Did you know that classical music in liquor stores encourages customers to buy more expensive bottles? It may seem crazy, but customer psychology is a goldmine that opens up such and many other opportunities for businesses. So in this article, we’ll tell you about the main psychological factors that shape consumer behavior through the online shopping experience.
But why does it work so well? We like to think that we are in control of our thoughts and that we make rational decisions. More often than not, however, our behavior is influenced by details we are not even aware of.
Customer psychology is even more important when it comes to e-commerce because business owners have more control over customer touchpoints.
By understanding these factors, you can use them to your advantage and achieve significant results!
Customers psychology for online business: 5 basic principles
1. The principle of reciprocity
Imagine this: you go into a store just to look around, and a salesperson comes up to you. He starts to show you products and give you information about the brand. A relationship develops between you and you start to think about spending some money. You end up buying a lot of stuff even though it wasn’t necessary.
This has probably happened to everyone at some point in their lives-no wonder we panic when salespeople approach us in stores. This social phenomenon is called the principle of reciprocity. The logic is simple: when someone does something nice for us, we feel the need to return the favor.
And businesses have been taking advantage of this for years. Think of all the free cheese you’ve tasted in stores and the shampoo samples that have been piling up in your drawer. But how do you implement the same logic in the online world?
We do it all the time. You may have already heard of this concept: Content marketing.
But there’s an important point here that many companies overlook. When you provide something for free-it could be an e-book, an online course, or customer support-don’t do so with the sole purpose of getting something in return.
That’s because that intention is usually picked up by customers and backfires. According to a Nielsen Norman Group study, users often enter fictitious information when confronted with overly aggressive forms of customer engagement before the site has gained credibility.
In another study on the same issue, a group of users was asked to fill out a form to gain access to a set of free recommendations. On the other hand, another group of users was first given a guide and then asked to fill out a form. The results showed that while the first group was more likely to fill out the form, the second group provided more information.
The important thing to understand here is that a visitor who voluntarily provides their contact information is more valuable than one who does it because they are forced to. If you’re asking your visitors to do something for you before they get a chance to interact with your brand, you’re off to a bad start.
The advice here is simple: give before you take. Even if it’s something simple, customers will appreciate it. And while not everyone will immediately switch sides because you offered a free benefit, they will develop a more favorable attitude toward your brand.
2. The principle of scarcity
There’s only one left in stock, but a few spots are still available, last day of discounting! Suddenly, the question of whether you need the product/service is no longer an issue. You just feel the urge to start running and have time to buy everything you can before it runs out.
This psychological principle of persuasion, coined by Dr. Robert Cialdini, means that the rarer or harder it is to get a product, offer, or piece of content, the more valuable it becomes.
To demonstrate how this principle works, an experiment was conducted. Participants were shown two different product descriptions: “Exclusive limited edition. Hurry, supplies are limited” or “New Edition. Many items in stock.” Participants were then asked how much they would be willing to pay for the product. The average consumer was willing to pay an extra 50% for an item with the first description!
And another interesting point related to this principle.
Although both limited quantity and limited time encourage customers to buy, a limited quantity is more effective because it creates a sense of competition between consumers.
There are many ways in which Internet companies cleverly use this principle and increase sales. For example, booking.com shows messages like “Booked x times today” or “x other people are also looking right now” to create a sense of scarcity.
But again, if you overdo it or give false information, it won’t work because it loses its legitimacy. So be strategic and honest about your scarcity messages instead of mindlessly throwing them around.
3. Center stage effect
When you put a product in the center, people tend to think it’s related to its popularity and superiority. As a consequence, shoppers are more likely to favor products that are centered, whether on a storefront or an e-commerce site.
Even more interesting, research has shown that the center-point effect is stronger when people buy products for others. The idea that a product is placed there in the center because of its popularity makes it an ideal gift option in the minds of consumers.
Keep in mind, however, that the center stage effect works if all of the items in the “lineup” are similar. So try to arrange items from the same category in one line, and then place the one that you would like to highlight the most in the center.
This effect is so powerful that online marketplaces like Amazon and eBay can charge more money for brands or products that want to be placed in the center of their storefronts.
So you, too, can take advantage of this strategy and promote a new product or more expensive item by placing it in the center of your product line.
4. The tendency to avoid doubt
No one likes to make unreasonable decisions-so when faced with a questionable situation, we tend to make a quick decisions to avoid uncertainty. This is especially true when it comes to online shopping, where you don’t have the opportunity to see or touch the product in real life.
Therefore, it’s very important to eliminate any kind of uncertainty that a shopper might have when they visit your e-commerce site. One very important way for e-commerce businesses to do this is to provide high-quality and detailed product photos.
According to Splashlight research:
nearly half of online consumers in the U.S. rate high-quality product images as the most influential factor in making a purchase decision, and over 50% want to see at least 3-5 product photos – front, back, and side – before making a purchase. This is why it’s always a good idea for e-commerce businesses to invest in product photos.
Social proof is another effective way to reduce uncertainty. Social proof is showing that other people have already made a choice or used a product/service, such as reviews, testimonials, or social shares – thus encouraging others to do so.
This is another psychological effect based on the principle that people are more likely to do something if they are presented with evidence that others have done it too. And it’s safe to assume that it’s effective for e-commerce, given that 88% of consumers trust user reviews as much as they trust personal recommendations. So be sure to encourage your customers to leave reviews about their experience.
Finally, it’s a good idea to include messages like “Reliability over 98%” or “Customer Favorite” next to product displays to promote them more effectively. You can even come up with strategic headlines, such as “Perfect Valentine’s Day Gift,” and give customers more reasons to buy for certain occasions.
5. The zero price effect
I think everyone would agree that the difference between 2 and 1 is greater than the difference between 1 and 0 – certainly when it comes to pricing. There’s just something magical about getting free stuff that can hook anyone.
According to the zero-price effect, our brains perceive free options more positively than those we have to pay for. But you don’t have to give away free products to take advantage of this effect. Even if there is a free benefit associated with a product, we still perceive it more positively despite its cost.
One popular way for e-commerce sites to do this is through free shipping. According to a recent NRF report, 75% of consumers surveyed expect shipping to be free, even for orders under $50. And that percentage continues to rise in a pandemic world dominated by e-commerce.
On the other hand, “contingency spending” is the main reason people abandon shopping carts because it essentially has the opposite effect of the zero-price effect. It also undermines customer confidence in your brand and provokes abandonment doubts. So if you need to charge extra, the best way to handle it is, to be frank, and open about it.
Also, feel free to emphasize your free incentives. You can even amplify the zero-price effect by showing customers how much they get for free by emphasizing the difference between the original price and the new price.
0