Retail Media: Unlocking the Psychology Behind Why Shoppers Say ‘Yes’
How to Sell More by Tapping into What Shoppers Already Want
Welcome to the 32nd Edition of Marketing Concepts!
You're carefully choosing running shoes online. As you're about to buy, a helpful suggestion appears: 'Moisture-Wicking Running Socks, 20% Off!' While unexpected, the offer feels right, seamlessly fitting into your shopping experience. This perfectly demonstrates the power of retail media – presenting relevant products at the ideal moment when you're most open to buying.
But why does this work so well? The answer lies in human psychology.
The Psychology of the Consumer Shopping Mindset
1️⃣ Commitment & Consistency (The "I've Already Decided" Effect)
💡 Psychology Principle: People are more likely to stay consistent with an initial commitment (Cialdini’s Principle of Commitment & Consistency).
🛒 Retail Media in Action:
Once a shopper decides to buy an item, they are more open to complementary products (e.g., a camera + memory card).
Retail media leverages this commitment by surfacing "Frequently Bought Together" or "People Also Bought" suggestions.
Why It Works: Since the customer is already in a buying mindset, adding one more item feels like a natural extension of their decision.
🔍 Example: Amazon’s One-Click Add-On Recommendations make checkout frictionless, increasing cart size without overwhelming the consumer.
2️⃣ Decision Fatigue & Cognitive Load (The Power of Simplifying Choices)
💡 Psychology Principle: Our brain prefers to minimise effort when making decisions.
🛒 Retail Media in Action:
Shoppers get overwhelmed by too many choices—especially after spending time evaluating options.
By strategically placing pre-selected suggestions, retail media removes the friction of searching for add-ons.
Why It Works: Shoppers perceive these suggestions as convenient solutions, reducing the mental burden of decision-making.
🔍 Example: Woolworths’ “Buy It Again” feature in its app reduces decision fatigue for repeat customers by surfacing past purchases.
3️⃣ The Power of Immediate Gratification & FOMO (Why “Now” Matters More Than “Later”)
💡 Psychology Principle: People prefer instant rewards over delayed ones (Temporal Discounting).
🛒 Retail Media in Action:
When shoppers see limited-time offers, urgency is triggered—leading to faster decision-making.
Why It Works: Consumers fear missing out on a deal, especially when it complements a purchase they’ve already committed to.
🔍 Example: JB Hi-Fi’s "Buy Now & Save 10%" on checkout pages taps into the FOMO effect, pushing impulse buys.
Why Retail Media is More Than Just Ads
Retail media doesn’t just push products—it reshapes consumer behaviour by:
1️⃣ Personalising the shopping experience. Ads feel less intrusive when they align with what the shopper actually wants.
2️⃣ Eliminating friction. Instead of searching for additional products, shoppers get smart, curated recommendations.
3️⃣ Creating emotional resonance. Shopping is an emotional process—retail media capitalises on the moment of purchase excitement.
The Bigger Implications of Retail Media
The impact of retail media goes beyond just conversions—it’s changing how brands interact with consumers.
🔹 For Consumers:
✔️ Less noise, more useful recommendations
✔️ Shopping experiences that feel more intuitive & personalised
✔️ Instant savings & bundled offers that provide extra value
🔹 For Brands:
✔️ Higher ROI compared to traditional digital ads
✔️ Better targeting thanks to first-party retailer data
✔️ Stronger consumer trust by appearing within a familiar shopping environment
Closing Thoughts
Retail media isn't just another marketing channel; it's the future of how we engage consumers. By understanding human psychology, it transforms advertising from an interruption into an enriching part of the shopping experience.
🔹 Next time you see a checkout ad, ask yourself: Was this an interruption… or a helpful nudge? 🚀
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