Marketing’s New Frontier: Beware the Revolution

The Convergence of Marketing, Commerce and Technology

Advances in AI and personalised digital marketing have given companies the tools to reach their audiences with an unprecedented precision that can be incredibly effective – and appealing.

But these same technologies have also introduced new challenges around ethics, transparency and consumer trust (our interview with Sigurd Birk Hansen, a former NSC trainee, focuses on this very issue).

Exploring Modern Marketing Trends and Ethics

From the subtle use of psychological tactics in digital interfaces to the rise of AI-generated content and deepfakes, marketing is becoming a more complex – and sometimes darker – territory.

This chapter will explore these key trends, highlighting how companies leverage both cutting-edge technology and timeless psychological principles to influence consumer behaviour.

We’ll also take a look at ongoing concerns such as greenwashing, emphasising the importance of ethical marketing practices in an era of increasing consumer awareness and mistrust.

The theme that runs throughout is the need for authenticity. This is not new but it is becoming harder to achieve in a world where viral marketing is constantly copied, where consumers question claims made by companies and influencers and where AI is forcing us all to question what we see, hear and read. 

Welcome to the Dark (Pattern) Side: How Psychology can Explain Marketing Techniques

In the increasingly digital world of commerce, marketers are turning to psychological tactics embedded in the very design of the online shopping experience to influence consumer decisions.

Psychological Tactics and Dark Patterns in Digital Marketing

Some of these methods are legitimate ways to enhance user experience, others, known as dark patterns, are manipulative practices that trick users into actions they might not choose consciously – such as subscribing to services they don’t want, making purchases they didn’t intend or surrendering personal data without realising it. 

As digital interfaces grow more sophisticated, dark patterns have become a key strategy for companies seeking to maximise profits, often at the expense of consumer trust.

Mind Games: A Guide to the Psychological Phenomena at Play

Loss Aversion

Loss aversion is a concept from prospect theory (Tversky & Kahneman, 1979), and refers to people’s tendency to prefer avoiding losses over acquiring equivalent gains.

This psychological principle is central to many dark patterns, particularly those that involve scarcity or urgency.

Hurry!! E-commerce sites often display messages like ‘Only two items left!’ or ‘Limited-time offer!’ to create a sense of urgency. These cues trigger loss aversion, making consumers feel they’ll miss out on something valuable if they don’t act immediately. This taps into the human tendency to avoid loss – even if the ‘scarcity’ is artificially generated by the platform.

The Endowment Effect

The endowment effect suggests that people place higher value on things they already own or are in the process of acquiring.

Dark patterns capitalise on this by making users feel they’ve already invested time or effort into a transaction, so increasing their likelihood of completing it.

Hidden costs exploit the endowment effect by introducing unexpected fees late in the checkout process, after the user has already spent significant time selecting products. Since users feel emotionally invested in the transaction, they are more likely to follow through despite the surprise.

FOMO

FOMO (fear of missing out) a psychological phenomenon where individuals fear missing out on a desirable experience or opportunity, is frequently manipulated in marketing.

It’s especially prevalent in dark patterns designed to create a sense of urgency.

The ‘don’t miss’ deal is often used in the form of countdown times – ‘Only four seats left at this price!’ is an example popular on travel booking sites. Consumers, fearing they’ll miss a great deal, are pushed to make hasty decisions without fully considering their options.

Anchoring

Anchoring refers to the tendency to rely heavily on the first piece of information offered when making decisions.

This cognitive bias is frequently exploited in marketing by showing high initial prices that are then ‘discounted’ to make the actual price seem like a good deal, even if the initial price was inflated.

On sale now! Many e-commerce sites display ‘crossed-out prices’ next to an allegedly lower price, making consumers think they are getting a bargain. This anchored higher price, however, may not reflect the product’s true market value and instead serves to influence perceptions.

The Sunk Cost Fallacy 

The sunk cost fallacy occurs when people continue an endeavour simply because they have already invested resources – time, money or effort – into something.

This is manipulated in dark patterns to keep users engaged with a service or product even if they no longer want it.

Escape room or ‘roach motel’ designs are employed to make it easy to sign up for a subscription service but hard to cancel. Users often continue with subscriptions because they feel that they have already invested too much effort to quit, or they fear losing benefits they’ve paid for.

AI-Driven Personalisation and Manipulation

AI and data analytics have revolutionised personalised marketing, but they have also enabled more sophisticated manipulation techniques. AI-powered recommendation systems can exploit dark-pattern psychological tendencies by delivering hyper-personalised content designed to push consumers into certain actions.

For instance, AI algorithms may monitor browsing behaviour and identify when users are repeatedly visiting certain product pages without making a purchase.

The system could then use loss aversion or FOMO tactics, such as sending a ‘last chance to buy!’ notification, capitalising on the psychological biases that dark patterns are built upon.