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How to use marketing psychology to improve your conversion rate

August 18, 2021

What do psychology and digital marketing have in common? With conversion rate optimisation underlining everything we do, it’s a topic we’re always investigating at ClickThrough Marketing.

As a psychology graduate, my own research is based on Dr John Watson, an American psychologist who conducted a number of experiments on the process of human conditioning in the 1920s. Shortly after completing psychological research about conditioning responses in human behaviour, he realised the learnings he had taken could be applied to advertising, and (as there was more money in this industry than academia!), he quickly made the jump.

Over the years, these studies developed further, into consumer behaviour and the psychology of digital marketing. Both of these areas draw on multiple disciplines, including psychology, sociology and economics, to explain the choices that consumers make and help us, as advertisers, to understand how we can approach our audiences. Digital marketing is so much about looking at trends and seeing what is happening, but it’s important to dig into this further and find out why those things are happening. By looking at this online behaviour through psychology, we can leverage this to take advantage of the natural patterns of human behaviour which causes us to react in a certain way when shopping and browsing online.

Four studies all marketers should be familiar with

There are a number of psychological studies that have been conducted in the past that can help us to market more effectively. The below are just four of my favourites, that I feel really help us understand how to apply some psychological know-how to our campaigns.

Planning a holiday? Take notice of the signs in your hotel room. Goldstein, Cialdini and Griskevicius (2008) conducted a study in hotels to motivate environmental behaviour. Next to the towels, they showed three messages:

  • ‘Help save the environment’
  • ’75% of hotel guests in this hotel reuse their towels’
  • ‘75% of hotel guests in this room reuse their towels’

Messages relating particularly to the guests in the room, led to participants increase reusage of towels by 15%. If we relate this to marketing, it is important to always relate the message back to being as personal to our customer as possible. If you can frame it in a way that relates directly to the consumers’ situation, it will encourage the consumer to take action.

So now we’ve seen how to imply an action is needed, what about when you’re explicitly asking your customers to do something? Our next study, from Freedman and Fraser (1966), involved the two psychologists knocking on front doors and asking residents to do something small:

  • Signing a petition
  • Putting a sticker in their windows

And, for some other houses in the neighbourhood, they didn’t speak to them at all. When they revisited houses, people who they had already approached were 3 times more willing to agree to a larger request for a different issue and 4 times more willing if the request was for the same issue. If we relate this to marketing, many businesses are focused on their ultimate conversion or goal, however, if you get consumers to do something smaller, like signing up for the newsletter, the likelihood of them coming back and completing a bigger conversion is much higher.

In many cases, customers respond to repetitive rewards that keep them coming back. Skinner (1948) studied operant conditioning, where we learn to associate behaviours with events e.g. associating going back to a restaurant with getting a free drink. In true science lab form, this has been completed with two sets of rats, who were:

  • Rewarded every 5th time it pressed a bar (fixed ratio schedule)
  • Rewarded randomly (variable reinforcement)

The second option (rewarding randomly) was more longer-lasting in terms of encouraging the required behaviour and required less reinforcement (so less reward, in this case, food!). If we relate this to marketing, it’s similar to those loyalty rewards that many coffee shops use, where if you buy a certain number of drinks, you get one free. Starbucks’ rewards system, for example, rewards customers with stars based on how much they spend and offers different rewards for various levels in their system. However, random reward has been shown to be more effective, so randomly providing someone with a free drink, rather than using fixed reward system, would be a better way to encourage the consumer to do what you want, in this case, buying more coffees!

Finally, let’s look again at wording, particularly when handling how to present deals to customers. If you were presented with these two options for buying a jacket and tripod – which would you choose? (Kahneman and Tversky, 1984)

  • £113.50 for the outdoor jacket, £23 for the tripod
  • £125 for the outdoor jacket, 50% off the tripod at £11.50

68% of respondents were willing to buy the option with the tripod at 50% off, whereas only 29% were willing to buy the jacket at £113.50, even though it’s the same price and deal either way. If we relate this to marketing, framing is super important. In this example, the offer you are providing is exactly the same either way, but consumers are so much more likely to go with option two as they perceive the percentage discount as a better deal than simply offering a product at a lower price. It’s important to not only test this (through A/B testing), but also to focus on the percentage discounts, as opposed to money off.

Pavlov’s humans: how strong branding triggers conversion

Let’s move on to a psychologist you may already know – Pavlov and his dog. Pavlov did a number of experiments with dogs, testing classic conditioning, resulting in the well known experiment of Pavlov (1890) ringing a bell and then serving the dog meat. The dog soon learnt to associate the bell with dinner time and, eventually, it was enough to just ring the bell to make the dog salivate.

Ever wondered why catchy jingles work so well for brand recognition? Humans can be classically conditioned just as well as Pavlov’s dog, which is why brands use jingles and catchy slogans which cause the desired outcome of conversion or recognition just from hearing the sound. If we relate this back to marketing, it is important that you associate something with your brand, whether that’s music, a logo or colour palette. For example, when you see this particular combination of blue and yellow, you think of Ikea;

But seeing this combination will make you think of RyanAir:

And this will make you think of EE:

It is important to provide consumers with something to latch onto, to provide them with greater association to your brand. Though each brand is using a blue and yellow colour palette, taking ownership of a particular tone has solidified the brand’s ownership and triggers a response. And, if seeing these hasn’t made you want to buy some flat pack furniture, book a flight, or upgrade your phone plan, I’m sure this will have you reaching for the chocolate:

There are tonnes of other examples of how to trigger a conditional response with branding, including:

  • Psychology of colour (green is go, red is stop/danger)
  • Reciprocity (you do something nice, in return, they feel obligated to return the favour)
  • Scarcity/FOMO (triggering the fear of missing out if they don’t act right away)
  • Implicit egotism (matching language and tone)
  • Sense of belonging (in keeping with Maslow’s needs and people wanting to belong to groups)
  • Persuasion architecture (using arrows or text to direct order and flow)
  • Anchoring (comparing the product they are looking at to a more expensive version)
  • Paradox of choice (giving them options to assess, but not too many to be overwhelmed)
  • Loss aversion theory (people want to avoid losses, as opposed to acquiring gains)

Knowing how to apply these to your advertising campaigns and product pages can make a significant difference to your conversion rate and guide your customers to purchasing.

The takeaway

So, looking back at what we’ve learnt from each of these studies, we now know to;

  • Relate the message back to being as personal to your customer as possible.
  • Ask your consumers to do something small, like signing up for the newsletter, then build up to a larger conversion.
  • Offer rewards – randomly dispensed rewards will be hard to predict so bring back your customers hoping to get one!
  • When running deals, do A/B testing to settle on the most impactful copy and focus on the percentage discounts, as opposed to money off.
  • Use bold branding to encourage conditional responses

It is very important to break marketing back down to what it is we are doing, which is ultimately, trying to generate a certain consumer behaviour (e.g. filling in a form or purchasing an item). The more we can learn and understand about the fundamental way that humans behaviour, the more we can make smarter marketing decisions, tapping into these behaviours and using them to achieve the desired outcome.

Written by Sarah Clarke, head of PPC, display, and programmatic advertising, ClickThrough Marketing

Sarah Clarke is ClickThrough’s head of PPC, display, and programmatic advertising. She completed a bachelor’s degree in psychology in addition to a master's degree in digital marketing and has working in digital advertising since 2015. She has previously held positions at iProspect and Impression and has also appeared as a guest lecturer and worked as a digital marketing development coach.

Tags

psychology
marketing theory
conversion
conversion rate optimisation
CRO
consumer behaviour
consumer behavior
consumer engagement
Consumer Journey
consumer marketing
consumer trends
ryan air
EE
ikea
cadbury
Starbucks