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Mike valkenburg mba 592-fear in marketing
- 1. MICHAEL VALKENBURG MBA-592 “The oldest and strongest emotion of mankind is fear”-H.P. Lovecraft
- 3. INTRODUCTION •Marketing vs. Advertising •Products developed or adapted to maximize effect of fear •Not just advertising but preying on existing fears •Evolution •Began to emerge in the 19th Century. •Increased in use in the 1920s •Capitalized on world events •New products designed to exploit fears •One of the most effective advertising appeals
- 4. 19TH CENTURY AD 1920s LISTERINE AD HAND SANITIZER AD
- 5. INTRODUCTION •Effectiveness •Feeds off current events and the media •Physical response/psychological response •Association between products and services with safety •Fear appeals are stronger motivators than features •Disadvantages •Can be ineffective when not used correctly •Fine line between effective and repulsive •May miss or alienate target market •Credibility issues
- 6. OVERLY GRAPHIC CREDIBILITY ISSUES
- 8. •Shock •“Shockvertising” •Highly effective in health marketing •Extremely graphic •Can be ineffective if message or images are overly disturbing •Scarcity •Creates illusion of limited availability •Generates an inflated perceived value •Stresses time and quantity •Fear of scarcity makes online auctions effective FEAR APPEALS USED IN MARKETING
- 10. •Guilt and Shame •Work effectively together •Can be used to customize online marketing •Test of Self-Conscious Affect-3 (TOSCA) •Fear, Uncertainty, and Doubt •Originated in the software industry in 1970s •Diverts buyers’ attention away from competing products •Fear of being left out leads to action •Effective when used positively, ineffective when used negatively FEAR APPEALS USED IN MARKETING
- 11. GUILT AND SHAME
- 12. FEAR APPEALS USED IN MARKETING •Self-preservation •Instinctual desire to stay alive and reproduce •Human intelligence allows for logical response to threats •Advertising is effective because of humans’ complex memory •May backfire if ads are overly frightening •Presents life or death scenarios
- 14. TYPES OF FEAR APPEALS USED IN MARKETING •Disgust •Effective at marketing health and hygiene products •Relies heavily on images •Can be a more powerful motivator and create lingering memories •Like other fear appeals will backfire if message is too strong or images too graphic
- 18. •“Little Albert” •Sought to show effectiveness of fear in altering human behavior •Modeled after Pavlov’s experiments •Clearly showed results of fear conditioning and response •Mobbs’ Fear Reaction Study •Set out to determine how complex of an emotion fear is •Used MRI to measure fear reaction while test subject played a video game PSYCHOLOGICAL AND BEHAVIORAL STUDIES
- 19. “LITTLE ALBERT”
- 20. •Rapaille’s “Reptillian Brain” •According to Rapaille, humans posses a reptilian brain •Some cultures far more reptilian than others •Humans attach words to emotions, which vary by culture •Marketers need to be conscious of these differences •American buying decisions are often impulsive and fear- driven PSYCHOLOGICAL AND BEHAVIORAL STUDIES
- 21. RAPAILLE’S 3 BRAIN SEGMENTS
- 22. •Thayer Model of Arousal •Process starts with creation of tension •At the right level, tension creates positive emotions •Beyond the tipping point, creates high anxiety •Marketers must find correct balance PSYCHOLOGICAL AND BEHAVIORAL STUDIES
- 25. •General Anxiety Disorder •GlaxoSmithKline popularized GAD to market Paxil in 1993 •Fast FDA approval since already approved for other disorders •Loose definition in the PDR made GAD a catch-all disorder •Social Anxiety Disorder •GlaxoSmithKline received FDA approval in 1998 for Paxil as SAD treatment •Powerful fear-based marketing campaigned ignited sales FEAR-BASED MARKETING IN HEALTHCARE Emergence of New Diseases and Disorders
- 27. •Post-traumatic Stress Disorder •Pfizer received FDA approval for Zoloft to treat PTSD •Formerly almost exclusive to combat veterans: “Shell Shock” •According to Pfizer, 1 in 6 children, 1 in 13 overall, suffer from PTSD •Sales boosted by 9/11 terror attacks and war in the Middle East FEAR-BASED MARKETING IN HEALTHCARE Emergence of New Diseases and Disorders
- 28. Multiple Causes and Symptoms of Metabolic Syndrome
- 29. •Metabolic Syndrome •Formerly known as Syndrome X, precursor to heart disease and diabetes •Sought to replicate success of cholesterol reduction craze •Preys on fear of sudden death, obesity, diabetes, and IBS •Several health issues rolled into one requiring multiple medications •Major health problem or new venue for revenue? •Metabolic syndrome drug market increased to $13 B in 2013 FEAR-BASED MARKETING IN HEALTHCARE Emergence of New Diseases and Disorders
- 30. Multiple Causes and Symptoms of Metabolic Syndrome
- 31. RISE IN METABOLIC SYNDROME DRUGS INVOKANA: TYPE 2 DIABETES LIPITOR: CHOLESTEROL
- 32. FEAR-BASED MARKETING IN HEALTHCARE Emergence of New Diseases and Disorders •Attention Deficit Disorder •Fear of failure, lack of normalcy, and rejection for children •Steep rise in Adult ADD •Two decade campaign by pharmaceutical companies to publicize the disorder and sell medications •Life long disorder leads to unemployment, relationship problems, addiction, and worse, later in life •Often diagnosed with minimal symptoms
- 33. ADD ADS
- 34. •Fear-based marketing extremely effective at targeting public health issues •Shock, shame, humiliation, guilt, and shame. •Goal is to influence poor health choices and behaviors •Raises many ethical questions •Can appear as “victim-blaming” •May stigmatize target audience FEAR-BASED MARKETING IN THE MEDICAL FIELD: Public Health Marketing
- 37. •U.S. accounts for 31% of guns owned worldwide •Unrealistic perception: fear of crime •Sales fueled by fear of terrorism and gun control •Massive spikes in sales following recent mass shootings •Sales have risen from 7 million in 2002 to about 15 million in 2013 PERSONAL SAFETY: Gun Ownership
- 38. Gun Sales (per month): 2000-2014
- 39. Gun Production by Type: 2000-2014
- 40. •Sales of home security systems rise even as crime rates fall •US sales increased 80% to $24 billion between 1996 and 2005 •Fear of crime: perception of world as more dangerous than it is •Smart security system sales up from $500 million in 2013 to nearly $1 billion in 2015. •Total U.S. Home Security Market revenues have climbed from $7.21 billion in 2006 to $10.54 billion in 2012 PERSONAL SAFETY: Home Security
- 41. Home Security System Sales
- 42. PERSONAL SAFETY: SUV Sales •SUVs gained popularity among the wealthy in the 1980s •Projected image of family safety and comfort •Became popular with middle class in early 1990s •Hummer appealed to those seeking a militaristic vehicle •Sales of SUVs soared after the 9/11 terror attacks •Remain high due to fears of terrorism and crime
- 43. Sales of SUVs
- 44. •Complex supply chain and inadequate inspections have led to increased food recalls •Growing concern about artificial ingredients in food •9 million Americans sickened from contaminated food in 2013 alone •Consumer trend towards healthier, local-grown organic options •Hurting major processed food producers •Major retailers adapting to organic trend PERSONAL SAFETY: Food Safety
- 45. Organic Food Ad
- 47. FINANCIAL FEARS: Identity Theft •Increasing use of electronic transactions has greatly increased risk •High profile cases of credit card security failure •Identity theft: 14% of all complaint filed with FTC. •Two million complaints filed on $1.6 billion in fraud claims in 2013 •Identity Protection companies seeing massive revenues
- 48. Identity Theft
- 49. FINANCIAL FEARS: Debt Relief Services •Strong-arm collection techniques raise fear in debtors •Collectors make false claims of authority to intimidate •Soaring consumer credit and payday loans increasing collections •Fear of collection actions serve as marketing for debt relief services •Debt relief services are seen as saviors from evil collectors •Many relief services charge huge fees and may not resolve debt
- 50. Debt Relief Ad
- 51. •IRS is especially fearsome due to size and power •Unlike debt collectors, they can garnish wages, seize bank accounts and assets, and put offenders in prison •Complex tax codes can be daunting and confusing •Tax settlement firms offer to reduce or eliminate taxes due •Many of these firms overstate their expertise •As with debt collection, massive fees for unnecessary service •Make exaggerated claims about tax debt reduction FINANCIAL FEARS: Tax Resolution Companies
- 53. •Greatest fear the elderly face is running out of money in retirement •Financial products such as reverse mortgages seek to exploit this •Eligibility requirement: 62 or over with little or no liens on property •Borrowers are given a home equity loan payable when the homeowner dies or the property is sold •Drawbacks: May effect benefit eligibility, high closing costs and interest, and diminished estate value •Should only be considered as a last resort FINANCIAL FEARS: Reverse Mortgages
- 55. •Burst of the housing bubble left many homeowners underwater •Fear of being left homeless left homeowners vulnerable •Predatory lenders offer high or adjustable rate loans •Many borrowers end up far worse off after “no upfront cost” refinances FINANCIAL FEARS: Foreclosure
- 56. Redefault Risk
- 57. CONCLUSION •Would other methods be more effective? • https://www.youtube.com/watch?v=CoWaNa70FqQ • https://www.youtube.com/watch?v=OFQ6YoDAoeY •Does the fear used in marketing raise anxiety in society? •Has the use of fear in marketing gone too far?
- 58. QUESTIONS?
Editor's Notes
- -I’m going to discuss the use of fear in marketing and how it preys on the most primal human emotion.
- -This project will discuss use of fear and negative emotions in marketing, how it has grown and changed over the years and the types of negative emotions employed by marketers to elicit consumer response and generate demand for their products and services. -Several psychological studies will be presented to illustrate how fear causes such a strong reaction in humans and why it’s such a powerful motivator. -This will be followed by examples of how fear and negative emotions are used to gain an advantage in several different industries: healthcare, personal safety and financial safety. -In conclusion the effect that this type of marketing has had on the overall anxiety levels in American society will be explored, as well as whether it has gone too far, and the possibility that other forms of marketing might be more effective.
- - In exploiting fear, products and services are developed to meet existing fears, create new fears, and take advantage of new fears as they surface. -The strategy of using fear to sell products has been around centuries. It began to emerge in the late 19th century as merchants travelled around the country in horse-drawn wagons , shouting outrageous claims about their products and selling their goods to naïve townspeople. -In the 1920s, the Listerine company advanced this practice further by using the fear of humiliation to market their antiseptic. This wildly effective campaign put it in consumers heads that bad breath would cause them to be shunned by society, and boosted annual sales of Listerine from $115,000 to over $8 million in just 7 years. -Companies have capitalized on world events by selling safety and protection from fear, whether selling bomb shelters during the cold war, or Hummers after the September 11th terror attacks. -New products were also introduced to placate consumer fears, such as hand sanitizer in response to the SARs outbreak in Asia and bottled water over concerns about contaminated public water. -The fear appeal is currently one of the most widely-used strategies in marketing, along with humor, rational, sex, and bandwagon appeals.
- -This is a 19th century ad for Hunt’s remedy that shows how this magic tonic can fight off death, one of the infamous Listerine ads that shows how bad breath will make someone a social pariah, and a ridiculous ad for hand sanitizer declaring that man’s best friend is actually his worst nightmare.
- -Using fear to sell products allows companies to develop marketing strategies that feed off current events and the media -Fear causes a physical response that releases adrenaline which raises the fight or flight instinct. -This leads to a psychological response where the brain tries to reason and respond logically to remove the cause of fear. – -This results in the formation of a connection between the advertised product and a feeling of safety and security, which can lead to a strong brand recognition and loyalty. Fear appeals have been proven to be a stronger motivator than even touting the features of the product being sold DISADVANTAGES -Fear has to be used at the correct level or it can come on too strong and cross the line between being effective and being too disturbing. -If ads are not placed correctly they can miss the target market entirely. As is the case with public health ads that target specific economic groups and may alienate them by appearing condescending. -If the scenarios or messages presented are hard-to-believe or absurd, credibility issues can develop.
- -The first ad shows how the use of fear can go too far with an ad that is so repulsive it’s difficult to look at and, and in my opinion fails at effectively communicating the message. The goal of the second ad is to convey that everyone, including Wonder Woman, is susceptible to the AIDS epidemic, but it’s so ridiculous that it too fails.
- -Shockvertising, as it’s referred to, is a tactic where disturbing images are presented to grab and keep a viewer’s attention. -It’s especially effective in health marketing. The CDC’s “Tips from Former Smokers: campaign in 2012 resulted in 50,000 smokers quitting after running for just 6 weeks. -The images presented are often extremely graphic, such as in the “faces of meth“ ads that show before and after pictures of users to illustrate the ravages of the drug’s use. -Ads lose effectiveness if they’re too disturbing, viewers will just look away. SCARCITY -Goal is to create a feeling of limited availability to prompt consumers to act quickly or risk missing out. -It creates an inflated perceived value for the goods being sold -The messages usually stress that both time is running out and that quantities are limited. -It’s the fear of scarcity that made eBay so successful.
- -The first ad is for a rehab facility that shows the horrors of meth addiction . The goal is for the graphic images to keep the viewers’ attention long enough for them to read the captions. The thought is that the more shocking the image, the longer lasting the memory the ad will create. -The second shows a black Friday ad stressing that consumers better hurry in now for huge savings before they miss out. These are often bait and switch ads where the items shown are in extremely limited quantities and the hope is that consumers are drawn to the store will purchase something else.
- -Guilt and shame are two appeals that work together, as feeling of guilt often lead to feelings of shame.. -The two are effective in online marketing, especially for items such as diet plans, supplements, and health club memberships. -Using the guilt and shame scales of the Test of Self-Conscious Affect 3, which measures emotional response to guilt and shame-causing questions, Such as “Did you overeat during the holidays?” or “Are you feeling lazy?”, can assist marketers with customizing online marketing for individual users. FEAR, UNCERTAINTY AND DOUBT -This strategy was created by the marketing division of IBM in the mid-1970s in an effort to thwart the efforts of competitors in the software industry. -Used to create fear, uncertainty, and doubt in competitors’ products to divert possible buyers away them. -Also used to create the fear of being left behind by buying inferior products -Recently been shown to be more effective when used positively, to create a message that benefits the consumer, rather than to negatively effect competitors.
- -These are two pretty strong guilt and shame inducing ads. The first, pretty absurd ad was run during world war II to get people to save gas to support the war effort. The second one shows the possible effects of drinking during pregnancy in extreme and cartoonish fashion.
- -Marketing using the fear for self-preservation preys on the primal human desire to stay alive and reproduce -While the reaction is generated by instinct, the human brain allows for a logical response to threatening situations instead of an unpredictable animal-like response. -Self-preservation ads tend to create lasting memories -Ads that create overly frightening scenarios can backfire due to consumers’ tendency to put up defense mechanisms -However, these ads are so effective because they call into question whether we live or die based on our decisions
- -The fist ad promotes gun ownership as a means of self preservation while the second shows the dire prospect of leaving a young child and family behind due to a heart attack and early death.
- -Especially effective at marketing health and hygiene products because they’re shown as a means to eliminate the cause of disgust -It relies heavily on the use of images to create mild feelings of repulsion that generate the fear response -The psychological response and memories caused by disgust tend to have a longer-lasting impact than ads that simply employ raw fear. -Caution needs to be used to not to come on too strong because the strong feelings of digust created can easily go overboard.
- -Here are two examples where the disgust fear appeal was used right. The Lamisil “Digger” was an anthropomorphic toenail fungus shown on commercials moving in under sufferers nails. The cartoonish aspect of Digger made it somewhat less disgusting that it could have been, and the fact that it was aimed directly at those suffering from toenail fungus made it a successful ad. -Similarly, the Mucinex mucus man is intended to represent something gross that we should want to rid ourselves of, but it was made with enough humor that it doesn’t gross people out completely.
- These are two examples when the disgust is brought on so strong that it’s physically repulsive and likely to make viewers cringe and turn away. The left one is a revolting ad promoting weight loss and the one on the right is an ad for hand sanitizer that is likely to make viewers’ skin crawl.
- --Psychologist John Watson set out to show how effective and long-lasting fear could be in altering human behavior. -In a highly unethical experiment, he used an 11 month old baby named “Little Albert” to show how fear could be conditioned into the human mind the same way a hunger response was conditioned into Pavlov’s dogs. -The baby was presented with a bunny, and several other fluffy white items, while a steel bar was struck to create a startling sound -Poor Little Albert did develop an extreme aversion to anything white and fluffy, including Santa’s beard, and Watson’s theory was confirmed, shortly before his termination from Johns Hopkins University due to the egregious experiment. MOBBS’ FEAR REACTION STUDY -Cambridge Neuroscientist Dean Mobbs designed an experiment using a video game and an MRI scanner. -Intent was to show how complex an emotion fear is and how it causes humans to react illogically and unpredictably. -Test subjects were scanned with an MRI while they played a fear-inducing video game. -Mobbs discovered that as fear increased, the subjects acted out uncontrollably, while the MRI showed brain activity moving from the frontal lobe to a deeper part of the brain called the periaqueductal gray, where primal brain activity occurs.
- -On the left we see poor Little Albert terrified by a fluffy bunny and on the right by John Watson wearing a Santa beard.
- -Clotaire Rapaille is a psychiatrist turned marketing consultant who believes that much can be learned about consumer buying behavior by understanding what he calls their “reptilian brain” -He believes the brain is broken into 3 parts, the reptilian brain, where instinctual behavior occurs, the limbic system, where emotions are generated, and the neocortex, where human intelligence resides. -Some cultures, like American, are far more reptilian and reactionary than others, like the Germans. -Through teaching languages around the world he found that humans attach words to emotions, and this varies by culture. -His belief is that marketers need to be aware of these differences to customize strategies for different cultures -Due to American’s highly reactionary buying tendencies, using fear appeals is very effective, far more so than in less reptilian cultures.
- -Here is Rapaille and his three parts of the human brain. The brain stem and cerebellum are parts of the brain that Rapaille believes produce the reptilian impulses, while the limbic system is where emotions are generated, and the neocortex is where human intelligence is stored and logical reasoning takes place.
- -In the Thayer Model of Arousal, fear is used to instill interest in a product by deliberately creating tension in the individual. -The key with this model, is that tension applied in exactly the right amount actually creates a positive feeling in the individual that they will then subconsciously transfer to the product being marketed. -The problem is once the level of tension passes that point and positive feelings are replaced by anxiety, a negative association with the product is formed. -Finding the exact balance of tension is absolutely essential when using fear to market products.
- -The Thayer model shows four quadrants: Anxious, Exuberance, Contentment, and Depression. As the energy level and tension rises accompanied by the correct stressors, mood is raised from contentment to a positive, information-seeking level which is the ideal marketing point. However, if the energy is raised to far and the wrong type of stress is applied, the tension quickly turns to anxiety, and any desire for information-gathering shuts down.
- -GlaxoSmithKline had been searching for a way to launch their new product called Paxil into the SSRI (short for selective serotonin reuptake inhibitor) market to go against competitor EliLilly’s top-selling Prozac, which had already cornered the market for treating Major Depression. Too often in the pharmaceutical industry, instead of company creating drugs to treat an existing disease or disorder, they search for new ones for their existing drugs to treat. -Their researchers uncovered a little known about disorder with loosely defined symptoms known as General Anxiety Disorder. GAD became a catch-all for any form of anxiety that wasn’t already categorized. -They quickly received FDA approval and went on an extensive campaign to market Paxil as a pill to treat a general feeling of fear. -Their marketing team created a group called Freedom From Fear, to spread the news about GAD. Since they weren’t specifically discussing Paxil, Glaxo didn’t need to include their name on the hugely effective ads the group put out. Some of these ads included taglines like “Do you feel afraid all the time?” or “Many people spend 40 hours a week worrying, has anxiety become a full-time job for you?” -The vastly successful GAD marketing campaign made Paxil one of the top selling SSRIs through the late 1990s.
- 26
- -After witnessing the successes Glaxo achieved with marketing Paxil for GAD and SAD, drug-maker Pfizer quickly followed suit and researched the DSM for disorders that their own top SSRI Zoloft could be used to treat. -They uncovered a disorder formerly known as Shell-Shock, previously diagnosed almost exclusively in combat veterans returning from war, called Post Traumatic Stress Disorder. -As GlaxoSmithKline had done, Pfizer manipulated statistics and came up with some of their own to make as many people as possible believe that they suffered from this it. The causes they claimed could range in severity from losing a limb in military combat to a child losing a beloved pet. -According to their studies, 1 in 6 juveniles and 1 in 13 in the overall population suffered from PTSD -Sales of Zoloft soared in the wake of the 9/11 terror attacks and also as soldiers returned home from the subsequent war in the Middle East.
- This graph shows the success of both Paxil and Zoloft marketing campaigns in the late 90s/early 2000s.
- -Formerly known as the evil-sounding Syndrome X, it’s a precursor to heart disease, diabetes and a long list of ailment that began to emerge in the early 2000s. -Pharmaceutical companies were seeking to replicate the success of the cholesterol reduction craze that made statin drugs some of the top sellers in the industry. -The fear with Metabolic Syndrome is that obesity will lead to insulin resistance and diabetes, while high triglycerides and low good cholesterol, coupled with hypertension can lead to heart disease and early death. -It’s been a boon to pharmaceutical companies because it’s several health issues rolled into one, and a diagnosis of Metabolic Syndrome usually means the patient will require several medications, one for each individual component. -Critics of the pharmaceutical industry have questioned whether this truly is a major health crisis or just another “new venue for revenue”, revenues which has been quite lucrative as the drugs used to it have accounted for $13 billion in sales in 2013.
- -This graphic shows the symptoms that when grouped together make up Metabolic Syndrome.
- -The left shows the stock price of Johnson and Johnson, after Invokana, was released, On the left shows early sales for Lipitor, the top selling prescription in history, after its initial release.
- -Attention deficit disorder or ADD is the inability to remain attentive, to concentrate and effectively organize, marked by restlessness, irritability, aggression, and social detachment. -Marketing is aimed at parents and seeks to prey on the fear they have of children failing in school, not being able to enjoy things normally, and being rejected by other kids. -ADD is not exclusive to children and there has been a steep rise in adults being diagnosed with it. -The increase in the prevalence of ADD can be attributed to a two decade long campaign begun by Novartis, the makers of Ritalin, and later joined by Shire, producer of Adderall. -Drug makers market ADD as being a life long disorder that begins in childhood andif left untreated will lead to job failure, unemployment, and worse, later in life. -Major issues are that it is often diagnosed with minimal symptoms and the medications are stimulants that are often abused.
- -These ads show what successful treatment of ADD can supposedly lead to: good grades and no longer being a monter.
- -Frightening and unsettling public health ads are often given a pass because their goal is to achieve a greater good, a healthier overall society. -Ethical issues arise with how public health marketing targets the intended audience. For example, the percentage of smokers is much higher in low-income consumers, while the percentage of smokeless tobacco users is considerably higher in rural areas. In targeting just these individuals, public health agencies risk being perceived as condescending by making low income citizens appear ignorant and those in rural areas seem uneducated. -This is also a problem with ads promoting safe sex to prevent the spread of STDs and HIV. They need to get the message across in a way that doesn’t stigmatize those that have already contracted a disease so they’re more likely to seek treatment.
- -Shown are a CDC print ad from the Tips From Former Smokers campaign where it’s advised to be careful shaving so you don’t cut your stoma, and on the right an add illustrating the undesirable effect smoking can have on food.
- -While the US only makes up 4% of the total global population, it accounts for 31% of guns owned worldwide. -A major contributing factor to the number of gun owners is the unrealistic perception that crime is much worse than it actually is, known as the fear of crime. -Guns sales continue to climb as crime rates decline due largely to mass shootings and the government calling for stiffer gun control. -While the number of shootings has decreased significantly, the magnitude and bloodshed of the incidents has increased dramatically with shootings like those in San Bernadino where16 were killed, Roseburg, OR, where 10 died, and Charleston, SC where a gunman killed 9 at a bible study group. -Sales have risen due to this heightened anxiety, from 7 million in 2002 to 15 million in 2013
- This chart shows how gun sales have been affected by several world events over the last 15 years. The September 11th attacks led to a steep rise in sales, as did both of Obamas elections and the Sandy Hook shooting. The spike in December of 2015 was caused by calls for stricter gun laws as a result of the escalating number of mass shootings.
- -This chart shows the number and type of guns manufactured by year. As you can see, not only has the number of guns produced increased dramatically, but a higher percentage of the guns produced are pistols, which are used almost exclusively for personal protection.
- -Even as crime rates have continued to fall over the last 20 years, sales of home security systems have continued to rise. -In the US sales have increased 80% to $24 billion between 1996 and 2005 -This is largely due to an inaccurate perception that the world is more dangerous than it is, known as the fear of crime -Smart security systems, which allow users to monitor their homes with any internet-connected device, have almost doubled from $500 million in 2013 to nearly $1 billion in 2015. -Overall sales over home security systems in the US have climbed from more than $7 billion in 2006 to over $10.5 billion in 2012
- -Sales of SUVs picked up steam in the 1980s as high-end Jeep models became as status symbol among the wealthy, who justified driving the huge, gas-guzzling vehicles by saying they provided added safety and comfort. -They gained popularity among the middle class in the 1990s with more affordable models such as the Ford Explorer -The Hummer was released to appealed to those who wanted a rugged military vehicle -Sales of SUVs soared after the 9/11 terror attacks as families sought to keep safe as the threat of terrorism in the U.S. became a reality. -Continue to see high sales due to concerns for family safety and security, even though they have higher mortality rates in accidents than standard vehicle.
- -With the supply chain expanding as suppliers look for cheaper sources, coupled with an overwhelmed USDA, more and more tainted food is making it to stores resulting in a steep climb in the number of recalls. -Consumers have become increasingly aware of what they’re eating and are moving away from foods that contain chemicals, artificial flavors and colors, chemicals, preservatives and GMOs. According to a 2015 study, 35% of Americans describe themselves as being “ingredient sensitive”. -9 million Americans sick from contaminated food in 2013 alone costing U.S. health authorities $15.6 billion -This has created a boon for organic food producers who are supplying healthy food sections in major grocery stores. -While shoppers are seeking healthier options, they are turning away from traditional processed packaged foods which is negatively impacting producers like Campbells, Kraft and Kellogg’s who have been slow to adapt. A newly reduced study found that 100% of Campbells cans contain Biphenol A or BPA, which have been linked to cancer. -Target reports that 98% of its shoppers purchase natural or organic products with 50% growth in these categories in 2014. Major grocery retailer Kroger reports that its Simple Truth brand brought in $1.2 billion in sales in 2014.
- -This ad for organic food preys on consumers’ fear of eating chemically altered foods.
- -The number of incidents have increased greatly as more and more transactions are going electronic. -Security concerns such as the 40 million consumers exposed after the Target credit card system breach have greatly increased fear in consumers -Identity theft is the most frequent complaint filed with the FTC, accounting for 14%. -In 2013 alone, two millions complaints were filed for a total of $1.6 billion in identity theft-related fraud -Identity protection companies such as LifeLock, which saw $326 million in sales in 2013, and the much smaller Intersections Inc., which brought in $324 million, continue to see massive revenues as consumers live in fear of their identities being stolen.
- -Debt collectors use strong-arm techniques including incessant phone calls and letters that often threaten dire consequences if the debt isn’t satisfied immediately. -Some of the tactics they use involve making false claims of their power such as contacting employers to garnish wages, seizing assets and bank accounts, and even criminal prosecution and imprisonment. -It’s a boom-time for debt collectors as consumer credit and unscrupulous lending products like payday loans have soared -These collection actions actually serve as marketing for the debt relief services as debtors see them as saviors from the evil collectors. -While there are several legitimate non-profit credit counseling agencies, many are for profit, charge huge fees, and may not completely resolve the debt. In many cases they charge exorbitant fees for a totally unnecessary service, since debtors can simply contact their creditors to make payment arrangements themselves.
- -Receiving a letter stating that federal taxes were underpaid or never filed can be a harrowing experience. Due to the sheer size and magnitude of the IRS, contacting an agent to discuss it seems like an insurmountable task. -Unlike debt collectors, the IRS has ultimate power. They can garnish wages, seize assets, freeze bank accounts, and put offenders who fail to comply in prison -Complex tax codes can be daunting and confusing, making it hard to figure out where the error occurred. -Tax settlement firms purportedly have the ability to negotiate on the tax payers behalf to reduce or eliminate taxes due, and get the threatening letters to stop. -Many of these firms claim to have a staff full of tax resolution specialists but often overstate their expertise -Much like debt collection, tax payers pay stiff fees for an unnecessary service. They can request an installment agreement with the IRS themselves by simply filling out a form 9465. -Claims these companies make about being able to greatly reduce the amount owed are exaggerated. While the IRS can grant one-time abatements to erase unfair fees, it’s highly unlikely they’ll cut people a break on what they owe.
- -As the cost of living soars and with Social Security not being increased to keep pace, the greatest fear facing the elderly right now is running out of money in retirement. -Unscrupulous finance companies seeking to exploit this fear have begun to offer a product called a reverse mortgage -Primarily offered by no-name banks pitched by soft-spoken second tier celebrities. The goal of the ads is to express the financial security and comfort that a reverse mortgage can bring during financial dire straits -Eligibility requirements customized to target seniors with high home equity, must be over 62 with minimal liens on their home. -It’s essentially a home-equity loan, but the bank pays the borrower, either in a lump some or monthly payments, and is paid back either when the homeowner dies or when the property is sold -The are several drawbacks, such as reduced benefit eligibility, high closing costs and interest, and a diminished estate value. -For these reasons, it should only be considered as a last resort.
- -
- -The burst of the housing bubble left many homeowners owing far more on their mortgages than their over-valued homes were worth. -The fear for self-preservation left families terrified of being homeless and vulnerable -Predatory lenders, often posing as being affiliated with the federal government and offering assistance with Home Affordability Refinance Program, corral desperate homeowners into high or adjustable rate mortgages they can’t afford. -Many borrowers actually end up far worse after “no cost” refinances where huge closing costs are rolled into the total amount of the loan.
- -Not the most current data, but this chart illustrates how likely borrowers saved from foreclosure are to default on modified loans.
- -Would other methods be more effective? -The CDC looked into the recent success of anti-smoking ads run by the Ontario Health Ministry, that employed a much more positive approach than the CDC uses in their Tips From Former Smokers campaign. Instead of scaring smokers into quitting, they attempted to inject humor into their message to make it more appealing to a wider audience. Unfortunately, what works up there, doesn’t work down here. Going back to Rapaille’s “Reptilian Brain”, this may because Canadians are much less reactionary than we are here. In this first video, the CDC attempts to make convey a positive message in an anti-smoking message with the hope that smokers believe that quitting is possible, that there’s light at the end of the tunnel. -Unfortunately, while that ad has been somewhat successful according to consumer response, this next ad, has been dramatically more effective due to a hard-hitting example of “shockvertising” Does the fear used in marketing raise anxiety in society? Absolutely, whether you’re watching TV, surfing the internet, or just driving your car, you’re more than likely going to run into one form of fear-based marketing or another. Whatever your mood was prior to viewing the ad, marketers have worked long and hard to ensure that it raises a fear response and makes you want to purchase their safety providing products. Has the use of fear in marketing gone too far? Absolutely not. We live in a free market economy, and while many consumers are appalled and sickened by some of the ads being run, American companies are at liberty to use whatever means necessary to sell products. If people are so offended, they can protest and get them to change their methods by simply not purchasing their products. Especially in the examples I presented, there is no more effective appeal that can be used to get the marketing messages across than fear.