The Psychology of Sales

The Psychology of Sales

It’s that time of the year where we’re spending all of our Christmas money on new clothes, furniture, and in some cases, Christmas presents for next year. Every store is clearing out its stock with huge sales, and prices are slashed to a fraction of what they were before Christmas.

Companies will see millions of pounds in revenue, and millions of happy people will walk away with a great bargain. But there is more to sales than deals and discounts.

Why Do We Love Sales?

There is a wealth of data out there dedicated to unearthing why consumers far and wide are so attracted to discounts and deals.

One study discovered that when customers find a significant discount, they experience feelings of excitement. Customers also feel smart, lucky, and accomplished when they find a bargain, and discounts can influence them to try a new product or brand that they may have previously been on the fence about.

Additional research confirmed that discounts and coupons make people feel happier and much more relaxed, with just a £10 coupon increasing oxytocin levels by 38%. This study also found that those who received a better deal were 11% happier than those who did not.

In short, sales make people happy. They can dissuade people from shopping around for a better deal and encourage repeat customers. But how do brands do this?

Framing Matters

When items are on sale, they will often be priced in one of two ways: a percentage discount or a money off discount. The presentation of sale prices affects how consumers view them and whether they think they are getting a good deal. This is sometimes known as the Rule of 100, developed by marketing professor Jonah Berger.

According to his research:

  • Percentage discounts work best for items under £100. 20% off sounds better than telling a customer how much money is discounted from an item, despite being the same amount.
  • Money off discounts work best for items over £100. Seeing how much money is discounted from a more expensive item influences consumers more than a percentage discount does. For example, $100 off a $500 item looks better than seeing 20% off.

The Rule of 100 works due to a psychological concept known as framing. Seeing a percentage off a lower priced item looks like more money than it is. Higher priced items such as furniture benefit from having a large chunk of money knocked off so that consumers see what a great deal they’re getting.

Scarcity and Urgency

Sales do a great job of scaring us into taking action. They play on our fear of missing out (FOMO). They create deadlines for when the deal will end and make consumers think that once it’s gone, it’s gone forever.

This is where scarcity and urgency mindsets come in. Sales can play on our FOMO to encourage consumers to buy more for these two reasons:

  • Scarcity – If stock is touted as limited, customers will be more likely to buy it.
  • Urgency – When deals and discounts are limited to a specific timeframe, customers will want to take advantage before it runs out and the product returns to full price.

Utilising FOMO can boost sales massively. Limit the sale to a weekend or event, such as a New Year event that clears out your old inventory.

Experiment With Design

Sales aren’t just about the pricing and the products – they are also about the design. Even small changes can make all the difference, such as how large your font is.

Research has found that using a smaller font for sale prices makes customers feel like they’re paying less for the product. When combined with larger text displaying the discount, consumers feel they’ve found the best deal.

A/B testing can help you to identify what your consumers look for in a sale. Create two variations of your page, one with a slightly smaller font displaying your sales price and one with a slightly bigger font, and compare how well they do. 

Simple changes like this can improve your conversion rates massively. Although these changes might seem small, A/B testing can help identify where you can improve your website or content to enhance your page and put you a cut above your competitors.


Sales are a glorious amalgamation of psychological tricks and design practices. By instilling a sense of urgency and framing prices in specific ways, sales can seem like life-or-death events that encourage us to buy now and think later.

Though sales are a great way to move old stock or boost sales for a product or service, they can also encourage new customers to give you a try and to order more from your company. Discounts and bargains are great incentives to motivate potential customers into making a leap and trying something new.

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