. These are words of a marketer:
“How do famous people play an important part in advertising? This is called endorsements. A
company banks on the idea that a person's celebrity will drive fans to try a product or service, simply
because Celebrity X has. I don't like this approach - although it's widely accepted - simply because the
corporation seems to imply that we are shallow enough to do something only because someone else
has.” (Sheikh, 2010)
Marketers have been using celebrities in commercials, print campaigns and promotions for years,
because it just works. Celebrities get the viewer’s attention; but whether they work to sell the product
depends on proper celebrity casting. The billions of dollars spent per year on celebrity endorsement
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Marketing Project – Group 7, Msc. CULS Prague, 2010
contracts show that celebrities, like Cristiano Ronaldo, Megan Fox, Troy Polamalu and Tiger Woods,
play an important role for the advertising industry. Female athlete Venus Williams, tennis player and
Wimbledon championship winner in 2002, for example, has signed a five-year $40 million contract
with sportswear manufacturer Reebok International Inc. . Theory and practice prove that the use of
super stars in advertising generates a lot of publicity and attention from the public. The underlying
question is, if and how the lively interest of the public in ‘the rich and famous’ can be effectively used
by companies to promote their brands and consequently increase revenues.
History has proven people can be manipulated, either by advertising or propaganda. For example, the
Nazi propaganda during WWII, Communist revolution, etc. Manipulation is done by using our
emotions and dreams (i.e. having a good life, future, belonging to social group, Nationalism, supreme
race, sharing culture, equal life, etc.).
Source: http://chelseamia.corriere.it/Blog_Hitler_Speech.jpg
However, human beings are not completely stupid and thanks to gained experience we can somehow
resist the temptation. Man can say “They use our dreams as tools to sell their products; they try to
manipulate us by our idols.” Contrary, we are human beings; the most important difference between us
and animals is that we are wise beings. We have our brains to use it, to think. Maybe some of us can
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be fools to buy these lies, but in general we don’t be cheated anymore. But we have to remember that
the worst habit of human kind is repeating mistakes.
The Bandwagon Effect The origin of the word “bandwagon” comes from the band-wagon, which means the wagon which
caries the band (or other entertainer) on a parade or circus. The reason why this is used in the purpose
of marketing (also economics and psychology) comes from late 19th Century when a famous US
clown used his bandwagon with music to gain attention for one of the candidate’s political campaign.
It was followed by many other politicians who used this method in their campaigns.
This psychological phenomenon which is also called “cromo effect” or “social proof” means that the
customer is willing to purchase one product which is purchased by others. The reason can be various,
this product can be modern and the customer wants this product just to “be in”, example can be
products like cell phone with 5 Mpix camera, or e.g. specific brand which holds with particular sport
(Uncle Sam in fitness centre, Wilson on tennis court etc.). Or this product is a very useful one and this
customer wants it for example to be connected with others, like Skype, TV, laptop etc. Another
psychological reason can be that the customer thinks that the others are better informed about the
market and the product, so he just follows the main stream. So, when the customer thinks more
customers are purchasing, the more he is willing to buy it.
Marketing campaigns especially in cell phones are very well developed, e.g. Samsung places new
phone on market almost each month and promotes it in a modern and sometimes futuristic way, so it
forces you change your “old” phone for a new one. The technologies in cell phones also change
rapidly than in computers so the customers just want to be in. I personally change cell phone each 6
month to have the up-to date technology in my pocket, just in order to not be out.
Another market segment which can be well manipulated by this effect is children market. Especially
children want to belong to the group of others and when the child sees particular product e.g. LEGO or
iPhone games in other child’s hand, it automatically want the product too and force the parents to buy
it. Good example of this can be free samples of toys or ice cream in the kindergarten, or TV
advertisements on toys and games before the Christmas.
We can say, that the bandwagon effect, when used wisely, can be very powerful tool to manipulate
people to buy a product. But, on another hand, what works perfectly on children does not need to work
on other people.
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The Snob Effect This event is caused by the desire to own a unique product, which nobody, or very few people have. A
good example can be piece of art (e.g. paintings and sculptures from famous artists), luxurious clothes
(e.g. brands like Gucci, Prada, Dior, Armani and Versace), expensive cars (e.g. Porsche, Aston Martin,
Jaguar and Rolls Royce), the newest technology (early adopters of 3D TVs, cell phone in watches
etc.). The less of the goods is available on a market, the higher the snob value is. When this customer
thinks more people have the particular good his need to have these goods decrees, so the snob value of
the good is then lower. This often leads to shifts in the price of the good. First, the price for some
special snobbish good is very high, so, snobs will buy the good. But then more and more snobbish
customers own this good, thus it is not as unique as it used to be, hence the price for them is lower and
the good go to discount. The snob value depends on these customers and it differs from person to
person, so it is hard and sometimes even impossible to predict their behaviour. People who suffer this
effect are not always so called snobs, but also collectors, like philatelist, for instance.
Luxurious automobile companies like Aston Martin and Rolls Royce design some cars only in a
limited number. The advertisement is tailored on wealthy people and the information that the
particular car is ruinously expensive and made only in 20 pieces is very important for them and create
the desire to own such car.
Company which is focusing on the high end of the market surely know the principles of the snob
effect and treats the customers and advertisement in such way, but there are other principles which
should be taken into an account. Another barrier to this phenomenon is that wealthy people are not so
much predictable and possibly omit the advertisement itself.
Code of advertising If we want to support the statement of our thesis from legal perspective, we have to take into the
consideration Code of Advertising and its effects.
Code of Advertising serves as a regulation factor. Moreover, it protects consumers against deceptive
advertising of advertising agencies. Even that each country has its own regulations design for their
competitive environment, there are some general conditions that must meet the requirements.
Responsible advertising practice should include: accuracy and clarity, disguised advertising
techniques, price claims, safety, unacceptable depictions and portrayals, and advertising to children. In
general, there is code that regulates conditions of using advertisement and direct which practice are
allowed and which are forbidden. If we admit that the code is developed to protect consumers rights,
we have to also admit that the advertising can influence consumers and manipulate with their decision
making. It means that advertising can have positive or negative effect on consumers perception.
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Nevertheless, if forbidden practise are not applied, the impact of advertising is not maximise,
therefore, allowed advertising practice cannot be harmful for consumers.
Word of mouth marketing
Word of mouth marketing is specific type of promotion. The aim of this technique is to create
such attractive and appealing story that will be spread through people. Furthermore, word of
mouth effect serves to create positive awareness of some product through spontaneous way. There could be discussion if word of mouth is or is not advertising. (Kotler,2006) and other
authors describe advertising as paid and non-personal promotion. On the other hand, word
of mouth is defined as unpaid and personal form of promotion. There is a clash in two
aspects – paid/unpaid form and personal/non-personal. We agree that word of mouth is a
personal but the unpaid form is issue to discuss. It is important to stress that word of mouth
can be either paid or free. Nowadays, there are many paid influencers who communicate the
best features through the crowd and use superlative recommendations regarding to
particular product or service. As companies exploit special teams to spread positive
messages, word of mouth advertising is no more only unpaid form. Statement that word of
mouth is a part of advertising can support many word wide marketing agencies such as
Nielsen that classify word of mouth in their advertising research and reports together with
other forms of advertisement. In their research, word of mouth advertising is ranked as the
most reliable source and three-quarters of consumers consider consumers experience and
recommendation as most effective form of advertising. It is obvious that personal opinion has
high credibility. Word of mouth marketing relies on its reliability and it can influence and
manipulate potential consumers. Without doubt, it has more presumptions to successful
influence than other types of advertising.
Speaking about paid and unpaid form, we have to take in account that companies develop
special strategies to spread positive messages. There are some techniques used to evoke
word of mouth effect: provide consumers sample to try, provide them space to express
consumers opinion and feedback, distribute special coupons providing an advantage,
provide extraordinary service or develop website to share ideas and recommendations. All
these actions create positive awareness of the product or service and consumers start to
share their experience. Further, their recommendations influence decision making of
potential consumers.
We can have a look on word of mouth marketing from other perspectives. If two or more
friends are discussing about product, it is not paid. However the discussion has not started
spontaneously. There must be story behind. At first, people are exposed to paid
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advertisements and later they started to talk about it. It means, that intermediator is
influenced by commercial or other type of advertisement and later he starts speak about it.
Advertising is not the only tool which affects consumers’ perceptions. It is a part of eight
models marketing communication mix. Besides advertising, communication mix covers sales
promotion, events and experiences, public relations, direct marketing, interactive marketing,
personal selling and word of mouth marketing. All these communications mix tools are
interconnected and they have the power to influence consumers’ way of thinking and change
decision making.
We can consider that people are rational and they will verify all messages they receive and
recognize. But is this statement really applied in real world? The answer is certainly no.
Companies are aware of consumers’ lack of knowledge and they want to exploit it. For those
reasons, advertising attacks on consumers’ perception and try to manipulate with
consumers. If we get back to the presumption that people are rational, they are exposed to
thousands of messages and it is hardly recognize what message needs to be verified and
what message is really truthful, especially in terms of word of mouth effect. As it comes from
somebody consumers know and are familiar with or from somebody who is not employer or
other stakeholder of the company, consumers tend to trust the person. Somebody’s
recommendation tends to be as independent source of product’s features and qualities.
We would like to demonstrate the power of word of mouth effect on the example of Czech
Insurance Company called Direct Pojistovna. According to this example is seen word of
mouth can manipulate with people and their way of thinking. The insurance company focuses
their effort on motorcars insurance. One year ago, they come up with advertising campaign
that was highly supported by word of mouth effect. Before they start their official campaign,
they change public perception and awareness of stealing cars. The company uploaded on
youtube.com and other social networks a video where one guy stealing Skoda Fabia in very
easy way – using erotic tool and tooth breast. The video was uploaded anonymously and
nobody had the idea that the company stands behind it. This video has such a big success in
people’s discussion that it has been seen by more than 10% of Czech population (at current,
there are more 1 400 000 views on youtube.com). Side by side with this amateurishly
recorded video was campaign of Dircet Pojitovna to arrange the insurance and protect
consumers’ cars against thief. People were influenced by the video they saw before and start
looking for the solution. The solution was provided by Direct. As there was huge campaign
focused on car insurance, people spontaneously react on the commercials and advertising
and start signing contract with this particular company. Although there were other companies
advertise in media, Direct Company invest more money in the particular period and they
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advertisements had been seen most. The story of Direct Company shows how people can be
manipulated and influenced by word of mouth marketing that is supported by well-prepared
campaign.
Video related to this story is available at: URL:
http://www.youtube.com/watch?v=qMCNoMdF3Xw
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SUMMARY
Based on our examples we have proved the statement: Advertising manipulates us to buy things we
don’t actually need. Most of us are suggestible and psychology techniques in marketing are really
powerful tool to manipulate us, to change our needs. Based on the fact of growing knowledge of
psychology, some of the methods are so powerful that have to be regulated. Traditional ways of
advertising, such as psychological pricing, various sales techniques, and new methods of
advertisements, such as usage of social networks, guerrilla marketing and others are nowadays able to
adjust the advertisements to fit to expected needs and manipulate with specially targeted groups.
However, due to culture differences we are influenced unequally and that complicate the direct aim on
us. There are also other factors, for example different personal purchasing behaviour and different
perceiving external stimuli that does not straight the process. On the contrary they make the
advertisement techniques more inspiring and creative.
Companies are maximizing their profits and they will do the best to sell their products. More
investments will go to the development of new approaches in psychology as the most important tool to
increase sales. Nevertheless, a proper manipulation by advertisement and others will create needs that
could have the disposition of survival needs that are definitely included in our rational thinking.
Finally interaction between psychology and advertisement are apparent. However psychology without
advertisement is something obvious, advertisement without psychology is not possible.
Source: http://antiadvertisingagency.com/category/projects/bus-stop-ad-project/
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24
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