Scientists from the University of Aix-Marseille conducted an interesting study and identified several tactics of manipulation used by sales teams of online trading firms.
This study applies to binary option and forex online trading brokers. It based testimony on real clients of online trading companies, communication materials such as emails, online chats, phone calls and ads uncovered by the AMF.
According to the study, one of the most common manipulation tactics called “reciprocity rule”.
'Most of these tactics tap into social norms and conventions, which make people easily susceptible to suggestions. For instance, people that receive a gift feel obliged to repay somehow – that is why, offering them a bonus makes them feel obliged to the broker. This is an example of abuse of the so-called “reciprocity rule”.'
Speaking of bonuses worth noting that some regulators already banned it, so if your broker suggests you bonuses it can be a good reason to question the legal side of it.
Another sneaky manipulation tactic used by brokers is “foot in the door”. This tactic implies asking some small investment and then some bigger investment.
'One client was first asked to invest EUR 250 and, after a couple of days, was contacted again to add extra EUR 450.'
Another interesting marketing trick used by brokers is football sponsorships and advertising using sports legends. Scientists called it “attractiveness of the source”.
'This is an ancient trick known as “argumentum ad hominem” – if an expert says it, then it must be true…. AMF stresses that sports partnerships that seek to advertise high-risk financial products are prohibited under the Sapin 2 law.'
In general, we can say that these tactics can be used not only by online trading companies. These tactics are very popular and used by marketers pretty often. But it is another reminder that we must always be alert.
You should not make decisions based just on advertising. Just take into account reputation of the broker and your own capabilities.
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