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7 Powerful Cognitive Biases, Every Marketer and Product Person Must Know with Examples!

Cognitive biases are errors in the way we perceive our environments and make a judgment. And as they affect all of us, marketers can take advantage of this.

Marketing techniques have evolved greatly in the modern era. Marketing is no longer limited to just the idea of advertising and branding products. It is about creating awareness about products in the mind of the consumer such that a particular product can resonate better.

In digital marketing, targetting the potential customer is becoming better day by day.

This customer targeting can be done using a number of different ways. One of the best ways to do this is the use of cognitive biases.

These biases exist in humans inherently and they can influence a consumer’s rational and his/her reasoning ability.

For instance, we tend to easily buy a product if it is recommended by our close friends or colleagues,

“A compelling narrative fosters an illusion of inevitability.”

― Daniel Kahneman, Thinking, Fast and Slow

Let’s have a look at the 7 cognitive biases that will make your marketing strategy more effective:

1. Framing effect

According to the framing effect, consumers are more likely to make a purchase based on the way a product is presented.

For instance, if a shortcoming of a product is presented as a beneficial feature by making use of wordplay, it becomes more likely to be a success.

Example of Execution: Netflix: Sign up Page

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Netflix sign up page is brilliantly framed with the only CTA, TRY IT NOW,

Moreover, they have asked only email address, which makes a person’s workload to reduce.

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The next page clearly states all the advantages and fewer risk factors involved in it.

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Choosing the plan is also well-framed, Netflix shows BASIC as default options by highlighting the column.

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Finally, instant gratification is also depicted here.

This is how the framing effect can influence our customers in many ways, this makes them feel more comfortable in our hands and very less workload is required from their side.

2. Anchoring effect

According to the anchoring bias, a consumer is likely to purchase a product that was presented to him or her as the first piece of information.

Anchoring creates a brand recall in the mind of the consumers which results in the specified product being sold. Anchoring bias is used in stores to ensure that a particular product is pushed harder.

Example of Execution: Flipkart

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In this example, if anyone looking to buy a laptop sees this much amount of discount, there are many chances he may grab this offer.


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In B2C also this cognitive bias is used extensively, take a look at these pricing tables available. This clearly shows we are going to save a lot of money.

The anchoring effect is a critical part of NEGOTIATION.

3. Loss aversion

Creating a fallacy of a potential loss of something is one of the oldest tricks of marketing. The loss aversion bias is responsible for this technique is so popular.

If a brand manages to create an image in the mind of the consumers that by not buying a particular product, they are likely to lose out on something, it can successfully manage to achieve higher sales of its products.

People are more willing to avoid a loss as compared to gaining a similar amount.

Example of Execution: Amazon

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Fear of Missing out(FOMO) always influences a human’s mind. This bias is used from olden days yet it is so powerful.

4.Endowment Effect

This effect explains the increased attachment people feel to items they’ve already experienced or had some investment in, even to a minuscule degree.

This is the reason why many brands are offering their products/services to use for a period of time. Once we get used to it, we would naturally try to acquire it.

Example of Execution: Amazon Prime

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Amazon gives this offer to try their OTT services. It is natural that if one gets used to prime video’s easiness in accessing a movie, they will stick to it in the future.

5.Paradox of Choice

Having choices is usually considered a good thing. However, too much choice leads to cognitive overload and subsequent paralysis.

Firms may structure choices to avoid the paradox of choice situations where too many offerings drive customers to a competitor or make them fallback.

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This is because of what’s known as the paradox of choice (from Barry Schwartz’s book The Paradox of Choice – Why More Is Less). For certain industries, too many options can overwhelm the consumer and lead to a sort of buying paralysis.

“Learning to choose is hard. Learning to choose well is harder. And learning to choose well in a world of unlimited possibilities is harder still, perhaps too hard.”

 -Barry Schwartz, The Paradox of Choice: Why More Is Less

6. Availability Heuristic

Ever notice that logic is often neglected in favor of more emotionally powerful arguments?

If rationality takes a backseat to recent events which cause a powerful perceived impact, there’s a good chance the availability heuristic may be at play.

According to this bias, consumers often make illogical choices and then, later on, make logical arguments in order to justify their purchase.

In terms of marketing, if a product manages to create a desirability factor in the mind of the consumer, they will buy it and then, later on, justify their decision.

Example in Execution: Coca-Cola

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We all have tasted coke at least once in our lifetime but how many of us have thought about the rational benefits of having a coke?

Humans are “Predictably Irrational”

To get more insight into this bias, take a look at my previous article, How to Influence Your Customer to Make the Best Decision?

7. Bandwagon effect

The bandwagon effect is a cognitive bias which is well exploited by consumer goods companies as well as political organizations.

According to the principle, a consumer is more likely to purchase a product that is being purchased by others. This is because it can create an illusion of being useful.

A good way for marketers to exploit this effect is by creating advertising content that is focused on high sales already achieved by the product as well as popularity graphs.

This attracts new consumers and helps in achieving higher sales.

Example in Execution: Amazon -reviews

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Another natural tendency is to check reviews before buying any product. This is well used by amazon.

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Naturally, we tend to think, these many people cannot be wrong about this particular book.

Personally, I love it because “Maktub”

These are the 7 Powerful cognitive biases every digital marketer must know. This makes the marketing results to be more optimized.

There are more than 200 cognitive biases discovered so far. Check out them in this link,

Thanks a lot for reading,

With 💜 & 💡, Naveen

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