August 7, 2023
Have you ever heard the phrase, “You are the company you keep?” It has good and bad ramifications, doesn’t it? It’s often applied to young people and their friends. But did you know this “Halo Effect” influences customers as well? And you could be using it in your business for amazing results.
What Is the Halo Effect?
The Halo Effect is not a fancy marketing trend. It’s based on science and psychology. According to Wikipedia, “The Halo Effect is the tendency for positive impressions of a person, company, country, brand, or product in one area to positively or negatively influence one's opinion or feelings in other areas.” It’s this phenomenon that explains influencers’ impact on driving purchases. But if you can’t afford a celebrity spokesperson or big-name influencer, you can still use the power of the Halo Effect.
How to Use the Halo Effect in Your Business
Applying the Halo Effect can help you associate your goods or services with the positive feelings your target audience has for another brand, person, place, etc. For instance, think about how some stores use employee suggestions.
The Company You Keep
A bookstore might create a display that features one of their employee’s designated “favorites” featuring two best sellers and a new book by an unknown author. People who enjoy the two best sellers will associate the positive feelings about those books with the one in the middle even if they know nothing about it. On the other hand, if the bookseller displays the book by the newbie author on its own, readers are more apt to pass it by and not take a chance on it.
A similar experiment was referenced on a blog post on HubSpot. In the article, the author shared his experience in creating marketing materials for his podcast. He tried one image with just his podcast logo, showed it to a group, and asked them if they were interested in listening to it. He recorded their responses. Then he tested another group’s response using an image of his podcast’s logo surrounded by popular podcasts. With the second image, respondents were 3x more likely to agree to listen to the podcast.
Figureheads
The Halo Effect can also be applied to a non-famous spokesperson or mascot. Why do so many schools use a mascot that is considered tough, strong, or hard to beat? It’s because of the Halo Effect; the thoughts about that mascot are (at least initially) applied to how someone perceives the team.
Look also at how Bartles & Jaymes Wine Coolers used those two trustworthy, no-nonsense guys on the porch or how Subway employed ordinary guy Jared (before the scandal, of course) to carry on their marketing message, shaping their brand and influencing purchasers to buy. Customers’ cognitive bias on seeing two older men on a porch reminded many people of their grandfathers and immediately instilled trust. Jared represented the ordinary guy. No one saw him as a paid actor. He was so familiar and like the rest of us. Thus he sold a lot of footlongs.
Organizations with Good Reputations
To use the Halo Effect in your business you don’t need an expensive marketing budget. You can also align yourself with groups that have stellar reputations in your area. The chamber of commerce, for instance, is an organization with a strong reputation for expertise in business and community involvement. When you position your logo next to theirs at your brick-and-mortar location, on your website, or as a sponsor for one of their events, the positive impression community members have of the chamber will be passed along to your business as well.
The Halo Effect is one of the most cost-effective ways to associate your brand with the type of organization, person, or feeling that best represents who you want to be.