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How behavioural economics + principles can be used in everyday business. pt 1

Let me start by saying there are 100+ ways you can integrate theories of behavioural economics, consumer insights and principles into design I will only highlight some of the ones that I think are easiest.

  1. Make it obvious

make the choice obvious consumer psychology

Let's start with the obvious, we notice things that are obvious . We tend to notice what is 'called out' and we are more likely to believe it and choose it.

We want the best deal and if it's further highlighted we are drawn to it even more.

This doesn't just work for the best price, it works for other highlights like 'best seller' or 'staff picks'.

This is what these callouts are done, we want you to notice them and choose them.

How can you use this? If you have products you want people to notice, or purchase, on your website consider highlighting them with 'best seller' or 'our favourites' to help people notice and give people added confidence to purchase them.

the default choice obvious consumer psychology

2. The default choice

By default our brain wants to conserve energy so much like the option above our brain won't do the math, we will trust the answers are correct and trust the best price option but we will also just choose the default that is chosen for us. We think the default is automatically the best option so we will choose it rather than actively unchoose it.

If an option or a checkbox is selected, we will likely leave it.

How can you use this? Most commonly it's used as a checked-by-default option asking you to subscribe to newsletters, or if you wish to be contacted, you agree to donate your organs (there was an actual study done and people agreed more often to donate organs when the default was checked vs unchecked).

3. A little Goldilocks

The bumpers of information make all of the difference in how we choose something. If I present you with an options, depending on those options they can make something look more or less appealing.

the goldilocks pricing - behavioural economics

If something seems 'pricy' showing other more expensive options can make it seem less expensive or having something more expensive and less expensive on each side of the optimal one, can make the middle one the 'safe choice' the Goldilocks effect. This is often why we see 3 tiers of pricing (gold, silver and bronze)

4. Bundle for Value

Consider this, what if I asked you to buy a magazine subscription and its $15.99/month for the print, $9.99 for digital only or $16.99 for both, it really seems like the digital/print together option is the best. It's the same content but you feel like you are getting a good deal.

Bundling also prevents people from making multiple purchases so it can ease the mental tension. This is why we see vacation deals together, or a movie theatre will package tickets and snacks together.

How you can use this: Consider packaging your products or services together and making the package seem more appealing than the individual item.

5. Framing.

What sounds better $2 off $10 or 20% off of $10?. Framing is the way we present information that makes it seem more favourable.

Or choosing a reference that makes information sound better. ie: our stock is 10% higher over the past 12 month (vs up 3% over the last quarter).

How you can use this: consider what sounds more appealing when it comes to your communications.

Stay tuned for more!

Julie Boake

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