APPLICATION OF COGNITIVE PSYCHOLOGY BY BUSINESS LEADERS: COGNITION CONTEXT

“Great leaders don’t lead others with bitterness or resentfulness of past mistakes, they lead with hope and knowledge of the past to inform greater decision-making in the future.” ― Spencer Fraseur, The Irrational Mind: How To Fight Back Against The Hidden Forces That Affect Our Decision Making.

Introduction

Cognitive psychology is the scientific study of mental processes such as attention, memory, perception, and problem-solving. By understanding these processes, businesses can create products and experiences that are more appealing and effective. In fact, several businesses and business leaders use cognitive psychology to build better workspaces, design preferable products, and foster healthy behavior to strengthen the workplace bond.

According to a study by McKinsey & Company, companies that put a strong emphasis on employee well-being are 25% more likely to outperform their peers in terms of productivity and have a lower turnover rate. The influence of cognitive psychology can be seen in various aspects of businesses such as employee training and support, motivation, and retention. Psychologists specializing in cognitive psychology conduct scientific research to increase productivity, identify training needs, and implement policies that attract and retain the best employees. Cognitive psychology is a driving force that helps businesses develop new strategies and game plans.

Business Leaders Using Cognitive Psychology

Here are some businesses that use insights from cognitive psychology in their operations:

Amazon – According to a study by Nielsen Norman Group, 59% of website visitors prefer to skim read rather than reading word-for-word. The design of Amazon’s website is user-friendly and encourages customers to make purchases. The use of eye-catching images and clear product descriptions grabs customer attention and influences their purchasing decisions.

Google – A survey conducted by Statista found that in 2020, Google processed over 92% of all internet searches worldwide. The design of Google’s search engine is intentionally created to make it easy for users to find the information they’re looking for. For example, it uses algorithms to predict what a user is searching for based on their previous search history and displays relevant results first.

Nike – According to a study by Brandwatch, Nike is the most popular athletic brand on social media, with over 124 million followers across all platforms. Nike’s marketing campaigns create a strong emotional connection with customers. Its “Just Do It” slogan inspires customers to take action and pursue their goals, while its ads featuring professional athletes appeal to customers’ aspirations and sense of identity.

Starbucks – According to a survey by Statista, as of 2021, Starbucks had over 33,000 stores worldwide. Starbucks uses cognitive psychology in the design of its stores and menu to create a sense of comfort and familiarity for customers. Its stores are designed to feel welcoming, with comfortable seating and a warm atmosphere, while its menu offers a range of options to suit different tastes and preferences.

Apple – According to a study by Statista, in 2020, Apple had a market capitalization of over $2 trillion. Apple uses the principles of cognitive psychology to create a sense of anticipation and excitement around its product launches. They also use the principle of “perceived value” by charging premium prices for their products to create the perception that their products are high-quality.

Coca-Cola – According to a study by Statista, Coca-Cola’s global revenue amounted to over $33 billion in 2020. Coca-Cola creates a positive emotional connection with their brand by using bright colors, catchy music, and heartwarming stories in their advertisements to evoke positive emotions and create a strong association between their brand and happy memories.

McDonald’s – McDonald’s uses cognitive psychology to create a sense of familiarity and comfort with their brand. They use consistent branding, familiar menu items, and bright colors and logos to create a sense of comfort and ease with their fast-food offerings.

Airbnb – Airbnb creates a sense of trust and reliability among their customers using cognitive psychology. Airbnb highlights reviews and ratings by previous guests as social proof, and they also use the principle of anchoring to create a sense of value by showing prices in comparison to other accommodations in the area.

Spotify – Spotify uses cognitive psychology to create personalized music recommendations for their users. They use algorithms and machine learning to analyze a user’s listening habits and preferences to create tailored playlists and suggestions that cater to their individual tastes and interests.

Uber – Uber creates a sense of ease and convenience with their ride-sharing platform. They use principles of human-computer interaction, such as providing real-time updates on the status of a ride and providing multiple payment options.

In conclusion, the application of cognitive psychology by business leaders can lead to better decision making, increased productivity, and the creation of more appealing products and experiences. The examples of companies mentioned in this article demonstrate the effectiveness of using cognitive psychology in various aspects of business operations. As a reader, it is important to understand the role of cognitive psychology in business and to use this knowledge to improve your own decision making and problem solving skills. By incorporating these principles into your business strategies, you can achieve greater success and growth.