Image source: 42courses.com
Understanding human behaviour.
The default setting of a product may create a better or worse habit for your users. Nudging people with a message may increase their spendings. Or sometimes, creating an ambient environment may influence what you buy in a store. There are several principles that we interact with on a daily basis, which might help us design better products. Or not.
Limit the number to increase the amount bought
When there are a limited or scarce resource and high demand, people are more willing to pay excessive amounts for the product or service. And the perceived fear of missing out on something is particularly motivating as we are loss-averse too. What this means is that we find losses roughly twice as painful as gains are pleasurable.
One experiment tested the power of limiting the number of soup cans that a person could buy. When a limit was set, the amount of cans customers purchased went up. On average by 70% from their usual 2 or 3 cans.
The suggestion that something is in scarce supply makes us want it more.
Also, a great example here is Adidas with their NMD shoe collection. The company being on a decline for some time, a couple of years ago they decided to launch a new, now very successful, shoe collection called NMD. Besides the fact that the design was cool, they sold only a limited amount of shoes for each collection launch (10k of pair if not mistaken). So if you were one of those people who wanted to buy the shoes, they were sold in less than 24 hours.
Context may influence your behaviour
Sensory Priming is about how our behaviour can be influenced by each of our 5 senses (sight, sound, smell, taste and touch). An experiment in the UK tested playing music from different countries in a wine shop. The research found that French wine easily outsold German wine when French music was playing and vice-versa. Only 2% of customers interviewed afterwards even mentioned the music;
A similar thing happened to me. It was at Sephora in Amsterdam, and they were presenting a new collection of skin care and perfumes for men (inspired from Japanese culture). And they added decorations to the room in a Japanese style. And created an entirely new environment only for the collection. The music, the ambience, the smell. And in the end, I bought those items…
Remove the symbol to reduce the “pain”
Only thinking about spending money can make you experience a kind of physical pain. If you were to be put into a brain scanner right now and we played a game where you lost your money, the part of the brain that would light up is the same part that feels physical pain.
Studies have shown that by removing the currency symbol ($) or the currency word (dollars) from menus, average spending can increase by 12%. This is because people who see only the numerical value, are less concerned about the price of what they are ordering.
The same thing applies to paying with credit cards. Only the fact that we don’t see losing money (paying for something) makes the act of paying less painful and stressful. Which leads us to our next cognitive principle — loss aversion.
We hate losing stuff
Loss aversion refers to people’s tendency to prefer avoiding losses to acquiring equal gains. “It is better to not lose $5 than to find $5.” What distinguishes loss aversion from risk aversion? The utility of a monetary payoff depends on what was before experienced. Or was expected to happen. Some studies have suggested that losses are twice as powerful, psychologically, as gains.
We are by nature loss averse. We hate losing stuff — no matter if it is money or simple points. An interesting experiment of gamification was applied and implemented in Italy for drivers.
As a car driver, you receive a certain amount of points (20). And every time you violate a traffic rule, for example ignoring the traffic light, you lose points (in this case 6). This psycholgical trick decreases the chances that you will do it again. And due to its effectiveness, many countries applied this demerit point system (more info).
Note: Some countries do it vice-versa. They give you points for violating a traffic rule. And giving instead of taking will skyrocket a terrible behaviour. There’s evidence that drivers were boasting between themselves on who had the most points for breaking the law. Giving points for bad behaviour means encouraging it.
Increasing commitment with friends
I see this common mistakes in fitness apps. People think and believe that why people don’t stick with a plan or don’t finish one is because the workout is a problem. Or that you need some motivating music in the background to keep you encouraged. Or a new type of training or a library of quadrillion workouts that nobody will ever do or watch. But the problem lies in commitment.
The problem is not in the training program, reps, how often, but whether are we socially committed to something. Whenever you train with a fitness trainer or with a friend, the chances that you will go to the gym and finish a training program increases by 90%. Think about that when you try to create a movement or community around your product. And the answer may be in the fact that we should do it with a friend.
The power of a default option
As humans, we like to go with the flow of a default setting. Whether you buy a new phone and don’t change the basic settings or shop in a supermarket. Thinking is an effort (which all should practice), so when we’re recommended an option, we’ll often take the path of least resistance for our brain.
When the default size of the various types of stuff we use change, so do our actions and behaviour. For example, when supermarkets double the size of trolleys, people buy 40% more. The default portion sizes in cookery books since the 1930s have increased every decade, and so have the proportions of many people.
We tend to choose the middle option
When given a range of options from high to low people tend to go for the middle option. This is known as The Goldilocks Effect. In a study at a McDonald’s outlet, people were asked to choose between a range of different drink size options. Regardless of the size options offered, 80% of them always chose the median size option. This happens because we assume the middle option is the typical option. We will always go with the option that requires less effort to think about. And which is most bought or chosen (social proof).