By James Cummings
Conversion rate is a big talking point in the e-commerce niche, and for good reason. All your efforts, including design and marketing, come down to having a customer click the “checkout” and complete payment. The greater the number of people that quit midway through the customer journey the more pressing the need to implement conversion improvement strategies. Unfortunately, more than 70% of companies do not know why 68.61% of customers abandon their shopping cart.
This piece takes a look at psychological angles you may have neglected in your businesses process and why you should get to know them right away.
Use of Decoy Pricing
Have you heard of the economist pricing? Psychologist Dan Ariely put this to test by giving his students two subscription options: Print Only ($59) and Print and Web ($125). Nearly 70% of students chose the cheaper option. However, when a decoy third option of Print Only subscription ($125) was introduced to take the choices to three, 84% of students went with the Print and Web ($125) subscription with the mindset that they are getting a bargain.
E-commerce business owners can deploy this technique to great effect. Introduce a decoy price that will trigger the feelings of getting a bargain in your target audience and you could easily ship off a good number of your harder to sell products alongside your top selling products.
Leverage on familiarity
When people are introduced to a marketing message for the first time, they tend to ignore it or exhibit scepticism (read hostility). With regular exposure to different messages from the same business, their disposition towards the business and their marketing takes a softer turn. This is the technique that has been used by effective email marketers for years. The more times you reach your audience through different means, the higher your chances of conversion. “This method is boosted by branding that is readily recognisable,” says Brendan Wilde at FreeParking.co.nz. “From your domain name to your social media handles, people should be able to quickly deduce what your business is about before they have read your marketing message”.
Cut down on choices
This classic study from 2000 shows that too many choices can reduce conversion by up to 900%. There hasn’t been any modern research to back up or disprove this but the effect is far too heavy to ignore. You should therefore carefully tweak the number of choices you provide your audience with and keep tabs on the impact on conversions.
Condition your customers
You can see it everywhere, from Apple and Mercedes to Waitrose and Walmart. Apple products are associated with luxury and high value. Waitrose and other similar stores like Walmart are associated with cheap. You need to find an association for your brand and consistently communicate it in your marketing messages. This psychological approach tends to have a longer-term effect as it is usually geared towards growing a loyal followership. However, it should also be part of your conversion improvement strategy.
Leverage on authority influence
There is a reason why brands partner with popular celebrities in their marketing messages. Some of these celebrities generate a great deal of positive affect and feelings of trust in large numbers of people, and, thus, them endorsing a brand goes a long way in creating a positive image through association. Additionally, there is always the possibility of taking the marketing message to their loyal followership, sometimes numbering millions across various social platforms.
This approach also applies to non-celebrities who are popular voices in their niche. This is why many cosmetic lines and electronic and gadgets businesses seek out Vloggers and bloggers, already respected in the niche, to do reviews of their products. The more authoritative and recognised, the higher the influence. This can translate to higher conversion gain for your business.
Highlight Social Proof
Testimonials are still as powerful as ever. Show them off in strategic parts of your website. Think about including video proof. Away from your website, use your social media pages to respond to reviews from satisfied customers. Throw in discounts “for their next purchase”. As other members of your target audience see the social proof, doubts about your brand are eliminated thus driving conversions up.
Leverage on deadlines
When it comes to getting potential customers to buy, time limited offers can be highly effective. The fear of missing out can drive customers faster towards making a purchase. This can also be complemented by decent price markdowns. Scarcity fuels demand and it is demand that turns into sales. Therefore, utilise deadline for your products. With deadlines, people are encouraged to make a decision now.
Diffuse the fear of commitment
When people are about to make a commitment to a product, one of the things they are worried about is losing money. This is why “Money Back Guarantees” tend to work fairly well. However, some consumers are already immune to such guarantees so consider other angles, such as offering 2 or more products for the price of one and throwing in some “extras”. When you want to go with the “money back guarantee” option, make it 100% and make sure there is an address the consumer can physically go to. This brings confidence. When the fear of commitment is no longer there, the chance of conversion is higher.
Understanding how psychology affects consumer behaviour and leveraging on it is vital to ensuring success in e-commerce. It’s not about tricking people. It’s about working with the way our social minds work to communicate your message to people in the most powerful way possible.