Behavioural Economics in Ecommerce

Behavioural Economics in eCommerce

Behavioural Economics in Ecommerce

Insights of behavioral economics that can be applied in eCommerce :

What is behavioral economics? It is a term that is becoming more and more familiar on a global level in eCommerce. Combining psychology and business, behavioral economics looks at decision making processes from an economic perspective in both individuals and institutions. Why people make the decisions they do based on cognitive, contextual, social and emotional factors. Behavioral economics is not only concerned with the “why” it also looks at the inner workings of how these have an effect on the economic environment.

The first Insight that is addressed explains default behavior and how this can be used to enhance online engagement. Take a look at this example found in an online lecture on Behavioral economics, from the University of Toronto by Dilip Soman, found on edX online Courses. He explains the organ donation rates between different countries. How is this related? Read on, It’s astounding.

Organ donation rates in Canada are 2.5% and in Austria 99%, thats a huge difference. Why? We look at the processes of engagement that donors have to go through.  Have a look at the two processes below :

Organ Donor Process

As Dilip explains in the lecture, the difference is in their default assumption and this has a direct effect on decision making. Humans are lazy, two ways of looking at this : if you need a particular outcome,  check your process of engagement, what processes are in place that inhibit or enhance the outcome. Are you steering consumers on your site the right way, and is it a smooth drive or a bumpy ride? Consider the potential obstructions that consumers will need to overcome in order to land at the desired destination on your page. This default technique is not necessarily restricted to steering consumers, think of the possibilities of applying it in your online marketing strategy. Also consider that defaults signify “sameness” and grouping,  the “everyone else is doing it” effect is strong in decision making.

Decision making is not as easy to trace as we would like it to be, as individuals we are all unique in the reasoning behind decision making. However we are all human, and humans are creatures of habit, therefore we create patterns of behaviour, consciously or subconsciously, according to our own personal frame of reference as well as external environment. This is what we can observe and take forward into the online business world.

To learn more about how we can help grow your online business visit Shopping Directs’ services page now. Contact us for any further information here. We also suggest to check out our infographic on Consumer psychology and eCommerce Checkout process for more insights.

Online Business Points

Instagram Stories

5 Effective Tactics for Using Instagram Stories for Your Business

Instagram Stories

Instagram recently launched Instagram Stories – a new way for people & businesses to share photos or videos, in an auto-play slideshow format, that disappears after 24 hours.

Instagram users have embraced this integrated Snapchat-cloning feature, that boasts 100 million views per day.
“Stories” seems to be a real game-changer, not only for the everyday user but also for brands.

Instagram’s new functionality can help your business drive sales, enhance your company’s reputation and engage with potential customers, by showing another side of your brand’s personality and giving additional context to better connect with your target audience.

Don’t know where to start? Here are 5 effective tactics you can use to your company’s benefit.

You can use Instagram “Stories” to highlight a limited-time promotion of any of your products or services. “Stories” will allow you to extend the marketing message in a less Instagram-centric and more interactive way that’ll help you draw your audience’s attention, as the content will appear at the top of their feeds. You can also offer a discount code that will make your followers feel special, as it’s just available for them. The best way would be to share an image or video of the product, talk about why it’s so awesome, and then add the discount code on top.

An effective technique for retail brands is to showcase an authentic customer experience on “Stories”.
For example, a young woman testing her newly acquired yoga pants by working out.

This will enable your brand to get followers so close to your product they can feel it breathe and can connect to it more deeply. It will come across as an organic product review by a customer backing up your brand.

If you’re currently working on an upcoming product launch or working through something step-by-step, you can add to your Instagram story as you go. Share the process of designing, cooking or editing.

Don’t keep the behind the scenes for yourself, they could help harness excitement for your work-in-progress and create hype around your launch. People love to see and comment on the process of a product, as much as they love to see the end result. Once your product is ready, we suggest doing a quick walk-through of what you’ve created along with info on where to buy.

We strongly suggest using “Stories” to announce important news, rather than just posting it on your Instagram feed. The fact that the “Stories” slider is positioned at the top of your feed makes it more likely to be seen by users. It’s a great opportunity to let your followers know that you’re about to broadcast on Facebook Live, just published a new blog post or will be hosting a cool event next week. Don’t forget to include a short link to the website you want your followers to check out. Mentioning incentives such as a giveaways will always increase engagement.

Many lifestyle brands have started using “Stories” to talk directly to their audience and show off their personal voice on social. Help your customers with styling tips or offer a quick webinar related to your product or service. Starting a dialogue by sharing tips or advice will show your followers that you care about them. It’s recommended to turn on the message feature or point them to your latest Instagram post to allow your audience to respond or ask questions. Building a positive emotional relationship with your followers will increase your brand’s credibility and value.

Now that we’ve got you covered with the tactics, it’s up to you to come up with your brand’s first Insta Story!