What Is Consumer Psychology and How Can It Benefit Your Business?

As a commerce business, understanding consumer psychology can help you understand your buyers. Modern buyers want to feel special; they want personalized products and experiences. They are part of an evolving consumer wave where they demand their needs be met, and don’t want to have their needs told to them by brands. Getting to the bottom of who your buyers are is an intuitive next step for retailers, and grasping consumer psychology can help.

Ahead, unpack what consumer psychology is, outline the four main buyer types, and get tips on how to apply the key principles of this multifaceted field to your business—and make your buyers feel special. 

Table of contents 

• What is consumer psychology?
• The 4 buyer types
• Understanding consumer behavior
• Next steps: Practical applications of consumer psychology
• Consumer psychology FAQ

What is consumer psychology?

Consumer psychology is a multidisciplinary field of study taking commerce, traditional psychology, and marketing into consideration to understand the purchases of buyers.

This psychology takes into consideration what marketing and advertising techniques and strategies work on buyers, and how or why they decide to buy from the brands they do. 

Buying represents so much more than just the product itself and its use. It braids together many different psychological principles, but a few of the big ones are:

• Identity: How does this purchase reflect the buyer?
• Communication: How does a customer like being spoken to in advertising? 
• Social status: Does this product elevate a buyer’s social standing?? 
• Mental health: Are they purchasing this product because their emotions are disregulated?

The 4 buyer types

Buyer types exist across the spectrum of customer personalities, ranging from the sharpest researcher to the dedicated trend seeker. Every buyer type is formed into this persona by some of the above psychological principles and their environment, and each seeks out different shopping experiences. Some want to be supported in different ways. 

Tailoring the shopping experience to each type doesn’t have to be laborious with the right information and tools to reach those customers. Below is a breakdown of each of the four types of buyer personas: Pragmatic Planners, Engaged Explorers, Trend Trackers, and Savvy Searchers. 

Pragmatic Planners

Key qualities: 

• Loyal to a brand they can trust in
• Appreciates limited but relevant marketing 
• Reliable buyer

The Pragmatic Planner doesn’t particularly enjoy researching or shopping and tends to stick to the brands they know and trust. They prefer to research their options online and buy in-store, likely on pre-planned, one-stop-shop trips.

Pragmatic Planners need to trust the stores they buy from. When they order from your brand for a second time, offer them a personalized discount code via text message. Since this group of buyers doesn’t want to engage with marketing, you’ve got to prove you’re only reaching out when there’s a relevant need.

Take jeans as an example. Jean shopping is about specificity (e.g., fit, style, or brand notoriety).

It’s a product that can warrant an in-store experience. If the Pragmatic Planner is doing the buying, they will also do their research online. They have made a list, cross-referenced the product, tried it on in-store, and found themselves loyal to a fit so perfect, they won’t want to shop anywhere else. They will be more agreeable to online purchasing, especially if it is incentivized with personalized discounts in the future. 

The Pragmatic Planner is a reliable consumer. They are meticulous about their methodology, strategy, and the buying process. They want to know their purchase is going to last. Providing an equal effort of consistency in both the product and research, as well as promotional incentives to keep them interested, makes it easier for a shopper to keep trusting a brand. 

Engaged Explorers

Key qualities: 

• Validates their decisions through thorough research, especially customer reviews and ratings
• Enjoys buying new products and trying new experiences but with consideration
• Shopping experience needs to feel good to them

Engaged Explorers like to buy new things and shop to make themselves feel good. They prioritize a great deal on a familiar brand, relying heavily on reviews and sharing advice with their networks. They want to be validated by another voice they trust, like a close friend or a review by another customer that rings true to them. There is a level of earnestness involved in their pursuit of products. It is largely because of the underlying truth that Engaged Explorers want to look and feel good in whatever they own. 

For the Engaged Explorer, being able to sample products matters—the tangible, sensory component of trying a product before buying goes far with this persona. This buyer also wants several dedicated resources on hand to complement that experience, such as beauty consultants, experts, and salespeople as support. 

On top of sampling and inspecting lipsticks by browsing in-store or online, there are so many third-party resources highly valued by this type of buyer. Online, an Engaged Explorer reads customer reviews and engages with digital consultants, even customers in the comment section. Magazines and blogs occupy a slice of that information pie, but so do beauty influencers on TikTok, YouTube, and Instagram. There is a wealth of information on hand, whether a buyer is a burgeoning or experienced beauty aficionado. 

Trend Trackers

Key qualities:

• Spontaneous shopper looking for the trendiest product, regardless of cost
• Not into giving out personal information that can be used for marketing
• Seeks out experiential shopping experiences to turn them into a brand evangelist

Trend Trackers live a little more spontaneously. While they might be hesitant to provide personal information, and are largely cost-conscious yet impulsive, they strongly prefer to buy in-store, even after doing research online. For their research methodology, Trend Trackers monitor the cultural direction of products they want. They look at cost comparisons and advertising, but experience and cultural clout rank highest on their priority list. Trend Trackers feel strongly about being part of something. Being part of a group implies a certain status level and that value for a Trend Tracker factors into purchasing decisions.

This is especially true in fashion and footwear, particularly in the exclusive and vogue-ish world of streetwear. Streetwear is an exciting avenue for purchasers because it feels like an elite experience in a cultural pocket. This kind of buyer flocks to events like an exclusive shoe drop at a pop-up location, and only that location. It is comforting for a Trend Tracker to see how an experience, and their participation in it, generates a conversation larger than the product. 

Everyone needs to wear shoes to get around. But Trend Trackers are concerned with more than just the practical. They wonder what the cultural, social, or fashion value is with their purchase. That takes time and some research. As practical as a shoe is, there is an importance in investing in a product that is a symbol of a movement they highly identify with at that time. 

Trend trackers are drawn to temporary experiences. A brand evangelist is born when a retail strategy includes experiential, ephemeral purchasing moments. From there, these buyers spread a gospel about the brand, influencing other potential buyers. It’s sort of like a domino effect. A newbie to the brand will want to engage with whatever experience occurs around the product, not wishing to be left out. A memory of an event associated with a purchase is a powerful retail tool. 

Savvy Searchers

Key qualities:

• A discerning shopper who uses any and all digital tools for research before buying a product 
• Often looks for the best price and quality for their purchase 
• Appreciates options for support and engagement, and will remain a loyal customer if not marketed to a lot

Savvy Searchers are the online wunderkinds of commerce who are comfortable with using a variety of digital tools to conduct research and look at product options, and need a lot of information before making a purchase decision. They have high expectations for the quality of their purchases.

Savvy Searchers demand a higher quality than the other four types of buyers. Because of this, it leads them to a longer-term investment with a product and/or brand. 

While Engaged Explorers need hands-on product and brand research, and Pragmatic Planners are meticulous with purchase inquiry, Savvy Searchers sit somewhere in-between the two. They don’t need to be marketed to (Pragmatic Planners) or require product engagement (Engaged Explorers); Savvy Searchers are nimble internet investigators and prefer to take charge of their own retail experience. 

Think of book buying, where trust is built for a return purchase. It’s important to offer resources to see if a buyer is getting the best deal, to let them know if the store is well stocked. The Savvy Searcher will thoroughly go through what stores offer, both in-person and online, researching product reviews, comparing and contrasting costs of the product across different retailers. They also look for deals. After all, they are Savvy Searchers. Marketing works selectively for a Savvy Searcher, since they are already in control of what they’re looking for. The most effective ads for this type of buyer are transparent, simple, and direct. They fill in the rest with complementary research of their own. 

The Savvy Searcher goes through a more holistic experience of buying and purchasing. They need to familiarize themselves with their options before stepping into buying action.

Understanding consumer psychology

For many of today’s brands, understanding your customer and their needs is crucial for success. You can’t expect customers to want products from a brand that treats them as one-size-fits-all. Buyers expect personalization and speed in the buying process—and to be wooed in the first place. 

Products and brands become ways for buyers to represent who they are. For sneakerheads, it’s the latest drop from the hottest, most well-known brand. Some buyers may be influenced by, well, influencers, and see those people as a reflection of the life they want to live so they buy similar, if not the exact same, products. 

Understanding consumer psychology and the key components of emotional response, perception, and attitude mean you can build out a plan or goal to capture the kind of customers you know will buy from you. In the digital era and beyond, understanding how and why your customer is buying your products (or not) is important to both them and your bottomline. 

Next steps: Practical applications of consumer psychology

Unpacking how your customer makes commerce decisions is one thing. Applying it to your business strategy to ensure you’re capturing the right customers and growing your audience is another. If you understand your ideal customer, a persona, or who your average customer is, what can you do with that? 

Apply consumer psychology to your business to: 

• Create hyper-targeted segmentation of your customers
• Personalize the buyer experience with data 
• Deliver buying experiences and products you know your customers want 
• Produce marketing materials and positioning that resonate with your individual customers
• Automate tasks like sending emails for abandoned carts, repeat purchases for loyal buyers, and more
• Collab with your buyers’ favorite influencer or creator on a limited edition drop or marketing

One buyer’s goal is distinct from another’s. Each has a process through which they make decisions, and they all potentially differ from each other. 

This sounds like a complicated request—managing and understanding the buying behavior of so many kinds of people—but the variation is quite exciting. Sameness is not like consistency. Striving to understand the myriad buyer types and their needs allows for distinct, varying experiences, products, and longevity in the market. 

Keeping up with how buyers personalize and emphasize their needs and wants is a benefit to any retailer. Remember: market for your customers, not to them. Different kinds of buyers respond to different marketing strategies (or no marketing strategies!) and are motivated in different ways when making a purchase. Research why and how a buyer wants what they want, and the ways in which behavior affects a purchasing decision. Then, try to fulfill those individual needs.