* Actually convince people of things, some of which will be unbelievable because there are plenty of incompetent evil regimes out there.
* Just spew enough bullshit that people give up trying to figure out what's right.
* Remind the population that of their power, as indicated here.
* Provide their followers with permission -- even if propaganda is not really believable, they are implicitly telling their own followers that they won't be punished for behaving as if it is true.
This is the "Donald Trump is actually playing infinitely complex 4-dimensional chess" line of thought.
Edit: to fight it, perhaps create a psychologically plausible excuse for why everyone fell for his shit? Give people an out.
I think nearly everyone has lied at some point, most consequentially. Who hasn't been taken by a lie, or repeated something they knew they couldn't verify? I'm pretty confident in my positions and outspoken about them but I don't always speak up when I ought, and I often speak up when I shouldn't.
There is no "timid segment of the population" there is only us. It's much more constructive to study the pressures, constraints, incentives, and conditions that lead individuals and groups into these actions.