Managing your Personal Finances Wisely

Moneywise24 Personal Finance



How Marketing Tricks Our Mind 1

Posted on November 20, 2009 by admin

It is not that I don’t like marketing; on the contrary, I studied marketing myself, and I believe it is a great tool for presenting new and innovative products to the crowd.  But the principles of marketing go much further than simply informing the crowd of a product. One of the goals of marketing campaigns is to motivate people to buy the product, to compete with the competition, and basically to get the consumer wanting the product badly.

But we have to be honest to ourselves: how can a marketeer, or a campaign, make consumers want to buy a product? Is it not our own decision to buy or not to buy a product based on our own evaluations and intelligence? Yes, we do make the decision ourselves, but what is our decision based upon? Is it based upon our true, unbiased objective observation, or is it based on what others make us believe is an objective, unbiased observation?

Marketing has many ways of promoting products to consumers in one way or the other. Below, I have listed a few of these methods. The list may not be exhaustive, and I would welcome comments and suggestions on how to expand the list further in detail.

Creating the need for an emotional state of mind

How often do you happy families, women, men, children, laughing and enjoying themselves in commercials? Depending on the product, marketeers aim at associating a special feeling or situation with the product; on a subconscious level, it means that buying that product would lead to that special feeling. The people in commercials are overly good-looking, confident, smiling, and consumers believe they will get all that when they buy the product. Creating that feeling involves the images, but also the colors used, the music and the sounds, the setting and surrounding… nothing is left out.

This association of a state of mind, or emotion, with a particular product might not lead to everyone running to the supermarket and buying the product. However, having seen that commercial 25 times, what is likely to happen when you accidentally see the product somewhere in the store? Exactly, you immediately associate the product with that feeling, and in a sense your unconscious mind has been conditioned to do so; you are likely to buy that product, even if there is a better and less expensive alternative standing right next to it.

Professional recommendations

“This product has been recommended by…”
“Thousands of people have tried this product, and they say…”

Recommendations from specialists, institutions, or simply people on the streets are a powerful tool to creating the illusion that the product must be good and worth buying, since so many people are using it. Personal skepticism is less likely to occur, since we tend to trust recommendations from others.

Making the product scarce

If a product is scarce, it usually implies that it is either extremely valuable or highly wanted. Many commercials and advertisements create a situation, in which the product is characterized as being scarce. Think about the following statement:

“Buy now, only 2,000 samples left!”

Games with wording

Our own language is often used against us. Marketeers have the fine ability to play with words in such a way, that we give a meaning to it that benefits us most. A great example of this is the expression “saving money”, which could  mean any of the below:

  • setting money aside for the purpose of not spending it (and usually gaining interest on it)
  • spending less money than planned

The first meaning usually earns you money, while the second meaning still means spending money. In a commercial I saw in Germany, the following statement was made:

“Having saved 10 Euros means having earned 10 Euros!”

This is, of course, an illusion, since you could impossibly earn money while you are spending it. Still, hundreds of people line up at major discount events, buying loads of items they probably don’t even need. They feel good, since they believe they have actually saved a lot of money on computers, televisions, or high quality branded clothing. But what they forget, is that they have still spend hundreds of Dollars, which they might have otherwise not spent at all.

Doing the maths

Consumers are very price sensitive, and therefore companies try to make their products as financially beneficial as possible. When it comes to debt, some companies stated monthly interest rate, making them appear extremely low. Other companies promote a very low monthly fee for a service, which comes only with an annual membership and annual payment possibilities. Some stores might increase the price of their products a few weeks before they start promoting major discounts… sometimes the discount price is higher than the original price.

These are only a few examples of how marketing works, and the methods that companies and corporations utilize in order to make their products wanted. As I mentioned before, marketing is a great tool for the purpose of bringing products to the masses. However, we as a consumer need to be conscious of the fact that many marketing campaigns are manipulative in one way or the other, and that only we can make the right decision, that benefits our needs.

Possibly Related Posts:


  • Add to favorites
  • Blogger
  • del.icio.us
  • Facebook
  • Google Buzz
  • Haohao
  • MSNReporter
  • RSS
  • Tipd
  • Twitter
  • YahooBuzz
  • Digg
  • email
  • MySpace
  • Reddit
  • StumbleUpon
  • Technorati

The Difference between Needs and Wants 1

Posted on November 15, 2009 by admin

We all want a big estate, a powerful car, stylish clothes from the finest brands, and so on. While many of these things certainly can be realised, having a grip on your finances is all about identifying your own and personal ‘needs’ and ‘wants’, and acting accordingly.

Let us look at what a ‘need’ is in the first place. Basically, a ‘need’ is anything which makes it possible for you to live in a safe environment and to reproduce, at least that’s how I look at it. This includes food, water, shelter, love and sex (including also social contacts). Be honest to yourself: do you really need anything else to survive? However, these basic needs may cause you to live fairly uncomfortable in the modern world. For this reason, I want to take it one step further for the purpose of this article and re-define what a ‘need’ is:

A ‘need’ is anything which makes it possible for a human being and his/her family to life a comfortable and exciting life.

Following this definition, what a person needs differs per individual. No two individuals are completely the same, and their needs may lie far apart.

Have you ever heard one of your friends say ‘but I needed this new pair of shoes’, knowing that the pair will end up in the closet together with 52 other pairs? Probably yes, and this is the essence why many people end up in a situation of debt, sometimes so severe that there is no way out of it but to file for personal bankruptcy (if you are such a person, please seek professional help from an independent advisor; the information on this website will not be sufficient to eliminate your debt).

Knowing the difference between needs and wants, it is essential to ask this question each time. If you are not used to it, it is very easy to let yourself go in the process. If you have a credit card readily available, it does not make things easier. The essence is that each purchase should contribute to the quality of your life significantly; it should enhance and enrich your life. If this is not the case, you may do yourself a big favour and leave the item where it is.

Reminding myself of my own definitions of ‘needs’ and ‘wants’ have significantly helped me to keep my own finances in control.

Possibly Related Posts:


  • Add to favorites
  • Blogger
  • del.icio.us
  • Facebook
  • Google Buzz
  • Haohao
  • MSNReporter
  • RSS
  • Tipd
  • Twitter
  • YahooBuzz
  • Digg
  • email
  • MySpace
  • Reddit
  • StumbleUpon
  • Technorati


↑ Top
SEO Powered by Platinum SEO from Techblissonline