Increasing activity and improving conversion (Part II)
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This is the second instalment looking into psychological studies and how we can use their conclusions to our benefit when trying to get users to click or convert when in the digital or physical space. You can find the first part here.
Some of the experiments mentioned are more controversial than others*. Either way the lessons learned are valid and have been in practice since inception.
Little Albert Experiment
The “Little Albert” experiment is pretty extreme in comparison to other experiments raised. It wouldn’t be allowed today, not only because of the nature of the experiment, but also because the participant was a nine-month old child at the time of the experiment. This work was conducted in 1920. It was widely reported that the child, known as Little Albert, never recovered from the effects of the experiment.
The work does teach us some fundamental lessons about how the human brain is set up. John B. Watson conducted this experiment to provide evidence for classical conditioning.
Classical conditioning is “the alteration in responding that occurs when two stimuli are regularly paired in close succession: the response originally given to the second stimulus comes to be given to the first.”
This study observed a child who Watson referred to as Albert B. and who is known today as “Little Albert.” Little Albert loved animals before this experiment — specifically a white rat.
Watson began to pair the presence of the rat as well as other animals with the loud bang of a hammer hitting metal. Eventually, Little Albert developed a fear of animals, including the white rat he originally loved. This was due to the negative association of the loud bang which was paired with each introduction of the animal. Although the two interactions were completely unrelated, their association was strong enough to elicit a negative response from Little Albert.
How can this be used?
In Little Albert’s case, the emotion associated with the presence of animals was fear and anxiety. As a result, he came to dislike animals.
Associating positive emotion with your brand, product or service can have the opposite effect, people can grow to love something. The emotion and feeling of being able to achieve your goals by using its products and services.
Nike (as well as others) has positioned itself as a brand that can and will help you achieve your goals. From Nike’s “Just do it” slogan to its strategic use of the underdog who becomes a hero. Nike has associated the positive emotion of achievement with itself and its products.
Make this positive association obvious. Repeat this messaging and association until an image is created in the mind of your users. You’ll soon notice a significant increase in responses to your messages.
Decoy Principle
A conversion optimisation experiment is known as the economist pricing experiment. Psychologist Dan Ariely popularised this experiment in his book, Predictably Irrational.
Ariely surveyed 100 of his students at the Massachusetts Institute of Technology and asked them to choose between the following three options:
- Web-only subscription ($59)
- Print-only subscription ($125)
- Print and web subscription ($125)
The results of the experiment were amazing out of the 100 people surveyed:
- 16 people chose the web-only subscription = $944
- 0 people chose the print-only subscription = $0
- 84 people chose the print and web subscription = $10,500
Totalling $11,444 worth of subscriptions
Ariely then removed the print-only subscription, which nobody chose, and gave another group of 100 students the following options:
- Web-only subscription ($59)
- Print and web subscription ($125)
The findings were surprising:
- 68 people chose the web-only option = $4012
- 32 people the print and web option = $4000
Totalling $8012 worth of subscriptions
The shift in subscription choice takes a huge swing. All because of the option which was never expected to sell but presents the more costly subscription to be a better choice.
You can use the decoy principle to boost sales by introducing an appealing offer that costs less and has more features. This way, people will feel that they are getting a bargain and will be compelled to act immediately.
When people see that package A has twice the features of package B, yet both cost the same, they will instantly develop a preference for package A.
Another example of decoy pricing is used by many retailers, including Apple products:
By putting the 32 and 128 GB iPhone models side by side and pricing them so closely, some users will feel compelled to select the 128GB model without considering that competing products might be superior and cost less. Instead, they will focus on the fact that they are getting the 128GB at a much better price. It’s quadruple the storage of the 32GB version at only £100 more. With those three models marked at those price points, and all with apparently similar features, the 128 GB model looks like the bargain!
As you can see, adding one or more purchasing options can boost conversion.
However, this example also demonstrates something more fundamental about the brand image, and is raised continuously by consumers that aren’t fans of Apple products. Why will many people easily hand over their money for a product from one brand, yet be reluctant to pay a fraction of that amount for a similar competing product?
Context is Key to Boosting the Perceived Value of your Product
People were asked how much they were willing to pay for beer. The first group were told that the beer would be purchased from a local shop, while the second group was told that the beer would be purchased from a fancy boutique beer shop. The study revealed that people offered to pay more for the very same beer when it came from the fancy boutique beer shop.
Mastering the art of conveying exclusivity through context can dramatically boost conversions. The grander or better people consider your product, service or brand to be, they will pay for your product, even if it is worth much less.
For example, you are more likely to pay a premium for a television like the ones shown above if you see it on a curated e-commerce website with a higher perceived brand. John Lewis lists one television for £2,799.00, whereas Amazon’s search results display the same television ranging starting from £2,499.00.
Some brands and companies believe that offering discounts or competing on price is not a smart long-term approach to business. Create a premium impression/experience and you will command premium rates. That being said, it’s not always about what you’re offering. Simple brand positioning and marketing can go a long way to improving your conversions.
In conclusion
We have now spoken about a few techniques that could help improve your customers click and conversion rate, there are still many more.
People are complex and users behaviour will definitely change over time, what works today may not work tomorrow. Constant evaluation and testing is required when understanding what best converts your customers.
Read more about the studies and experiments here:
Little Albert by John B. Watson
Decoy Principle by Dan Ariely
Context Study by Richard Thaler
*Since some of these experiments were conducted, the ethics code for human subject testing has changed dramatically. More information can be found on the American Psychological Association site, which documents global human research protections. http://www.apa.org/research/responsible/human/
