Note: We’re expanding the topics we’re covering on AdEspresso. From now on you can expect us talking not only about Facebook ads but also discuss other topics you are hugely interested in.
The first of them is conversion rate optimization.
And to kick it off we decided to look at some traits of human behavior to see how they affect our buying choices and how to use this knowledge in improving conversions.
Like decision making, for instance.
Because, you know, turns out we’re not that great at making decisions after all.
Here, let me show you how we REALLY decide in various situations:
We often skip making a decision if we can stick with the default option
I’m sure you’ve seen similar checkboxes on many checkout forms:
But how many times did you actually tick it (or even paid any attention to it at all)?
My guess is never.
And if that’s the case, you’ve acted like the majority of buyers to whom deciding on what to do with the checkbox requires too much effort.
Most of us simply choose the simplest solution – to ignore and leave it set to the default option.
But now imagine what happens if the same checkbox would be labelled only slightly differently:
(Disclaimer: this is a Photoshopped version of the original checkout.)
Now leaving it on the default would actually sign you up for the mailing list. And you probably wouldn’t even know about it until the company had emailed you.
Dan Ariely speaks at length about this behavior in this (fantastic, by the way) TEDtalk:
Watch it to see more examples of how this behavior works in our brains.
We’re also easily suggested
I bet you think you make decisions by analyzing all available information and selecting the option that seems best for us.
In reality though, most of our decisions are influenced by external factors in one way or another.
Because, you see, we’re easily suggested.
In 1903, Walter Dil Scott, one of the first psychologists to become interested in advertising wrote:
“Man has been called the reasoning animal but he could with greater truthfulness be called the creature of suggestion. He is reasonable, but he is to a greater extent suggestible.” (source)
Quite often even something as simple as a suggestion from a person we perceive an authority can get us to change our mind, even at a last minute.
Just take a look at these examples:
- You enrolled to a different course at a last minute because a friend you hold in high regard recommended it.
- You bought clothes only because you saw that some celebrity wears it,
- You signed up for software because an industry influencer had recommended it,
- Or implemented a strategy you discovered on a highly popular blog and so on.
The most important aspect of this behavior is how we establish a person’s authority.
According to Robert Cialdini we use various cues to identify whether a person has an authority over us or not. In his book, Influence Cialdini states some of the most common cues:
- Impressive job title,
- Expensive clothes or other luxury possessions,
- Uniform or other universally perceived symbols of authority etc.
Online these cues could include social signals and follower numbers, popularity of the content, association with other authoritative figures, testimonials, reviews etc.
And because of these cues we’re willing to act based on the person’s instructions.
Many experiments, like the infamous Milgram experiment have proved that we are willing to go beyond what we’re normally comfortable with. This particular test proved that we’re willing to obey authoritative figures even if what they tell us to do conflicts with our morals.
Here’s a great overview of the experiment:
Promotions not only affect our immediate buying choices but also, subsequent product selection
Apparently promotions or offers you show at the start of the customer journey affect their subsequent product choices during the trip, even if they don’t relate to products on offer.
According to this paper by Cathy Y. Chen and Shi Zhang:
“[…] store promotions may influence the decision-making process of a subsequent product choice through promotion-induced affect.”
What’s more, our decision-making process is affected differently depending on whether we were presented with a certain (i.e. $50 off a $200 item) or uncertain (i.e. 30% off a $200 item) promotion.
When the choice is simple, uncertain promotions have a much greater effect on our subsequent product choices. With a high involvement decision however, certain promotions will affect us better.
Offers can also get us to change our mind
I’m sure like most people you have preferred brands you always buy certain products from.
And I’m also certain that you’d consider your brand loyalty firm and unbreakable.
But the truth is, you’re almost bound to make a different choice if presented with an irresistible offer.
Here’s what this 2013 study by Shalini Srivastava revealed about our brand loyalty:
“The respondents have deep brand loyalty for various product categories and hardly switch brand choices except in cases of irresistible sales offers.”
But what makes the offer good enough to get us to change our mind?
Based on my experience, the three prerequisites for an irresistible offer are:
- Its reward is easy to understand.
- It alleviates pain or satisfies a deep desire.
- Its value outweighs the actual cost
Lastly, the more information we have, the poorer choices we make
Imagine that you stayed at home one night to prepare that super important presentation for the next day. And the next day you discovered that you missed a great party your friends had organized at a last minute.
And you know what, chances are that if you’d known about the party, you’d skip working on the presentation, even if that option provides more long-term benefits.
You see, according to a study conducted at the University of Austin, Texas, having more information about your options often clouds your judgment and makes you make poorer choices, especially in relation to long-term outcomes.
A research conducted by Kahneman and Tversky discovered a similar behavioral trait:
We tend to pay attention to what is going on now but don’t worry about the future.
Let me illustrate this with one example from this article summing up the research:
“If I offer you half a box of chocolates in a year’s time, or a whole box in a year and a day, you’ll probably choose to wait the extra day.
But if I offer you half a box of chocolates right now, or a whole box of chocolates tomorrow, you will most likely take half a box of chocolates now. It’s the same difference, but waiting an extra day in a year’s time seems insignificant. Waiting a day now seems impossible when faced with the immediate promise of chocolate.”
Like it or not, that’s us – poor at making decisions and trying to avoid it at any cost.
And these traits of our behavior you target when trying to improve conversions. Funny, huh?
Well, we’re going to help as much as we can. Expect at least one CRO focused post from us a month.
And if you have any questions or suggestions for future topics, leave them in the comments.