– In the United States, online sales currently account for (only) 8% of total retail sales;
– In Europe, this figure rises to 14%.
– 53% of all Internet users made at least one purchase in 2016 (around 1 billion users);
– An average user in the US spends $1,800 on purchases over a year on average, in Europe this amounts to $1,600.
– The main sources of traffic to e-commerce sites: organic, email and PPC.
This infographic shows some interesting additional data that you might want to check out.
E-commerce store owners are continually working to find ways to improve their site and increase sales. Of course, it is possible to continue attracting more traffic, but first you oman phone number library need to figure out how to increase conversion into sales from existing traffic.
The following table shows the top reasons for shopping cart abandonment according to the Statista site:
Credit: Statista. Reasons for giving up on shopping.
Credit: Statista. Reasons for giving up on shopping.
Overall, I would say that most of the courses I took as part of my economics degree at Tel Aviv University were either superfluous or out of touch with reality, except for one course that I felt was really to the point and that I thoroughly enjoyed – a course in Behavioral Economics. Yes, Dan Ariely and all that hype around rational decisions etc. This opened me up to a world of understanding users and trying to figure out what triggers the ‘electrical currents’ that run through their brains when they carry out an action or decision of one kind or another.
Recommended: In addition to Dan Ariely's book, I also recommend reading Nir Eyal's book Hooked, which is about how to form a habit from using your product and what drives people to obsess over one product over another.
In this article, I discuss five proven psychological principles that influence online shopping decisions:
The scarcity effect
Do you know the story of the cookie jars? Here's one of the most familiar stories illustrating this principle, and it goes like this:
Stephen Worchel and his colleagues conducted an experiment in 1975 in which they offered people two cookie jars. One jar contained 10 cookies, and the other contained only 2 cookies. The results of the experiment showed that most people preferred the cookies in the emptier jar (the one containing 2 cookies) even though the cookies in the two jars were completely identical.
kitchen jar
When something is scarce or hard to get we tend to want it more. You may have also heard of it as FOMO – F o f M e n t i n g O f M o n t o f or loss aversion. We spend, or perhaps waste, half of our time on Facebook and social media because we are afraid of missing out on some interesting update or news (even though we know it doesn’t happen every minute). Another principle that goes hand in hand with the fear of missing out is Urgency.
eBay: Example of the scarcity principle
eBay: Example of the scarcity principle
Under this category, it is quite common to see sentences or phrases like: most popular, best seller, 12 people are viewing this product, this product was purchased 22 times in the last hour, last 5 units in stock, 3 hours left before the offer ends, order within the next 27 minutes and receive the product tomorrow, etc.
Reciprocity
I'm sure you've encountered this quite often: you're offered something for free, like a guide/e-book in the digital world, or maybe a new kind of cheese at the supermarket in the physical world. In exchange, you're asked to leave your email address (referring to the first type of offer) or you feel obligated to try a larger pack of cheese (referring to the second type of offer).
Free eBook Download - Created on Poptin Platform
Free eBook Download, Created on the Poptin Platform with Exit-Intent Technology
Other examples: An online calculator to calculate something (for example, a mortgage), an application to make custom clothing after uploading an image, quality content on a blog, etc.
The framing effect
In a word: context. If Jimi Hendrix were alive today and you had the chance to go see his show, you would probably be willing to pay quite a bit for a ticket. But if he were performing on the side of the road, you would probably have walked right on by without noticing him at all. In other words, it all depends on the context and the specific situation.
What would you prefer? A low-fat ice cream that contains 90% less sugar than the average ice cream? Or an ice cream that contains 10% of the average sugar content? Most people surveyed would choose the first option. The same goes for a question like: A plastic surgery with a 90% chance of success, or a plastic surgery with a 10% chance of failure. When we express something of this kind, it is important to think about the outcome (positive or negative) and the qualities we want to highlight.
peanut butter
The anchoring effect
The anchoring principle says that people’s decisions are influenced by the first information they are exposed to about a particular topic. In fact, they rely too much on this information and it becomes an anchor that is difficult to move.
In our daily lives, we frequently encounter being asked a question like how much a specific product would cost or how long it would take to get to a specific place. We get a certain initial answer that we will likely stick to later on. If we go back to e-commerce stores, you might see this principle implemented: as soon as you enter a homepage, you see a particular item with a discount price next to it and an original price crossed out.
