Conversion Optimization

15 scientific strategies to increase your eCommerce conversion rate (Updated for 2022)

Focus on understanding your customers' psychology and you'll sell like a dream.

15 scientific strategies to increase your eCommerce conversion rate (Updated for 2022)

Ok, you've probably been reading a lot of articles around how to increase your eCommerce conversion rate, so we are not going to bore you with details that you already know.

Instead, in this blog, we've compiled a list of 10 scientific strategies — based on human psychology — that you can apply to increase your conversion rate. Sounds good? Let's dive in.

The average conversion rate for eCommerce: 1.3%.

But there are successful eCommerce businesses hitting a 2x-5x rise above the average.

The best part? It's not rocket science.

We just have to ditch the older tactics.

Instead: Focus on understanding your customers' psychology and you'll sell like a dream.

15 Science-based Strategies to Increase your eCommerce Conversion Rate

1. Offer unbiased information (Prägnanz Law)

Humans inherently crave simplicity.

Research has found that the human mind deconstructs complex and ambiguous images into simpler forms to understand and act on them — this is known as the Law of Prägnanz or Pithiness.

Most high-converting eCommerce websites simplify their messages and offer unbiased information to their website visitors — this helps reinforce customer trust.

Customers buy based on trust. In a recent study, 81% of consumers said they’ll buy from brands they trust.

This is a principle often used by eCommerce websites to increase their conversion rate.

PetMeds is a good example of this. They are an online retailer of prescription and non-prescription pet medication and nutritional supplements. The company received 2.17 million website visits in December — an indication of its high conversion.

PetMeds uses clear, concise, and easy to understand messages on its website homepage.

Example of clear headlines on homepage

The company publishes its shipping rates and makes it easily accessible to visitors — there’s no hidden information.

It uses FAQs to provide clear guidance to its audience.

Example of FAQs on homepage

Why it works

  • Customers love websites that are easily understandable, clutter-free, and without distractions.
  • People trust businesses that are honest and transparent about their offerings.
  • Buyers shop with confidence when they know they’ll get an answer to their questions.
  • 84% of consumers expect brands to create helpful articles.

Quick guide on how to apply it

  • Offer your potential buyers unbiased information they can trust.
  • Be honest about who shouldn’t use your product.
  • Create content that makes your audience feel you’re solving their problems.
  • Make your website message simple, easily understandable, and clear.

Caveat

Your homepage should communicate to visitors who you are, what you do, and your value proposition within 10 seconds — and properly guide them on the action you expect them to take.

Don’t sacrifice your core message in the name of simplicity. Find a balance.

2. Give before you take (Reciprocity Principle)

Customers become more receptive when they feel indebted to a brand.

It’s always easier to give after receiving — this is because receiving creates a feeling of indebtedness. Savvy brands leverage this principle to make their prospects feel indebted to them and more open for a sales conversation.

Most of the booming eCommerce websites give something of value to prospective buyers before selling to them — this could be in the form of discounts, free eBooks, or anything of value.

The reciprocity principle helps boost conversions. 29% of online shoppers will complete a purchase they didn’t originally intend to if it has a heavy discount.

Here's how famous businesses use this principle to boost their retail conversion rate. Let's take the example of Harry's.

Harry’s deals in men’s grooming and shaving supplies. The website received 1.52 million visits and close to 50% were returning visits — a sign of a high customer LTV.

The company offers buyers two weeks trials at a fair price, with free delivery and a cancellation option. The trial sets allow buyers to test the products for two weeks before upgrading.

Example of trial offer to increase eCommerce conversion rate

Harry’s offers a membership program that gives buyers a 10% discount on all products, free engraving on all engravable Harry’s-branded products, and free expedited shipping on all orders above $45.

Why it works

  • Gifts can connect people emotionally to brands and help set up meaningful relationships between them.
  • 88% of consumers use coupon codes in the US. Statista estimates that the number of users will reach 145.3 million in 2021.
  • Heavy discounts can encourage shoppers to buy more than they intend.
  • Retailers that published coupons on their eCommerce stores see 26% higher average order values from their customers that use them.
  • Free shipping makes 79% of US consumers more likely to shop online.

Quick guide on how to apply it

  • Give discounts and coupon codes to buyers.
  • Offer free shipping.
  • Capture contact information with free offers.
  • Give free consultation.
  • Offer free product samples or trials.
  • Send a free product catalog (plus samples).
  • Offer valuable free eBooks, PDFs, guides — or other knowledge-based resources.

Caveat

Understanding the perfect gift for each stage of the buyer’s journey is what makes this principle powerful.

Offering a discount or free shipping to prospects at the awareness stage is a waste of time—in this case, free and valuable resources like eBooks, PDF, Checklists or Guides will suffice.

3. Don't hesitate to take (the Ben Franklin Effect)

Most retailers believe doing something for their customers is going to boost their goodwill. However, sometimes asking for a favor can also do the same thing. 

This is what the Ben Franklin effect is all about. Named after the well-known Benjamin Franklin, this concept states that if you ask someone for help and they do, chances are that they’ll be open to doing more favors for you. 

This doesn’t negate the Reciprocity Principle we discussed in point 2. It most definitely works. However, often it’s easier to ask for a favor than offer one. 

The psychology behind this: It’s a thought process that deals with cognitive dissonance i.e. a difference between an act and the motivation to do it. 

In this case, here are the mental processes at play when you ask someone for a favor: 

  • When you request a favor, they do it for some reason
  • Their mind tries to justify the act
  • It tries to align their impression of you based on the action they took
  • Finally, it creates a favorable impression of you because of the act of favor

Studies reveal the Ben Franklin effect to steer a 24% higher positive response among those performing the favor. 

In the eCommerce world, this translates into what retailers know as micro-conversions. This means asking for small favors from your customers and building onto that to request big ones later. 

Many brands already use the Ben Franklin effect successfully. One of the famous campaigns using this concept was Lay’s Do Us a Flavor campaign—which earned it a 12% hike in sales. 

Example of Ben Franklin effect in Lay’s campaign

Target does this too and it uses its copy effectively to appeal to customers. See the phrase help other guests and how it makes the task look easy with just a few steps.

Example of Ben Franklin effect by Target

Why it works

  • Humans look at justifying their actions and avoiding cognitive dissonance
  • We usually have a positive impression about people who we do favors for

Quick guide on how to apply it 

  • The best way to go forward is by asking for simple favors at first. You can request favors at multiple interaction touchpoints and use automation tools to make the process smooth. For example, a popup to encourage email signup or automated email confirmation for product delivery. 
  • Say thank you when your customers complete offering you a favor. This reinforces the positive side of their judgment. For example, sending a thank you email after a customer signs up or completes an order.
  • Build a rapport and bank on their earlier favors to request more and bigger ones. Keep adding incentives at the right juncture to avoid it being one-sided. 
  • Use gamification to increase engagement and offer rewards at the end to make it look like a challenge. 

Caveat

Keep in mind the variability aspect of this concept i.e. it may not work when the customer won’t be too invested in doing the favor or the amount of time it’ll take to do it. Hence, you can bridge the barrier by highlighting the benefits for the customer as well as making it fun and easy to carry out the favor. Adding in a bit of reward may also help motivate them. 

4. Make information super easy to consume (Cognitive Ease)

Cognitive ease or fluency makes information easy to understand.

It’s crucial for ensuring the success of any piece of communication. Prospects are less likely to act when it takes much effort to understand information, act on it, or both — especially when they’re busy.

Successful eCommerce brands understand this — they make information easily consumable and actionable. They use shorter signup forms, make checking out effortless and their websites sweet on mobile.  

Mobile-friendliness lies at the heart of eCommerce conversions — over 60% of eCommerce traffic and 53% of sales are from mobiles.

Check out how Keurig uses this concept to increase their traffic and website checkout rate.

Keurig sells coffee makers, beverages, and accessories. The company gets impressive monthly conversions — it received above 3.3 million visits last month.

Visitors don’t need much effort to understand the message and the action the company expects them to take.

Example of clear call-to-action

Keurig understands how to use colors and images to create an aesthetic and visually-engaging store design.

Creating an account is super-easy — no long-form, just four fields.

Example of simple login form to improve eCommerce conversion rates

Why it works

Cognitive ease is a practical principle of high-conversion. Here’s what makes it work.

  • Consumers rarely take action if the message is not immediately apparent and it takes much effort to understand.
  • Websites with aesthetic designs and beautifully laid-out images receive impressive engagements.
  • Mobile drives eCommerce traffic and sales.
  • Shorter forms convert better  — removing a field from the form can increase conversion by 26%.
  • A simple checkout process improves cart conversions — 11% will abandon the cart if the process is complicated.

Quick guide on how to apply it

Follow this quick guide to implement cognitive fluency on your eCommerce website.

  • Make the website messages straightforward and clear.
  • Use crisp product page images and videos.
  • Make your website mobile-friendly.
  • Make forms, buttons, and page navigation a no-brainer.
  • Simplify the checkout process.

Caveat

Long forms can discourage form submission, but the more data your form collects, the more hyper-personalized your campaigns can be — and personalization increases conversion.

In a study by Econsultancy, 93% of companies increased conversions by personalizing their SEM and email personalization helped 92% boost conversion.

Don't sacrifice personalization for shorter forms — find a balance.

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5. Help customers take decisions faster (Hick's Law)

There’s a phrase spoilt for choice but it’s doubtful whether it applies today. In a world full of choices, decision making becomes difficult. This is what plagues customers trying to shop on your store. 

The term for this is choice paralysis or Hick’s Law. Psychologists Edmund Hick and Ray Hyman came up with this concept in the 1950s. As per their findings, a greater number of choices increased the decision-making time. In the case of eCommerce businesses, the effects of this are huge—cart abandonment is one of them. 

Renowned Barry Schwartz too talked about the paradox of choice in his book and Ted Talk. 

One of the first studies on choice paralysis was conducted on jam. The result was that with fewer options, people purchased more. 

Jam experiment of choice paralysis

Smart eCommerce brands reduce the choice paralysis for customers yet still offering them a lot of options. 

See how ASOS eases decision making by neatly categorizing all their product options:

Reducing choice paralysis through categories by ASOS

Why it works

  • Choice paralysis leads to indecision because shoppers find it harder to decide which one to go for. Reducing choices helps in faster decisions. 
  • An overdose of choices leads to decision fatigue 
  • Too many choices also lead to buyer’s remorse i.e. customers feel regret for the products they didn’t choose.  

Quick guide on how to apply it

  • Offer personalized recommendations for customers so that they don’t have to go through the decision making part
  • Reorganize our products into relevant and specific categories so that customers can choose which products they want to see 
  • Shopping guides and comparison charts also help customers make decisions faster

Caveat

Solely focusing on reducing choice paralysis doesn’t help. Identifying the root and solving it can improve conversion rates all over your site.

Optimize your eCommerce website user interface to reduce cognitive load. Simpler interfaces, minimalistic designs and distraction-free navigation helps in better decision making. 

6. Play hard to get (the Scarcity Principle)

The fear of missing out (FOMO) is a major driver of sales.

When brands offer good deals and create a sense of scarcity through time-sensitive offers, the fear of losing out drives consumers to take immediate action — they hate missing out on good deals.

60% of millennial consumers said they often make reactive purchases within 24 hours after experiencing FOMO.

Successful brands leverage this psychological feeling to drive eCommerce successes. They use limited editions, clearance sales, and time-sensitive coupons to create scarcity and play hard to get.

Pure Formulas is a perfect example of this.

Pure Formulas is an online retailer of vitamins, health supplements, and minerals. The eCommerce website received over 896,000 traffic in December and 33%.

The company offers great deals to buyers. It has a dedicated page where it publishes current deals to make them easily accessible to visitors.

The company uses time-sensitive coupons to create scarcity and drive sales.

Example of deals and coupons to communicate scarcity

Why it works

Using scarcity is one of the oldest marketing tricks. What makes it useful? Here are some.

  • Consumers hate missing out on good deals.
  • Humans have a primitive desire for exclusivity — this makes limited edition promos effective — it taps into this desire.

Quick guide on how to apply it

  • Offer time-sensitive discounts and coupon codes.
  • Use a count-down timer in promos to create urgency.
  • Run flash sales at strategic times — holidays, black Fridays, back-to-school periods and during celebrations, et al.
  • Use retargeting ads to offer time-sensitive coupons to people that abandon carts.

Caveat

Abusing coupon codes could lower the perceived value of your products—so use them intelligently and strategically.

Hey, you'll love this: 14 Ways to Use FOMO and Boost Your Conversion Rates

7. Make offers compelling but not pushy (the Fitts Law and Visual Salience)

High converting eCommerce websites obey the Fitts’s Law and the Visual Salience principle — they make their offers stand out and easily accessible.

The Fitts Law states that the time it requires to move a pointer (e.g., cursor) to a target area (e.g., CTA button) is a function of the ratio between the distance to the target and the width of the target.

In simple terms, it’s saying that making the CTA buttons or other essential elements of the web page more prominent or visually salient makes them easier for people to access.

Visual salience is the subjective perceptual quality that makes a thing stand out and grab attention but not large enough to make them obnoxious and threatening.

Successful brands make their offers visually salient, easily accessible, and non-intrusive. Here's how Lego does it.

Lego is a Danish company that manufactures and sells toys. The company receives super-crazy conversions — this is evident in its monthly traffic volume — the website received over 36.3 million visits in December.

Lego uses color contrast to make its CTA buttons standout and it positions them where buyers can easily find them.

Example of contrasting colors to make CTA stand out

It also offers product recommendations to buyers.

Example of product recommendations

The company provides guest checkouts to help buyers save time and reduce cart abandonment.

Why it works

Successful eCommerce brands are using this principle on their websites to drive conversion. Here’s what makes this principle work.

  • Guest checkouts help reduce cart abandonment — a study shows that 23% of buyers will abandon the cart if they have to create a new account.
  • Visual salience makes CTA buttons and offers easily noticeable.
  • Product recommendation provides options for buyers.

Quick guide on how to apply it

  • Allow guest checkout.
  • Put a cheaper or more expensive product alternative within the buyer’s view.
  • Offer bundled products
  • Use visual salience to make the essential elements of your website stand out.

Caveat

Making your CTA buttons bigger than necessary can make them look threatening, pushy, and intrusive — and this is not good for conversions — users often have a distaste for threateningly large lettering.

8. Make your products the showstopper (Center-stage Effect)

Given a choice of products, customers like to choose the one in the middle. 

This preference towards the middle or the center option is driven by psychology. Here’s the intricate process at play: 

There’s a strong connection between what we see and what they choose. There is a tendency to look at the item we choose. The more we look, the more attention we give it, the more the chances are of us choosing it. This feedback loop of looking at an item, liking it, and looking at it even more because we like it is called the gaze cascade effect

That’s not all—there’s something else at play here. Due to the central fixation bias of humans, the tendency is to look at the center of things. 

So, the central fixation bias followed by the gaze cascade effect is what makes us choose something unconsciously even before we consciously decide to go for it. 

This propensity for the center or the middle item is seen in various instances such as numbers, multiple-choice tests,  game shows, and shopping, etc. 

Several researchers have found the center-stage effect at work in real-life scenarios. Various companies use it to direct customers to particular pricing. See how The Economist highlights the center pricing plan: 

Example of center stage effect in pricing plans

Gas stations use it to promote premium gas that few customers choose by placing the expensive option in the center. 

Example of center stage effect in gas stations


Why it works

  • Humans have a general tendency to look at the center and avoid the edges
  • Attention improves the chances of decision making  by creating a loop

Quick guide on how to apply it 

  • Keep your most expensive and popular products in the middle where there is a higher chance of them being purchased
  • If you have a new product launch or want some movement for selected products, then you can use this tactic to place them in the center and highlight them
  • If you have a vast array of products, then it makes sense to place selected products in the center to make them discoverable
  • Ideal for gifting. The center stage effect works better when customers are buying for others. 

Caveat

An exception when the center stage effect doesn’t work is when the products are placed sequentially or numbered accordingly. Research finds out that in case of information that is sequentially placed i.e. top to bottom or left to right chances are that people choose the first or the last option.

9. Be big on endorsements (the Milgram Principle)

People obey and trust those they perceive as authority figures.

Stanley Milgram experimented with measuring people’s willingness to obey an authority figure that instructs them to perform acts conflicting with their conscience. He found that a very high proportion of the subjects would fully follow the instructions, though reluctantly.

Successful eCommerce brands understand this principle. They use endorsements, buyer reviews, testimonials to reinforce brand authority.

A study found that 77% of B2C consumers make purchases based on brand name — in other words, the brand’s strength.

Here's how The North Face leverages endorsements to improve its conversion rate.

The North Face manufactures gear for athletes and modern-day explorers. It has been in business for 50 years and the company’s eComm website has impressive conversion numbers.

It received 11.86 million visitors last month.

The homepage displays various images of real and happy people using the gear.

TNF runs a social media challenge — #NeverStopExploring — that encourages their customers to share a photo of themselves wearing the gear — an impressive way to generate endorsement and create social media awareness.

TNF features the photos on the homepage when they tag them.

Example of social media campaign on homepage

The company also makes it easy for their customers to upload the images directly to their gallery — they can upload from their devices or straight from their Instagram or Facebook accounts.

The company also shows ratings and reviews on product pages from verified buyers. They share the percentage of the reviewers that recommend the product to other buyers. It makes this bold and conspicuous.

Example of customer reviews

The company also shows individual recommendations. TNF makes it easy for new buyers to see who recommends the products and why they do so.

TNF issues gift cards — this allows customers to buy for people they care for or love. Gift cards help generate awareness and drive non-customers to the store.

Why it works

The Milgram principle also works for eCommerce businesses. Here’s why.

  • Consumers get motivated when they see people having a great time with a product they intend to buy.
  • Shoppers check customer reviews before purchasing — 92% do this.
  • Online buyers trust product reviews 12-times more than the product description and sales copy.
  • User-generated content is a goldmine — 85% of consumers find them more influential than brand images or videos and 43% say it’s a great way to discover new products.
  • Companies that use user-generated content see an 18% increase in revenue.
  • 70% of teens trust influencers over traditional celebrities and 49% of consumers depend on influencer recommendations.

Quick guide on how to apply it

Follow this guide to implement the Milgram principle on your eCommerce website.

  • Use—Those who bought this also bought—on the product pages to recommend products to buyers.
  • Display testimonials from happy buyers on the homepage.
  • Use case studies from happy buyers to eliminate buyer remorse.
  • Add reviews and product ratings from verified buyers.
  • Display images of real people,  authority figures, or celebrities that endorse or use the product.
  • Issue gift cards to enable customers to buy for those they care or love — this way, they’ll indirectly create awareness and endorsement for the products.
  • Encourage buyers to spread the word on social media — get them to post photos of them using your products.
  • Use an affiliate program to expand your reach, dive into uncertain terrains and piggyback off people’s goodwill.

Caveat

Fake reviews, testimonials, and endorsements are counter-productive — avoid them. By the way, many buyers can easily spot them, always go for user-generated ones.

Again, don’t delete bad reviews; instead, respond to them and clear the air.

10. Make visitors feel at home (Law of Past Experience)

Online buyers feel at home when brands create a positive shopping experience.

Negative past experiences could deter them from returning to the website. 74% of senior business executives believe customer experience impacts the willingness of customers to become loyal advocates.

Customer experience refers to the experiences customers have throughout the buying journey.

Successful eCommerce brands create positive experiences for buyers to make them feel at home. They provide robust customer support, send real-time notifications, and create personalized experiences.

Real brands make their customers feel right at home. Like Currys PC World does.

Currys is a British company that retails home appliances, computers, televisions, and consoles. The eCommerce website receives terrific engagements. It got about 60.27 million visits in December.

The company has robust customer service. It also provides remote tech support to customers.

Currys’ live chat support enables visitors to chat in real-time with support agents and get instant help.

Example of live chat to increase eCommerce conversion rates

Currys makes it convenient for people to shop on the go. It provides both Android and iOS mobile apps.

Why it works

Here’s what makes this principle work.

  • Positive experience drives return visits.
  • Buyers feel more relaxed when they deal with brands with responsive customer support.
  • Mobile apps provide a convenient way to shop online.
  • Push notifications help brands to send updates and coupons to customers in real-time.
  • Customers prefer live chat over other contact channels — 42% of customers prefer live chat compared to just 23% for email and 16% for social media or forums.

Quick guide on how to apply it

Follow this guide to improve your website customer experience.

  • Provide live chat and phone supports.
  • If you serve multiple locations, use geolocation to serve personalized web content to visitors.
  • Implement email and push notifications — use them to notify your customers, especially when prices drop or something they want becomes available.
  • Develop mobile apps for your store.
  • Provide helpful support articles on the website.

Caveat

It annoys visitors when they use the live chat and they couldn’t get any support staff online — this is always a dent in the customer experience.

A chatbot should take over the conversation when support staff goes offline.

11. Build customer shopping habits (Priming)

Priming affects most of our decisions without us knowing it. This is especially true for customers. 

In simple words, priming is a concept where a certain stimulus influences our responses to further stimuli without us being conscious of it. 

In short, this is what marketing or advertising does. It connects to our neural pathways and creates positive memories. In real life, this is what happens when we see a good or relevant advertisement. Next, when we actually see the product in a store or online, our neural pathways wire back to those positive memories and we have a favorable impression of the product. 

Let’s look at how this translates into customer behavior. In their survey, Nielsen Norman Group found that coupon codes were priming users to expect to purchase the same product at a cheaper price. The presence of coupon codes made users leave the checkout page to find a code and reduce the total. This was because of their fear of missing out (FOMO). 

This is what Vox does on their checkout page too. 

Example of priming on checkout page by Vox

There are several types of primes you can use to boost your conversion rates: 

  • Colors can help to prime emotions. You can use specific palettes for your site depending on your audience and what you want them to feel
  • Copy can help users to connect products to stories. Using storytelling in the product description section can be a good idea
  • Visual content such as images and videos are also positive triggers for customers. For example, images showing customers using your product or videos of the product in real life can make customers think of your product in those situations

Why it works

  • Everyone has long-term memory which stores units of information or schemas. These are activated by external stimuli such as sights, smells, sounds. This makes it easier for us to access our memories. Priming makes multiple schemas activated together which helps our brain process similar information and access memory related to them easily. Hence, offering stimuli to direct customers to certain actions can help improve conversions
  • Customers are always looking for value. Priming helps them to gain value by directing their mental processes accordingly 

Quick guide on how to apply

  • Use priming when you want users to spend more time on your site. For example, using an incentive to explore your products or gamification to boost engagement
  • Priming works well for subscription-based or repeat orders. You can use it to increase the average order value. For example, before the add to cart option, you can ask your customers if they want the product for the short term or long term. Depending on their answer, you can offer a single product or multiple products since they will already be primed based on their answer. 
  • You can use priming to induce price sensitivity too. For example, if you want your customers to get benefits from your higher-priced products, you can drop a survey asking if they’re looking to choose products based on price, quality, or both. Most will go for the 3rd option. This will prime them to consider the higher-priced products as well since they’ll promise higher quality too

Caveat

Be careful to prime in moderation. Negative priming leads to the opposite results. 

For example, during email signup, you can decide whether to mention that you won’t spam them since mentioning it will prime them into thinking about spam and considering their decision. 

Again, coupon codes are essential for all sites, however, it’s important to use them at the right place and the right time otherwise customers may expect a discount for all products. 

12. Price products intelligently (Decoy Effect)

The higher the price, the lower the quantity demanded — this is basic economics.

But for savvy brands, it’s not always the case. They use decoys to get more consumers to smoothly go for the more expensive price package or drive more sales — this is the decoy effect.

This effect is more evident in subscription-based businesses where brands have different pricing packages. They use intelligent pricing (decoys) to entice consumers to select a predetermined package.

Successful eCommerce businesses have found creative ways to use this effect to drive more sales — use of product bundles, point systems, and different pricing options.

They also use loyalty and reward programs — about 84% of consumers say they’re more likely to stick with a brand that offers a loyalty program. And 66% say the ability to earn rewards changes their spending behavior.

Here's how Bellroy does it.

Bellroy manufactures wallets, bags, phone cases — it helps the world carry with simplicity and ease. The company sees impressive monthly conversions. It received over 1.3 million last month.

The company uses product bundles to encourage more sales.

Example of eCommerce conversion rates

It joins two or more products into a bundle and offers a single price lower than the aggregate of the two prices. For the buyers, this is cashing out, but for Bellroy — this is more sales.

Bellroy backs their offers with a three-year warranty.

Why it works

Online shoppers take the bait when they feel a particular price package offers them more value than the others. Other reasons the decoy effect works are:

  • Rewards and loyalty programs work  — customers stick with brands that offer a loyalty program.
  • Point systems can help nurture new customers into loyal ones — loyal customers spend up to 67% more than new customers.
  • Offering product bundles can make buyers purchase more than they intended.

Quick guide on how to apply it

Here’s a quick way to use the decoy effect.

  • Offer different pricing options and bait the package you want shoppers to pick.
  • Use points to drive return purchases from existing customers.
  • Arrange some of your products into bundles and price them intelligently.
  • Use reward programs to encourage buyers to refer your business to non-customers and to spread word-of-mouth.

Caveat

The decoy effect in the eCommerce business gives up part of the profit for more sales — this might affect the company’s bottom line. Always use this intelligently.

13. Don't underestimate the power of "free" (the Zero Price Effect)

As human beings, we all are drawn towards free things. Take the example of when Baskin Robbins offered a free scoop of ice cream to everyone since Dubai was declared the location for World Expo 2020. It’s not difficult to imagine the long queues and huge crowds to avail the free ice cream. 

The zero price effect explains this urge to get free stuff. It’s based on the linear utility model i.e. a fall in the price of a good result in a rise in its utility and demand. We all usually judge the quality of a product from its price. However, when it’s at zero, we usually tend to ditch this decision making and go ahead with a positive perception of the product. 

Perhaps the greatest example of this can be understood from the experiment carried out by psychologist and behavioral economist Dan Ariely. In a stall were displayed 2 products—Lindt truffles, a luxury product, and Hershey’s Kisses, a lower quality product. When the prices for them were 15¢ and 1¢ per piece respectively, around 73% of customers purchased Lindt. However, when the prices for Lindt was dropped to 14¢ per piece and Hershey’s was offered free, then 69% of customers chose Hershey’s and only 31% chose Lindt. 

This is what happens in eCommerce with customer’s tendency to opt for products with free shipping. NRF’s recent report finds out that 75% of customers expect free shipping even on orders below $50. 

See how Zappos highlights the zero price effect with free shipping on the banner and adds some urgency to let customers purchase fast to avail of the free benefit. 

Example of zero price effect in ecommerce

Why it works

  • Customers are usually loss-averse and effort-averse. Free items help them to avoid the process of deciding the value of priced options. Moreover, free offers them a perceived profit
  • Most customers don’t find free options such as free shipping as an extra service but part of the product they are purchasing. Since it’s considered as a necessity, hence paying extra doesn’t make sense
  • People find a free option as a choice. If there’s an option of buying a single product or buying a product with a freebie, most customers will go for the second option
  • Customers mostly overvalue free items. This is because priced items are difficult to valuate, hence leading to a negative customer experience. Free items don’t have those downsides 

Quick guide on how to apply

  • You don’t need to incur losses to offer free products to customers. You can add freebies along with the products
  • Adding free shipping is a no-brainer. Research finds out that free shipping that helps customers save $6.99 is more valuable than a $10 price slash
  • Avoid keeping hidden costs on the final checkout page. Displaying the free benefits builds more trust and helps close more deals
  • You can also highlight the benefit by emphasizing on the difference between the new price and the existing price

Caveat

Zero price effect works only on certain products. The 2 broad category of products are hedonistic and utilitarian. Hedonistic products are used for fun and pleasure whereas utilitarian products are functional and a necessity. 

The zero price effect is seen to work more for hedonistic products than utilitarian products. So, customers may feel more motivated to buy a free chocolate than a free bag of rice. 

14. Use “loss” as a winning strategy (Loss Aversion)

Humans are scared of losses — they value loss more than an equivalent gain.

They'd rather avoid losses than acquiring equivalent gains. An average human will rather not lose $5 than gain a $5 — this primitive tendency is what psychologists call loss aversion. Successful eCommerce businesses understand how to use it as a winning strategy.

Instead of just giving, they also help their customers to prevent losses — they offer customers protection, money-back guarantees, and easy returns—92% say they’ll buy again if the return is easy.

Let's take an example from Dollar Shaving Club.

DSC deals in men’s shaving and grooming supplies. It delivers straight to customers’ doorsteps. DSC’s website converts great — it received 2.58 million traffic last month.

The company offers a 30-day money-back guarantee and also allows customers to cancel their subscriptions anytime.

Example of subscription plan

Customers have nothing to lose buying from DSC. The company makes them feel comfortable and secured — it offers them free shipping for Razor orders.

Why it works

People don’t want to lose — they’re loss averse.

Customers want an easy return process—67% of shoppers check the returns page before making a purchase.

People don’t want to buy something they’ll regret—a money-back guarantee helps eliminate buyer remorse.

Outside helping shoppers save money, free shipping makes them confident of their purchases — they have nothing to lose even if the order turns out to be what they don’t want.

Quick guide on how to apply it

In your sales copies, hint more on what people will lose rather than what they’ll gain. Also, be responsive when they demand any of these offers.

  • Return Policy.
  • Money-back guarantee.
  • A Warranty.
  • Buyer/Seller protection (if you run an eCommerce marketplace).
  • Easy cancellation.

Caveat

Loss aversion only works when people know there’s something to lose—don’t just use it.

15. Honor instant gratification

Customers love instant gratification — they hate to wait — they crave immediacy.

90% of Americans say customer service is a deciding factor when choosing brands and 47% expect websites to load within two seconds.

Successful eCommerce brands understand this simple principle.

They don’t keep their customers waiting. They offer them instant access, quick delivery, and real-time order tracking. Other ways eCommerce brands offer shoppers instant gratification include:

  • Mobile app enabled shopping.
  • Instant downloads.
  • Fast loading website.
  • Responsive and fast customer support.

The Great Courses nails the instant gratification principle.

The Great Courses provides unlimited video and audio learning for college students. Renowned professors deliver the courses.

TGC’s website receives lovely engagement. Last month, it got over 1.2 million visits and over 10% were referrals — evidence of its high-conversion.

The company grants instant access. The courses are available on the go—on TV, computer, and mobile devices.

Example of multiple service channels

TGC offers different learning options to users — video, audio, and DVD.

The Great Courses also allows instant downloads. Learners can download courses and learn offline and at their own pace. The company enables streaming on:

  • The user’s dashboard.
  • Android and iOS mobile apps.
  • Amazon kindle fire.
  • Roku.

Why it works

Speed and convenience dictate today’s buying decisions.

Customers want instant access to their purchases. Many shoppers will buy from the next guy and go home with their purchases than wait for days — unless there is enough incentive to tradeoff. Other reasons this principle work include:

  • Real-time order tracking helps eliminate uneasiness.
  • Customers want fast loading websites and improving site speed can boost conversion.
  • People love taking action on the go — mobile apps convert better than mobile web.
  • Customers are willing to spend 17% more on a company that has outstanding customer service.

Quick guide on how to apply it

Here’s how you can apply instant gratification:

  • Deliver products in days or same-day if possible.
  • Make the website lightweight and fast loading.
  • Offer digital download even if you sell hard copies.
  • Provide product delivery tracking.
  • Make your contact details instantly visible and usable.
  • Develop a mobile app for your store.
  • Offer express shipping.
  • Train your customer support team to be responsive and helpful.

Caveat

45% of consumers say they will switch brands if a company doesn’t actively anticipate their needs.

We live in a world where “make-it-happen-now” is a culture — customers expect instant gratifications. This expectation could make brands compromise quality if it’s not managed correctly.

Final Words

Ready to follow in the footsteps of these high-converting eCommerce websites? Then implement these ten psychological secrets to transform your eCommerce store into a conversion machine.

  • People do business with brands they trust—offer customers unbiased information and be transparent about your offerings.
  • Offer discounts, free eBooks, or anything of value to customers—give before receiving from them.
  • Use cognitive fluency on your eCommerce to drive engagement—use lovely images, make your website easily navigable and simplify the checkout process.
  • Use the scarcity principle to create urgency—offer time-sensitive coupons and run limited edition promos.
  • Use visual salience to make your offers and other essential elements of the website stand out and easy to access—offer guest checkouts and use product recommendations to provide options for shoppers.
  • Display endorsements, testimonials, professional badges, buyer reviews, and ratings on your website—they help reinforce brand authority.
  • Create a seamless customer experience for web visitors—make them feel at home anytime they visit your eCommerce store.
  • Use the decoy effect to drive more sales—offer price packages, use a point system, and run reward programs.
  • Customers are loss averse—in your brand message, communicate what they tend to lose rather than what they'll gain. Also, offer them free returns, warranties, or money-back guarantees to help eliminate buyer’s remorse.
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A/B Test and Repeat

When it comes to improving conversions on your online store, you should leave no stone unturned. But remember to test one strategy at a time so that you can measure its impact on your growth closely, and take the next steps that are driven by concrete data.

Here’s wishing more conversions to you!

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