How Targeted Marketing Can Influence Your Spending Habits
By now, I'm sure you've already figured out that social media profoundly impacts how you feel about yourself. But what about your wallet? Several research institutions are currently working to answer the question; how can targeted marketing influence your spending habits?
Are ballooning ads on social sites to blame? Or is it simply that we constantly submit to peer pressure so we can impress our peers with what we have? All in all, targeted marketing has greatly influenced our spending habits. Currently, the US eCommerce industry is well on its way to crossing the $1 Trillion mark.
More importantly, 98% of consumers plan to make their purchases through social media. Such data paints a picture that almost every average user who spends more than two hours on social media will likely witness a change in their spending habits. That demonstrates how the convenience of placing an order online has so much control over our daily lives.
But to give you a clearer picture of how targeted marketing can influence your spending habits, here are top examples of the same.
How Targeted Marketing Can Influence your Spending Habits
1. Targeted Ads and User Data Mining
Television, for example, is ideally free to consumers but has been paid for by commercials. For users, using television for entertainment is as common in any home as having a couch. And marketers gambled with this by playing ads repeatedly on TV to influence consumer spending. Eventually, it worked miracles and is now the cornerstone of any marketing technique.
The most recent version of it is with social media. The father of social media, Mark Zuckerberg, started Facebook as a free platform where users can connect with others worldwide. For years, Mark toiled, trying to make this platform profitable. And finally, he made a breakthrough through an element of commercial advertising that took this platform to the next level; mining user data.
When you create your account on Facebook, you agree to the Terms of Service that allows the app to save your data and track your online behavior directly. The same goes for everyone on Facebook and other Meta platforms, such as Instagram. And whenever you see a sponsored ad on your timeline, it's no coincidence. The info you unintentionally or intentionally provide Facebook's algorithm helps the Ai predict what you might be interested in and want to buy.
2. Online Shopping Convenience
According to recent research done by Visa, most online shopping is a result of interaction with social media outlets. Buyers now enjoy the convenience of shopping easily on social media sites. However, there are several concerns about user data and how these companies use them, most, if not all, users report that targeted marketing is profoundly convenient. That's because it shows them genuine items according to their searches instead of researching endlessly for things they might likely not find.
On top of that, Facebook's in-app shopping feature means that users don't have to leave the app when they want to make any purchases. By shortening the funnel distance, Facebook has ideally made it easy for users to spend their money without giving it a second thought.
3. FOMO (The Fear of Missing Out)
Hands down! Targeted ads and in-build shopping features do an excellent job. But they are not the only items pushing customers to spend their money. Another factor that hugely impacts consumer shopping behavior is the fear of missing out.
Most people are motivated and will keep pushing their limits to unlock social achievement by mimicking other successful influencers on social media platforms. What's more, we typically use our social media to demonstrate our worthiness to our followers, style, and affluence.
A huge number of millennials say that social media cause them to compare their material possessions and wealth to that of their peers. On top of that. Nearly 57% of millennials say they ended up spending money on something they didn't plan on just because they saw it on social media.
4. Force impulse spending
Aside from the above factors, target marketing also influences spending by triggering impulse buying. Social media is widely known for making you feel good or bad about yourself. But when it comes to spending, it doesn't matter the effect social media has on you. That's because both positive and negative emotions will likely push you to spend your money.
For instance, if social media makes you have negative feelings about yourself, you are likely to purchase an item that will make you feel better. Additionally, several users have claimed to spend money on things to get a feeling of belonging with their peers or even keep up with them. And when social media gives you a sense of appreciation, you will likely shop for items that will continue to boost that feeling.
Evidently, the influence of social media on your spending will end up being specific to you. However, if you have an issue with retail shopping, chances are social media will amplify that emotion. Anyone with a pre-existing impulsive control issue may find it harder to resist the temptation of shopping online.
5. Influencer Ads
We typically don't like the idea of someone selling an item to us. However, most social media users will feel excited when their favorite influencer buys an item or service they are also enthusiastic about. And to that effect, brands and other established companies leverage this by partnering with influencers who post items or services on their feed to entertain their followers.
In simple terms, users are more likely to trust a specific item that their favorite or trusted influencer reviews. Over 80% of users claimed that social media posts, reviews, and testimonials greatly influenced their purchase.
6. Promotions and Discounts
Most users on social media have signed up for groups and forums they are interested in or have shared ideas. In most cases, users will follow platforms that offer products and services to keep up with the latest on those pages. As such, when customers see discounts, promotions, and deals on their social media platforms, they immediately feel the need to take advantage of such deals.
Brands use these promotions and discounts to influence customer decisions, for instance, Black Friday Deals. That, without a doubt, spikes impulse buying from the users and will lead to unplanned purchases.
What's The Impact of Influencer Marketing on Consumer Behavior?
Nowadays, when it comes to marketing, the trust factor crops up all the time, and there's a good reason for that. Over time, people have realized that commercials tell many lies while celebrities are paid to endorse items they don't even care about. On the other hand, influencers build their brand around the things they care most about.
Besides being a trustworthy source of information, influencers are only likely to promote products they have evaluated; otherwise, they risk losing their audience. That's the main reason why people are more likely to trust an influencer rather than a commercial or a celebrity. And over the years, influencer marketing has become a significant thing.
You'd be surprised to learn that a good number of consumers depend on influencers' expertise when making their purchasing decision. Ultimately, influencer-generated marketing plays a vital role in molding the spending habits of consumers. That's because people find influencers more real, and trustworthy and have better content delivery. Also, influence built with influencer marketing focuses on the consumer's intention to make the purchasing decision immediately.
Frequently Asked Questions
Q: What are the main things that influence your money habits?
A: Our spending, saving, investing, and budgeting habits are influenced by a wide range of factors. Our past experiences mainly determine how we interact with money. Some of the common factors include; family, culture, and media. The media especially stands out as a significant influence on our spending habits. It emphasizes our desire to have the best of everything despite the realities of our financial situation.
Q: Which social media platform has the most significant influence on your spending habits?
A: A recent survey by OnePoll of 2000 Americans shows that social media has become very influential on people's spending habits, especially Instagram, Facebook, and Tiktok. Therefore, shopping on these platforms is expected to grow exponentially over the coming years. Today, most people will buy something just because they have seen it from an influencer's posts.
Q: How does social media influence consumer behavior?
A: Consumer buying behavior is easily influenced by promotions, discounts, and deals they have seen on social media. In fact, most of the time, consumers who are easily influenced by social media are four times more likely to spend on a specific item. Sometimes this influence can be so high that 29% of these consumers make the purchase the same day after seeing the item.
Q: What are the current consumer behavior trends?
A: Marketers are able to influence consumer behavior the more they know about consumer trends. Consumer habits and trends tend to evolve over time. For instance, the most common consumer trends currently are; online spending, transparency, green companies, and anonymity.
