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Freudian Motivation Theory


The Freudian Motivation Theory is a psychological concept that attempts to explain human behavior by focusing on subconscious drivers. It is derived from Sigmund Freud’s work and believes that human decisions, especially consumer behaviors, are heavily influenced by hidden desires and experiences from their past. In finance, this theory is often applied to understand consumer purchasing behavior, advertising effectiveness, and market trends.


The phonetic pronunciation would be: Froi-dee-an Moh-tuh-vey-shun Thee-uh-ree

Key Takeaways

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  1. Freudian Motivation Theory asserts that human behaviors are driven by unconscious desires, particularly by sex and aggression. This suggests that our actions may be influenced by elements that we are unaware of, which can often span back to our childhood experiences.
  2. According to the theory, human personality and behaviour are shaped by the interaction of three components – Id, Ego, and Superego. The ‘Id’ is instinctive and is associated with basic needs and desires, the ‘Ego’ deals with reality and mediates between the desires of the ‘Id’ and the ‘Superego’ that represents the moral standards and values.
  3. Freudian theory has made a significant impact on psychology and psychoanalysis, providing a new way of understanding human behavior and motivations. It has contributed to the development of new therapeutic techniques such as psychoanalysis, dream interpretation, and free association. However, it is also controversial due to its emphasis on unconscious motives and sexual and aggressive drives.



The Freudian Motivation Theory is a significant concept in business and finance because it helps companies understand consumer behavior from a psychological perspective. This theory, developed by Sigmund Freud, suggests that people’s purchasing decisions are driven by subconscious factors or hidden desires and motivations, including basic needs, fear, and love, among others. By applying this theory, marketers and advertisers can design more effective strategies to motivate consumers to purchase their goods and services. Additionally, managers can use this understanding of human motivation to cultivate more productive work environments, promote more effective teamwork, and reduce potential conflicts. Hence, the Freudian Motivation Theory provides crucial insights into the undercurrents of human behavior that directly influence market trends and business operations.


The Freudian Motivation Theory is commonly applied in business and financial spaces to better understand consumer behavior, predominantly the underlying desires and motivations behind purchasing decisions. This theory ascertains that human behaviors are rooted in unconscious motivations, and it inherently drives consumers towards specific products or services. Sigmund Freud, the founder of psychoanalysis, believed that people are greatly motivated by unconscious needs and desires, including fundamental drives associated with love, power, and survival. These factors, according to Freud, play a critical role in shaping our behavior including consumption tendencies and brand preferences.Such insight into consumer behavior garnered from Freudian Motivation Theory can be harnessed to inform marketing strategies, product development, and pricing structure within the business world. By understanding the unconscious motivations of their target audience, businesses can tailor their offerings and brand message to address these deep-seated needs and desires. Moreover, it helps in advertising and promotional tactics, where unconscious cues can be incorporated to attract and retain customers. Consequently, Freudian Motivation Theory offers a more nuanced understanding of consumer behavior beyond surface-level observations, thereby enabling businesses to meet their financial goals and obtain a competitive edge in the marketplace.


1. Advertising: One of the most prevalent examples of Freudian Motivation Theory in the real world is in the domain of advertising and marketing. Advertisers often play on the unconscious desires and needs of consumers to drive them towards purchasing their product or service. For example, a car company may showcase their latest model zooming along a picturesque seaside or through a bustling cityscape. While the advertisement is ostensibly about the car’s features, it taps into deeper human desires for freedom, autonomy, power, and status – primal instincts according to Freudian theory.2. Sales Techniques: Salespeople are often trained to appeal to the subconscious wants and fears of their customers. A real estate agent, for instance, might speak subtly about the prestige and envy of owning a large house (appealing to ego and status), or the security and warmth of a family home (appealing to the id’s need for security and belonging). These psychological triggers are based on the fundamental Freudian drivers – the id, ego, and superego.3. Corporate Culture: Freudian Motivation Theory also applies to how businesses manage and motivate their teams. Managers may use knowledge of unconscious desires to cultivate a workplace environment that meets these underlying needs. For example, creating a friendly, supportive team culture can cater to an employee’s innate need for acceptance and belonging (superego), or setting competitive sales targets to satisfy an individual’s desire for achievement and recognition (ego). Providing generous compensation packages and benefits could be seen as satisfying more fundamental survival and comfort needs (id).

Frequently Asked Questions(FAQ)

What is Freudian Motivation Theory?

Freudian Motivation Theory posits that unconscious psychological forces, such as hidden desires and motives, play a role in human behavior. This is a theory developed by Sigmund Freud, which has been applied to the business world.

How is Freudian Motivation Theory used in a business context?

In business, Freudian Motivation Theory is often applied in the field of marketing where it proposes that consumer buying decisions are influenced by their unconscious minds. This idea helps marketers create strategies that appeal to consumers’ deep, hidden desires and needs.

What are the key components of Freudian Motivation Theory?

Freudian Motivation Theory revolves around three key components: the id (primitive instincts), the ego (what is acceptable in reality), and the superego (morality and ethics). These components shape our behaviors and motivations, including our consumption patterns.

How is Freudian Theory different from other motivation theories?

While many motivation theories focus on rational, conscious processes, Freudian Theory emphasizes the role of our unconscious mind. Therefore, it suggests that people may not always understand their own motivations, as these can be influenced by hidden desires.

What are some criticisms of Freudian Motivation Theory?

Some critics argue that Freudian Motivation Theory is overly focused on the unconscious, neglecting the role of conscious decision-making. Additionally, it is criticized for its gender bias and lack of empirical evidence. However, despite these criticisms, its impact on understanding human behavior and motivation is profound.

Can Freudian Motivation Theory be applied to all types of businesses?

While the application can be more prevalent in businesses that directly interact with consumers like retail or marketing, the theory might not be as relevant for other types of businesses. However, understanding the underlying motivations of employees or stakeholders could potentially be beneficial in many business contexts.

Related Finance Terms

  • Consumer Psychology
  • Unconscious Desire
  • Pleasure Principle
  • Personality Elements: Id, Ego, and Superego
  • Psychodynamic Approach

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