How the science of Consumer Psychology grew in parallel with the consumer society 1

CONSUMER PSYCHOLOGY -COUN 405

1. What is consumer psychology?

Consumer psychology is an interdisciplinary area that helps us to understand why
and how individuals and groups engage in particular consumer activities and how
they are affected by those choices. It mainly focuses on the cognitive processes and
behaviours involved when people buy and use goods and services. The cognitive
processes help us to understand how people process information and how they
subsequently act.

The discipline combines research methods and theories from psychology,

marketing, advertising, economics, sociology and anthropology. Some of the areas
of interest in consumer psychology include;
 Decision making
 consumer judgment
 perception and attention
 information processing
 motivational determinants of consumer behaviour
 attitude formation and change
 Influences of advertising upon consumer behaviour

2. Why study consumer psychology?

In our contemporary society we are all consumers as we engage in consumer
activities such as travelling, grooming/use of beauty products, listening to music,
reading a book, eating in a restaurant etc. This shows that almost all behaviours we
engage in as humans in our daily lives are directly or indirectly related to
consumption. Hence consumption is an integral part of our lives. Examine some of
the following and discuss how they relate to consumption:
 Christmas celebrations,
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 Birthday celebrations
 Home coming celebrations
This shows that we are living in a consumer driven economy and therefore
consumption needs to be carefully studied as it is a key aspect of human behaviour.

3.Brief history of consumer psychology developmental milestones

The culture of consumption started before the industrial revolution .Between
seventeenth and eighteenth century there was a great increase in consumption
throughout Europe and this trend escalated during the industrial revolution when
rates of consumption went up globally.
1800s
This corresponded to spread of industrial revolution in Europe and America. There
were fundamental changes in transportation, metal manufacture, textile, agriculture
and the social structure. This necessitated increase in food supplies, raw materials
and advancement in technology and as a result production levels went up. At the
same time, scientists started getting interested in understanding role of consumer
society in influencing consumer behaviour.

1840–1920

During the 1840s Volney Palmer opened the first advertising agency in the world
which offered services as brokers for advertising space in newspapers. Gradually, the
number of advertising agencies increased which offered a wide range of advertising
related services.

Though production levels had increased the range of goods available was limited. In
1852, the world’s first department store, Le Bon Marché, opened in Paris and soon
others like Macy’s opened in New York in 1878.
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In 1879, the first experimental psychology laboratory was set up in Leipzig by a

German psychologist named Wilhelm Wundt.. He was one of the founders of the first
major school of thought in psychology known as structuralism which focused on
understanding the structure of the mind, especially the immediate conscious
experience. Wundt viewed attention as part of perception that humans are consciously
aware of, hence the most relevant area to Consumer Psychology.

Harlow Gale, a student of Wundt got interested in the effects of advertising on

attention and memory and conducted a series of surveys and experiments on the
subject. In the early 1900s while a lecturer at Minnesota he ran one of the first
experimental psychology laboratories in the USA. During this period, experimental
psychologists realized that consumers were influenced more by emotions than
rationality because advertising captures attention and appeals to emotions.

In 1909 a truck of Coca-Cola Company containing Coca-Cola syrup was seized by

the US government .Later the company was charged with selling a drink containing
caffeine which was regarded as a harmful ingredient. In 1911, the company engaged a
psychologist by the name Harry Hollingworth to study the effect of caffeine on human
behaviour. Hollingworth’s findings showed that caffeine had no detrimental impact
on cognitive or behavioural performance even when consumed in larger doses than in
a bottle of coke. As a result, Coca-Cola win the case but lost at the Supreme court.
Later Hollingworth continued to research how advertisements affect purchase
behaviour.

In 1913, Henry Ford invented the assembly line in 1913 which made manufacturing
easier and cheaper and cars became affordable by many people. This led to rapid growth
in manufacturing practices, hence increased competition between products and brands
which increased the need for advertising.
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During the 1920s and 1930s, consumer related advertising and research flourished.
Prior to the world war, the sales of various goods escalated but the trend changed when
the world war began.

1939–1970
During the World War II, there was an inevitable food shortage .The Department of
Agriculture in the US called upon Kurt Lewin, a social psychologist, to help convince
Americans to eat high protein foods such as hearts, kidneys and livers that had
previously been thrown away.

After the world war II, consumption around the world gradually started picking
up again and consequently a renewed interest in advertising emerged. At the same
period, Ernest Dichter introduced Freudian concepts into the US advertising
industry. Dichter wanted to understand how consumers’ unconscious desires
influenced consumer spending.

After the world war governments around the world were looking at ways to strengthen
their economies mainly through consumer spending. By 1950s politicians were busy
promoting the benefits of living in a consumer society which led to an increase in
advertising .Up to 1960s, a lot of consumer related research mushroomed .This
corresponded to the period the UK opened its first commercial TV station (1955).This
dominated the media industry until 1982 when another TV channel (channel 4) was
launched.

In 1960, Division 23 of the American Psychological Association was established. It

was then called the Consumer Psychology Division and in 1988 the name changed to
“The Society for Consumer Psychology”. During the 1960s a string of well-known
consumer behaviour books also were published. The Annual Review of Psychology
published the first article reviewing Consumer Psychology as a subject area.
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INFLUENCE OF PSYCHOLOGY ON CONSUMER BEHAVIOUR