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How Instagram Ads (And My Cognitive Bias) Convinced Me To Buy $100 Leggings


A sale that touts a “great deal” available “today only” or while “supplies last” is a textbook … [+] example of how companies create a perception of scarcity to drive sales.

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Humans are hard-wired with cognitive biases – the little shortcuts our brains take to help us sort through information and make quick decisions. The problem is, too often those biases can be erroneous, emotionally-driven, and fail to take in the nuance, research, and patience needed to make truly accurate conclusions based on critical thinking.

Cognitive biases can be particularly troublesome when people are pressed for time, emotional, under stress, or feeling impulsive. In other words, during the holiday season.

Everyone likes to believe that they have good judgment – be it about a political belief or confidence that they’ve made the best decision possible when purchasing goods or products. But the reality is that retailers and marketers have nearly perfected using our cognitive biases against us to drive sales and increase profits.

Behavioral psychologist Daniel Kahaneman came up with the theory of cognitive biases. He was among the first to understand that the human brain is wired for making decisions in two fundamentally different ways: we have a fast, automatic, emotional system, and we have a thoughtful, calculating system.

Shoppers use the fast system when spending on stuff with an emotional appeal, like fashion or entertainment. The more methodical process is used when making practical purchases, like computers or appliances. Retailers know this and they match their marketing to fit their products.

One of their standard go-to tactics is tricking shoppers by playing on the “anchoring bias.”

The anchoring bias occurs when people – in this case shoppers – make judgments based on often irrelevant but easily accessible facts. The human brain gives a lot of weight and credence to first impressions, especially as they persist to numbers and statistics. In retail, that often means our impression of whether a product is a “good deal” is shaped by the first price we see.

For example, “athleisure” leggings are a hot item this shopping season. Marketing, word-of-mouth, and viral campaigns on social media tout special sweat-wicking material, soft fabric, and the look of leggings. And our brains have been trained – or “anchored” – to believe that the trendiest leggings will set us back $100. So, when a shopper sees a popular brand of leggings “on sale” for, say $85, they’re more inclined to believe that’s a good deal, even though there’s no reason the leggings should have been priced at $100 in the first place.

Another way retailers tap into our cognitive biases is by using the “bandwagon effect.” This is when marketers convince consumers they need to jump on a trend or movement. Often, companies will create sales or promotions that couple the anchoring bias with the bandwagon effect to produce an emotional, snap decision: “All your friends are wearing our hot new leggings. Get yours today for $85 – a 15% discount!” (There’s also a bit of the “Halo Effect” here – a cognitive bias that occurs when we let positive traits that we associate with our friends spill over into our perception of the leggings.)

As if that’s not enough, marketers will also ramp up the pressure and the stress – and, hopefully, push you into a sale – by creating false deadlines and praying on the “scarcity bias.”

Black Friday and its newer cousin, Cyber ​​Monday, are little more than sophisticated marketing ploys built around the scarcity bias. A Cyber ​​Monday sale that touts a “rock bottom price” that is available “today only” while “supplies last” is a textbook example of how companies create a false deadline and a perception of scarcity to drive sales.

The positive endorphins felt from a satisfying purchase are real. And the feeling of being trendy or feeling like a savvy shopper can cause many of us to muffle our critical thinking skills and amplify our cognitive bias. How can consumers take back some control?

The first step in better thinking is to actually engage in thought. People should pause and reflect on their decisions, applying rational thought instead of engaging in automatic responses or raw emotions. This can often be the hardest step, because it requires us to recognize when we need to turn off our “fast” decision making system.

Once that’s accomplished, shoppers should ask lots of good questions of themselves and of the product they’re about to buy. They should conduct independent research on products, and take a moment to honestly assess why their cursor is hovering over the “add to cart” button. Would they be as moved to click “buy now” if their research uncovered conflicting reviews? Is this amazing sale really going to end at midnight? Is it a sale at all?

None of this is easy to do when the holidays are bearing down on us, time is short, and stress is high. This time of year, it’s crucial to lean a little more on our critical thinking skills to get us through, and to realize when marketers are playing to our cognitive biases.

After all, you didn’t really need those leggings, did you?


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