The Psychology of Consumer Behavior: 4 Important Consumer Tectonic Shifts

(With Michael Solomon)

The Psychology of Consumer Behavior: 4 Important Consumer Tectonic Shifts

Michael Solomon is one of the world’s leading experts on consumer behavior. He is the author of Consumer Behavior: Buying, Having, and Being, which is the most widely used book on the subject in the world. His newest book is The New Chameleons: How to Connect with Consumers who Defy Categorization. He also advises global clients on marketing strategies to make them more consumer-centric. 

Michael is a contributor at Forbes, and he’s frequently quoted in publications such as New York Times, The Washington Post, Time, USA Today, and Adweek. He is also a professor of marketing at the business school at St. Joseph’s University. 

In today’s episode, we’re going to discuss the psychology of consumer behavior and the marketing strategies Michael uses to gain customer loyalty. 


Michael has a Ph.D. in social psychology and through his observations, he found that consumers are constantly changing. 

In grad school, Michael did a lot of research on how physical attractiveness and a person’s look influence what happens to them in their lives. This led him to realize that a big part of our social identity is formed by the services and products we buy. He started looking into the fashion industry and did a lot of work on the psychology of fashion. He found that everyday products fundamentally influence who we are.

Over the years, he had the opportunity to work with many companies on how to understand their customers, and he has written numerous textbooks and a few trade books on understanding consumer behavior. His biggest home run was writing a textbook that is used around the world and has changed the way we teach consumer behavior. 

In his most recent book, The New Chameleons: How to Connect with Consumers who Defy Categorization, he compares customers to chameleons. Since consumers’ identities are influenced by the products and services they buy, they are often changing. 

“Unlike the old days where things were a lot more static and we just dealt with mass markets [and] really large groups of homogeneous people, today, everybody is much more of an individual,” Michael said. “Just as a chameleon changes its color as it moves into different environments, many of us today are doing something similar with our identities. We try on new identities. We try on new lifestyles.”

Michael explained we often alter our identities when we surf the web or look at someone’s Instagram page. We are influenced by the people we see around us and tend to change our needs or wants very frequently. This means we have to be very careful about categorizing our consumers. Since they are always changing, we should constantly reevaluate our target audience and research what our customers’ needs and wants are. 

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4 Tectonic Shifts

If customers are constantly changing, how can we effectively build a business strategy to connect with our customers? Michael shared four customer tectonic shifts we should be aware of if we want to build relationships with our customers. 

1. The End of Artificial Dichotomy

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When I asked Michael to share one of the biggest tectonic shifts happening today, he told me it is the end of the artificial dichotomy. The artificial dichotomy is when we assign individuals to a category based on an arbitrary criterion. 

The old categories we used to describe our customers don’t make much sense anymore since society is changing so rapidly. Before, we could use basic categories such as rich vs poor or male vs female, but those have become too broad. 

One of the biggest mistakes we can make as marketers is falling prey to the fallacy that if we assign a name to something, we understand it. We tend to think we can place our customers into categories such as “women in their 20s who live in urban areas,” and then understand all of them. 

“Don’t assume that you know all your customers and certainly don’t assume that just because you’ve put them all into a certain segment that they’re all going to react identically,” Michael said. 

Even if we narrow down our customers into a niche group, we still can’t assume we know everything about them. As we said above, consumers are constantly changing and so we should reevaluate our categories quite often. Even with extremely niche categories, we often make the mistake of projecting who we want our customers to be, rather than who they actually are. One of the biggest mistakes we can make is marketing to the customer we want to have rather than the customer we actually have. 

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2. The Role of the Customer

Customers are beginning to take over a lot of the roles in our businesses. 

Many companies fall into the trap of spending an incredible amount of time and resources on a product to get it to the point where they believe it is perfect. Once it’s “perfect,” they launch it with their fingers crossed, hoping it goes well. However, this method includes a lot of risks. If their customers don’t like their product, they just wasted months of work and have to start all over again. 

Instead of doing this, companies are beginning to give customers a role in their product development. Companies will launch a product right away, get feedback from their customers, and then make adjustments based on their comments.  

“Customers are taking over a lot of the functions or at least helping with a lot of the functions that used to be only on one side of that fence so to speak. For example, our customers are content creators. Our customers are advertisers. . . . Our customers are becoming product designers,” Michael said. 

SiteGround, a popular web host provider, is a great example of a company that prioritizes customer feedback. Their brand has three different channels customers can leave feedback at. They listen to their customers and make adjustments based on their ideas (Source: 

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Starbucks is a great example of companies using customer content. They promote their brand with #RedCupContest every December. They encourage their customers to submit a photo of their coffees for a chance to win a gift card, and then they use those photos as part of their marketing strategy (Source: Business2Community). Even BMW uses hashtags to share social media posts created by their customers. 

“Customers and also our employees, are our two biggest underutilized assets,” Michael said. “Many companies are figuring out that it doesn’t make sense to keep the consumer at a distance, but rather you want to embrace that consumer and involve them in the process, and you get some great insights as well. Consumers who are more proactively involved in this process are more engaged with the products and services that allow them in.”

3. The Horizontal Revolution

Instead of communicating customer to business (vertical), there has been a shift of communicating customer to customer. Michael calls this the horizontal revolution. 

In the early days of the internet, a lot of communication was one way. Businesses created ads and websites that told customers how good their products or services were. However, now communication is all about interactivity. How do we have a conversation with our customers? Nearly every website we go on has the option for reviews and comments. We also have social media platforms where customers can interact with each other. We can communicate peer to peer. 

“Word of mouth is really what determines whether people are going to buy a product or avoid it, and so we not only have that up and down communication that we had 10 years ago, but we have that horizontal communication which means that so much of our daily lives are spent networking with our peers,” Michael said. 

This is one reason why influencer marketing is becoming such a prominent tectonic shift. An influencer’s opinion is considered in a similar way to a friend’s. Since they don’t work for the company, consumers believe their information to be truthful and accurate. It also makes the consumer’s job easier. Instead of filtering through all of the information on the internet themselves, they can listen to what their peers have to say. 

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4. Content Marketing

One of Michael’s best monetization strategies is focusing on content marketing. 

“The real bonds that people are forming with companies or with individuals are because those people are putting out great content that attracts these people. You’re not, so to speak, putting a gun to someone’s head just to sign up for your email newsletter, you’re creating content that’s so good they want to be a part of whatever it is you’re doing,” Michael said. 

By creating and offering valuable content that resonates with our audience, we don’t necessarily need to sell anything to them right away. If the content is valuable, it will give our customers a path back to us. It also provides credibility for us and nurtures a relationship with them. Content marketing encourages customers to come back to us when they’re ready to make a purchase decision.

Key Takeaways

Thank you so much Michael for sharing your stories and knowledge with us today. Here are some of my key takeaways from this episode:

1. Consumers are constantly changing.

2. The old categories we used to describe our customers don’t make as much sense anymore since society is changing so rapidly.

3. Don’t assume that customers within a specific category will behave the same. 

4. Customers are taking over a lot of the functions in our businesses. 

5. Customers trust peer reviews over advertisements or self-promotion. 

6. By providing valuable content to our customers, we pave a path for customers to come back to us when they’re ready to make a purchase decision.

Connect with Michael

If you enjoyed this interview and want to learn more about Michael or connect with him, you can find him on his LinkedIn or his website,  

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    About the author

    Nathan Gwilliam

    Nathan Gwilliam

    I help organizations navigate tectonic shifts that are transforming the business landscape, so they can optimize marketing, accelerate profits, and make a greater difference for good.

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