Leveraging consumer psychology with effective promotions

How promotions drive behavioral change in consumers

May 4, 2023
RSS Icon
Leveraging consumer psychology with effective promotions
Play video
Play icon
Leveraging consumer psychology with effective promotions

As a retailer, one of your primary goals is to create long-term, satisfied customers excited to shop at your stores. But achieving that loyalty means understanding consumer psychology — knowing what drives behavioral change in your direction.

Luckily, you don’t need a Ph.D. to decipher consumer psychology. Cash back promotions are proven to bring in new consumers and get occasional consumers to shop more. Let’s break down the basics of how consumers think, why cash back offers are so effective, and which platform you can use to optimize this strategy.

How promotions influence consumer behavior

Scientifically, consumers have a negative neurological response to contemplating the cost of their purchases. This "pain of losing money" dampens the excitement of acquiring a new product or solving a problem. Promotions can help turn this negative into a positive:

  • Promotions stimulate more purchasing. An Onbe report showed that 70% of consumers are likely to make an additional purchase when they have access to incentivizing promotions, indicating that the reward stimulus directly triggers more purchasing.
  • Promotions instill consumer loyalty. The same Onbe report revealed that 91% of respondents have higher satisfaction with brands offering promotional programs, while 71% cited incentives as a key factor in brand loyalty. Incentives encourage repeat business, converting occasional shoppers into regular customers.
  • Gradual promotion strategy changes sustain loyalty. Simon Kucher & Partners' research reveals that regularly updating promotions helps retain customers. For retailers aiming to boost customer loyalty, it's crucial to adapt promotional offers over time to keep them engaged. SK&P emphasizes that this gradual approach enables profitable value delivery for each transaction while maintaining customers' brand loyalty.

This process of recognizing value, providing tailored promotions, and strategically managing your approach lays the groundwork for building customer loyalty. By leveraging resources like transaction data (which you already have), you can precisely target promotions, ensuring you don't undermine or cannibalize sales that would have happened. Essentially, you'll intentionally shape consumer behavior.

Streamline the personalized experience with a single app

Considering the positive psychological influences that a well-devised promotion strategy can have on consumers, the only issue for retailers is finding a way to profitably manage, implement, and measure an effective strategy from a single source. That’s where Upside comes in.

With Upside, you can:

  • Access millions of users ready to make purchase decisions
  • Effectively incentivize customers to choose your establishment over competitors
  • Provide a unified, multi-category experience within one app
  • Encourage purchases across categories, boosting profits for participating retailers
  • Harness consumer psychology to drive growth and loyalty
Leveraging consumer psychology with effective promotions

The Upside Team

Linkedin - Upside

The Upside team is made up of data scientists and industry experts who are passionate about delivering empowering content to our readers. With a focus on providing practical insights and meaningful perspectives, we create engaging materials across a wide range of topics. From exploring industry trends and offering expert analysis to sharing useful tips and inspiring ideas, our team works diligently to provide you with the information you need to thrive.

Request a demo

Request a demo of our platform with no obligation. Our team of industry experts will reach out to learn more about your unique business needs.