As of January 2021, there are 1.8 million active websites on the Internet, with 1.8 billion in total existence!
With such an overwhelming number of websites, catching attention, generating interest and retaining customers is becoming more and more difficult.
That said, there is a secret weapon to cut through those 1.8 million sites. That secret weapon is the relatively untapped realm of digital psychology...
What is digital psychology?
Psychology isn’t a new phenomenon. Psychologists, behavioural scientists and neurologists have spent centuries picking apart the human brain to discover how our minds function and what makes us tick.
Digital psychology, however, is a pretty new concept, in the grand scheme of things. It combines digital marketing with behavioural economics and psychology to uncover how people behave, specifically online.
The role of digital psychology
We live in a world full of numbers and statistics. Tools like Google Analytics make it easier than ever to track WHAT your customers are doing. However, digital psychology unearths WHY they are doing it.
Ultimately, digital psychology strives to give an explanation as to why your customers behave the way that they do. It aims to identify how you can create a form of online communication that is persuasive to the unconscious mind.
Basically, how you can optimise your customer journey to make it more engaging, persuasive and actionable!
Digital psychology helps optimise digital marketing strategies where raw numbers can’t. This deeper level of understanding lends itself to multiple fields within the online world.
Digital psychology’s role in the digital marketing landscape is a strategic vision piece. It isn’t a tactic in itself. It’s a way of thinking that can be applied across the digital marketing mix at a strategic level.
All marketing efforts should account for consumer psychology principles in the planning phase.
Why is digital psychology important?
Digital psychologists look at the way Internet users browse search engines. They consider how much content website visitors consume, how they interact with information and when they purchase products/services. This helps businesses like yours to better position themselves in the digital ecosystem.
Marketers are constantly seeking to engage and influence buyer behaviours. What better way than knowing exactly what buyers want and how to deliver it to them?
To achieve this, it’s essential for marketers to understand the psychological factors that influence consumers’ decisions. This has been widely studied in-store to discover how marketing methods help brands engage with their buyers. But, the online world is still a few steps behind.
Whilst we could argue that face-to-face interactions are more influential, there are tactics we can use online to be just as persuasive, if not more! In some ways, influencing online decisions leads to a better customer experience.
Picture this: you visit a car dealership for a casual browse. After 30 seconds, you get approached by a pushy salesman with his brash attitude and pushy lines.
We’ve all been there.
And 9 times out of 10 it’s a turn OFF. Hard sales tactics are a thing of the past.
Priming, prepping and persuading are key. Essentially, actions that help buyers make decisions.
Encouraging customers to make their ‘own’ decisions in their ‘own’ time (i.e. assisting your customer in making your preferred choice), is far more effective than ramming sales spiel down their necks.
A good marketer understands the consumer's emotions and uses these to form a bond between the consumer and your product/service. To understand the buyer's emotions, you need to find out the psychology behind their behaviour. This will make it much easier to come up with a marketing strategy that will bring the desired results.
By understanding consumer psychology, marketers can predict and influence consumers’ behaviour through their digital marketing strategies. Pair consumer psychology with digital marketing and there you have it; digital psychology. The pot of gold at the end of the rainbow!
Digital psychology can help marketers:
- Understand why their customer buys products/services online
- Increase conversion rates
- Reduce bounce rates
- Increase average spend per transaction
- Retain current customers
- Increase repeat purchasing
- Apply testing methodologies
Digital psychology and cognitive biases
Often, consumer behaviour and decision making are based on heuristics. These are subconscious decisions your mind makes without consulting the rational, logical part of your brain (the conscious mind).
Heuristics are mental shortcuts that we rely upon to save time and effort because they avoid thinking through the next course(s) of action.
Heuristics have formed over millions of years as humans have evolved. Although they often make day-to-day decision making much easier, they can also lead to errors of judgement.
We can become reliant on heuristics which can lead us to make rash, emotion-led decisions or express irrational behaviour. These errors of judgement are known as cognitive biases and are hardwired into our brains.
Savvy marketers know that tapping into these cognitive biases can have huge gains in the digital marketing industry.
5 areas of digital marketing psychology
Multiple types of consumer psychology tactics exist - there are well over 100 cognitive biases. We want to take a look at a select few that have proven to be particularly effective...
It’s important to combine multiple psychology principles into your marketing to achieve your goals.
1. Scarcity as a psychological tactic
If you’re not familiar with this psychological tactic, you must have been living under a rock for the last decade! Scarcity creates urgency which in turn increases consumers’ desire to buy so as not to miss out on an opportunity.
Scarcity is particularly effective for ecommerce businesses where products can be presented as ‘low in stock’ or ‘in high demand’.
However, service-led businesses can also take advantage of the scarcity tactic. For example, they can implement short-term discounts or limited appointment slots for consultations.
Research shows 4 main ways that the power of scarcity was used:
- In Short Supply: ‘only 1 room left’ ‘only 10 in stock’ ‘limited supply’ increase urgency to buy before stocks deplete
- For a Limited Time: ‘24 hour flash sale’ increases urgency to buy before the end of the time period
- High Demand: ‘1,437 sold today’ - emphasises popularity and increases the likelihood of buying
- Unique Opportunity: ‘members only’ ‘unique discount code’ ‘VIP access’ - make individuals feel privileged to have such an offer presented to them
Booking.com is a genius when it comes to scarcity...
‘Only 1 left on our site’ creates an incredible sense of urgency. It also positions the company as credible, trustworthy, reputable, reliable and popular - hitting that human need for social proof!
2. The decoy effect in digital marketing
This cognitive bias forms the foundations of many pricing models. As the term ‘decoy’ suggests, it is a lure or a trick to encourage customers to make a guided decision. Sneaky!
The decoy effect refers to the introduction of a third price point to make one of two others appear more attractive.
Take a look at monday.com’s pricing below. If only a Basic or Pro subscription existed, a customer may struggle to justify paying double for the top tier membership.
Enter the Standard subscription.
This falls somewhere between the two, usually closer in cost to the lowest price point. Suddenly the Pro subscription seems like a great option. It’s just £5 more than the middle tier, as opposed to double the cost of the lowest. It immediately feels like great value, especially considering the additional features you get for just an extra fiver!
This 3 price-pointing model is an incredibly effective digital psychology strategy. It actually has the power to encourage customers to choose the exact option you always wanted them to go for.
3. Loss aversion in digital psychology
Loss aversion bias refers to our human tendency to prefer avoiding losses to acquiring equivalent gains. In other words, the fear of losing far outweighs the pleasure of winning.
Think about it: losing £100k would hurt much more than the joy of receiving £100k.
You can harness this psychological phenomenon in the way you position your product or service. For example, many SaaS companies offer free trials as a way of priming a new customer (think of Monday.com or HubSpot).
The free trial requires very little commitment from the consumer with nothing to lose, or so they think...
The loss comes when their free trial is over! During the course of their free trial they will have built a subconscious emotional connection. Not emotional in the sense of attaching ourselves to another human being, but emotional in terms of reliance and dependency.
Their everyday lives may have become a little less stressful. Their everyday tasks may have become a little more efficient. All thanks to the software or platform.
The consumer is happy to pay for access because it avoids the much bigger loss associated with no longer being able to use the software/platform.
SaaS marketers know that free trials are the best hook for long-term subscription commitments. This is because once a potential customer becomes an actual customer, there’s also upgrade opportunities within the platform.
Ecommerce stores with tangible products can also take advantage of this cognitive bias. One of our favourite brands of 2020 does exactly this...
A fragrance-buying experience like never before! Get free samples straight to your door, alongside the full-size perfumes.
Don’t like the sample? Send the big bottle back. Like the sample? Keep the big bottle and pay for it.
The digital psychology associated with this? The loss of the big bottle.
Once it’s in the clasp of your palm it becomes so much more difficult to return. A great tactic!
The also the element of effort - it takes far more effort to return the item than to simply keep it, even if you're not the biggest fan.
4. Reciprocity as a psychological technique
Giving and receiving. It’s a natural balance of human life. When we receive something for free, we feel indebted to that person or organisation, meaning we want to give something back.
We experience reciprocity in our everyday lives.
For example, have you ever invited someone to a party just because they invited you to theirs? Ever bought a Christmas gift for someone because they bought one for you? It's a sense of obligation to do something for someone when they’ve done something for you.
In a consumer society, this is a powerful tool. Giving away freebies builds relationships and loyalty, ultimately priming the recipient for becoming a paying customer.
It’s not only effective in the acquisition of new customers, it can also facilitate longer-lasting relationships with existing customers. Reciprocity is a fantastic way to build brand loyalty and advocacy.
Consider these 5 core pillars:
- Make customers feel special and unique - bring a personal touch to correspondence and outreach
- Give customers a gift of value that benefits their lives - don’t give away pointless stuff, target your customers’ pain points
- Suggest ways that customers may reciprocate - a donation, a discounted purchase, a trial
- Be the first to give - don’t wait for an enquiry for more information, provide a free download
- Don’t let the circle end - keep giving until they convert! A prime opportunity for email marketing
5. Social proof in digital psychology
One final, sure-fire way of using digital psychology is showing social proof of your product or service. Studies show 92% of online consumers read at least one product review prior to making a purchase, with the majority of shoppers reading between 1 and 6 reviews before committing to a decision.
We humans like to follow the crowd! A few positive reviews of a product or service makes us far more inclined to try it for ourselves.
There are a number of ways you can showcase social proof:
- Customer reviews
- Total subscribers
- Total number of social shares
- Success stories by your customers
- Third-party certifications
- Security badges
- Client logos
A fantastic tool to pull through social media, Google review and purchase proof widgets is Elfsight - this handy little tool displays details like 'last purchased' or 'Rob just booked a call' that encourage other visitors to take the same action.
Video testimonials are amongst the most powerful tactics. Why not ask a client to use a simple tool like Loom to record a short video of why they'd recommend your product or service. All they have to do is share a link and you ca do the rest - it removes friction and delivers powerful content.
A great example of a company who uses reviews as social proof is Amazon. The majority of product listings have reviews into 3, 4 and 5 figures to scan through before making a purchase decision.
Digital psychology and customer experience
The ultimate goal of any marketing tactic is to offer an unparalleled customer experience that extends the customer lifecycle.
Using those principles mentioned above will subconsciously target your customers’ minds, without being overt or explicit about them. Remember the pushy sales guy we’re trying NOT to be like!
When combined effectively, digital psychology principles can assist in optimising conversions.