Have you ever checked your horoscope in the newspaper and thought it was surprisingly accurate? Or maybe you once went for a Tarot card reading and found the interpretation really relevant? This is the Barnum Effect at work.
The Barnum Effect, also called the Forer Effect, can be described as the psychological phenomenon, “that occurs when individuals believe that personality descriptions apply specifically to them (more so than to other people), despite the fact that the description is actually filled with information that applies to everyone.”[Vohs, Kathleen D. “Barnum Effect,” Encyclopædia Britannica 2016].
Rooted in people’s susceptibility to flattery and tendency to believe seemingly authoritative sources, the Barnum Effect means that, if delivered the right way, people will accept generalities as being directly relevant to them.
Origins of the Barnum Effect
The Barnum Effect got its name from the 19th century American showman Phineas Taylor Barnum, who many think coined the phrase, ‘a sucker is born every minute.’ However, it was perhaps the work of psychology professor Bertram Forer in the late 1940s that best illustrates the phenomenon.
Interested in studying personality, Professor Forer decided to conduct a personality test (in the form of a questionnaire) on his class of Introduction to Psychology students. The survey was written in such a way as to make the students believe that each of their unique set of answers would be analyzed and used to give them an individual personality assessment. However, Professor Forer instead gave each student an identical assessment – a paragraph full of generalities that could be true for nearly anyone, such as, ‘You have a need for other people to like and admire you, and yet you tend to be critical of yourself.’ [Wiseman, Richard, Quirkology: The Curious Science of Everyday Lives (London: Macmillan, 2007), chap. 1, Google books]
Surprisingly, on a scale of 1 to 5, 87% of students rated their personality assessment as being very accurate – giving it a score of 4 or 5. Various explanations exist for why the students were so willing to accept the bogus assessment, including human gullibility regarding positive feedback and perceived authority figures.
The Barnum Effect Applied to Conversion Optimization
Though most applicable for activities like fortune-telling or horoscopes, elements of the Barnum Effect can be useful in online CRO strategies. Personalization campaigns, for example, can use ‘generalities’ (messaging to audience segments) to make individual customers feel like they’re being interacted with on a one-to-one basis. Think about product recommendations made ‘just for you,’ or personalization campaigns that rely on user behavioral triggers or in-depth demographic data.
At AB Tasty, we ran a campaign with our client Sephora that involved displaying a promotional banner personalized for loyalty card holders. Loyalty card programs already play on the attraction of exclusivity, and though the personalized banner was shown to all loyalty card holders, people have a tendency to feel these kinds of messages are being directed specifically to them. Incidentally, this banner lead to a 16% increase in transactions on Sephora’s site.
AB Tasty client Sephora displayed a personalized discount banner just to loyalty card holders,exploiting the Barnum Effect.
In a similar vein, you can also personalize promotional banners, pop-ins, or any other part of your site with personalized promo codes or messages that, although generic in nature, nonetheless make consumers feel as if they’re being considered as individuals.
Similarly, another AB Tasty client, fashion retailer Karen Millen, set up a personalization campaign (seen below) to promote discounted items only to customers who had a history of buying items on sale.
Lastly, using a client’s first name, birth date, or other personal information is another way of using generic information in the spirit of the Barnum Effect, to make browsers feel interacted with on a one-to-one level.
Personalized emailings are a particularly effective way of harnessing the Barnum Effect to make clients feel special.
Cognitive dissonance is the psychological discomfort we experience when our belief clashes with contradictory information. This unsettling state of anguish, in turn, motivates us to reconcile the difference, either by changing our behavior or altering the importance of conflicting/dissonant beliefs.
Let’s take an example.
A smoker enjoys smoking, but also knows it’s detrimental to health. To minimize dissonance, they can give up smoking (change behavior) or rationalize their habit saying everyone has to die one day, or it isn’t as harmful as drinking. The latter sounds bizarre, but shows the extent to which people are willing to go to reclaim their peace of mind!
So what’s it got to do in an ecommerce setup? A lot.
As more and more people are shopping online, they’re also becoming increasingly skeptical. They notice every tiny detail before they hand over their hard-earned money to you! This means there’s even more of a chance that if they come across any conflicting information on your website, they will experience cognitive dissonance.
You, therefore, must identify loopholes and create a plan that solidifies their trust in you.
Wondering what can trigger cognitive dissonance and how to deal with it? Keep reading to find out.
Display Trust Signals On Your Website
As a safety measure, one of the first things online shoppers do to lower the perceived risk of transaction is look for trust signals, some of which are discussed below.
#1: Multiple, Reputable Payment Options
According to a survey published on HubSpot, 59% of buyers abandon a transaction if their preferred payment option isn’t available. Why? Because people have a varying degree of loyalty towards different payment methods. So bear that in mind and tailor your payment process accordingly. You’ll be leaving a lot of money on the table if you don’t!
With fraud cases on the rise, people are wary about sharing their private information, fearing it will be misused. The good news though is that with trust logos (privacy seals, SSLs, or brand association badges) in place you can tell your customers they are in safe hands.
So, which ones are recommended to use on your website? Well, there’s no one straightforward answer. A famous Baymard’s trust study from 2013 states that people don’t have a preference between trust seals and SSL seals, but they definitely show a preference for antivirus companies, possibly because they are familiar with them. This perceived sense of security based on familiarity implies that people simply want to see a trust seal because it makes them feel safe.
To dig a little deeper, CXL Institute conducted a study to expand on the above-stated Baymard Institute’s findings. They found out that familiar brands like Norton, Visa, Mastercard, PayPal, and Google are the most trusted seals when paying online. What they also discovered was gender and generational differences in ‘perceived’ security. Clearly, this means you must optimize for your audience and not randomly choose a trust logo.
Verified by Visa Program and MasterCard Secure Code on the Victoria’s Secret checkout page.
#3: Reviews and Testimonials
By showcasing social proof on the homepage, product or the pricing page, and near the shopping cart, you will:
Reassure your customers of their choice.
Counter any objection/contradictory thought that surfaces in their mind.
Stop them from unnecessarily overthinking the consequences.
LeadQuizzes uses ‘wisdom of the crowd’ on the pricing page to positively influence their website visitors.
If you run a platform like Etsy, it’s a good idea to add seller ratings to put your customers at ease, as shown below.
#4: Money Back Guarantee
Giving a money back guarantee is a surefire way to keep post-purchase dissonance at bay. There’ll be no room for regret because the stakes are low. Customers can return the product if they are even slightly dissatisfied with it!
But simply ensuring a money back guarantee isn’t sufficient. You’ve got to have a simple and transparent return and refunds process explained on your website. There’s every chance these customers will buy from you again. Here’s proof: 95% of shoppers prefer buying again from the same platform if they had a positive and convenient exchange or return experience.
Step-by-step explanation of return procedure on Zappos
Order Confirmation Transaction Emails
If you didn’t know, an order confirmation email has the highest average open rates at 70%! Two reasons why:
First, it casts away a customer’s apprehension and informs them that their order has been received. Second, it gives them a sense of security; these emails function as receipts required at the time of reimbursement and returns.
If you haven’t been sending order confirmation emails, you’re breaching their trust. The only way to right this wrong is to start sending them and make sure they include:
A personalized thank you note to extend the excitement of their purchase.
Purchase details, like the order number, purchased item (with images), payment details, delivery address etc.
Shipment tracking and an estimated delivery time frame.
Customer services’ contact information and a link back to the website.
Amazon’s email containing relevant shipping and order details
Leverage the Choice-Supportive Bias
Have you ever bought something and immediately regretted it, but also defended your decision because you believe you don’t make bad decisions? That’s choice-supportive bias in action.
During this decision-rationalizing process, we tend to ‘ascribe positive attributes’ to our choice and amplify the negative features of the rejected option. Think of it as a way to reduce cognitive dissonance.
When it comes to your customers, you can reinforce the bias by sending positive and reassuring messages during key stages of their journey. They will end up feeling terrific about themselves!
‘Great choice, there’ or ‘Your cart has some of our bestsellers’ is a perfect way to flatter someone adding a product to their cart. It validates their choice and motivates them to keep shopping. You can also recover abandoned carts by featuring testimonials in your emails. It triggers the choice-supportive bias and before you know it, your customer’s back on the purchase path!
In fact, once they checkout, pep them up with a congratulatory, ‘What fine taste’ message!
Another way to activate choice-supportive bias is by pitting free and premium features against each other. The free trial user will immediately be more confident about their choice and might even become a paying customer!
Create a Sense of Closure
Customers love having choices but also find it overwhelming. Even when they do zero down on one and buy it, they agonize over all the other still available options and begin to regret their decision! This is why it’s important you offer some kind of choice closure to your customers and shut their minds off from alternate choices!
An effective choice closure strategy is asking for product reviews. Make sure you time your request and ensure they’ve used your product long enough to write a review that’s closer to their actual experience.
This Sephora email includes a sample review and rating to motivate customers to write their own!
Provide Exceptional Customer Service and Support
There’s nothing more dreadful than dealing with a customer who’s having second thoughts about their purchase! It may seem like all your efforts of building a customer-client relationship have gone to waste. One way you can rectify this situation is by providing an excellent customer service. And it starts with being there for them at every stage of their buyer’s journey.
Speaking of which, here’s how you can follow suit and prioritize customer satisfaction:
Ensure your customer services and support team knows the business inside-out.
Have a contact page easily accessible from anywhere on the website.
Mention how long it takes you to respond to queries. It’s called expectations management.
Do away with canned responses; become more human.
Use a live chat tool for faster customer support and better customer experience. A study revealed that as many as 77% of customers won’t make a purchase on a website if there’s no live chat option available!
Once a customer has a stellar experience with your brand, they will stick with you for longer and become repeat customers. Furthermore, their word-of-mouth marketing will grow your existing customer base!
Send Feedback Surveys to Feel Your Customer’s Pulse
Listening to your customers is the quickest way to learn what causes buyer’s remorse. But getting actionable insights means asking the right questions. Have a look on what to ask:
What made you buy the product?
How is it helping you?
What doubts did you have before buying it?
What was the biggest challenge in finding the right product?
What made you nearly abandon our website?
Was there any particular information you couldn’t find an answer to on the website?
Any other comments or remarks?
Meanwhile, it also helps to follow some of the best practices when creating a survey:
Use simple, jargon-free language.
Throw in a variety of questions, e.g.: multiple choice, likert scale, ranking, rating etc.
Ask neutral questions like ‘How helpful was our customer services team today?’.
Avoid double-barrelled questions, which means address only one topic per question.
Show a progress bar to keep them going.
Ask open-ended questions towards the end.
Test on multiple devices.
Always A/B test.
With that taken care of comes the timing of the survey. Ideally, send it when you’re still fresh in their minds. Their answers will be closer to their actual experience and you’ll be on your way to fixing bad experiences in no time!
Connect With Them Over Your Blog
The more invested a customer is in you, the stronger the chances they will slip into a state of cognitive dissonance. It’s especially true for B2B buyers.
Once you consistently create valuable and relevant content, you’ll be viewed as an expert. Combine that with your interest in interacting with your readers in comments, and you’ll create massive opportunities for your sales team. Prospects will walk straight into your marketing funnel because you seem trustworthy, interested in helping first and clinching a sale later.
You can learn a great deal about getting blogging right from Zapier. They write detailed, informative posts and are able to impress their website visitors.
Wrap Up
By now you know the strategies you can use to reduce the chances of your customers experiencing cognitive dissonance.
Remember that all that your customer expects is a smooth experience from the beginning to end. They should be able to locate trust signals, know you’ve received their order, and that you are there when they need your help. Even returning the product shouldn’t be a hassle.
Also, shut them off from available options to reduce post-choice regret and analyze survey feedback to learn about the source of their buyer’s remorse.
Over to you now: How ready are you to take the bull by the horns?!
In this post, we set out to give you a clear definition of cognitive biases, why they are important and how to use them. Why are they so essential, you ask? Well, because human psychology is a complex, deep subject that still largely remains a mystery – even with today’s scientific efforts. Although most people picture themselves as rational beings, the truth is otherwise: most people do not act rationally.
Why?
Because human behavior also relies on emotions, feelings, social interactions, and basic instincts to survive, live, and thrive.
Over the course of our lives, we accumulate knowledge, memories, and experiences that help us process information and formulate judgments and decisions. Obviously, our behavior changes as we grow older and evolve in our society – it’s a never-ending story.
We are much more intricate than computers and machines. And that’s OK.
It is human nature to be deeply social: we tend to live with, by and for other people. This is why we tend to have cognitive biases in our decision-making processes.
In this article, you’ll learn that most cognitive biases are either based onperception or cognition – our abilities to experience things and process information.
First things first, let’s start with a quick definition:
What are Cognitive Biases?
Definition: Cognitive biases are psychological deviations from rationality caused by distortions formulated by our brain when it comes to judgment, perception, memory and decision-making processes.
Although their classification remains subject to controversies and discussions, here’s how Wikipedia classifies them:
In order to apply this cognitive bias to real-life scenarios, marketers use various techniques such as slogans, repeated ads and retargeting to create a “loop-effect” in their customers’ mind.
With familiarity comes trust – a repeated marketing message slowly becomes a truth or a universally-recognized statement.
The In-Group Bias
What is it?
The in-group bias (or favoritism) describes the tendency to favor members of one’s group over outsiders.
Deeply rooted in social psychology, this cognitive bias pushes members of a group into giving preferential treatments to others perceived as members of that same group.
Consequently, in-group members can develop behavioral traits that can impact resource allocation, communication, and perception.
How is it applied to marketing?
Belonging to a social group is a social need that answers two main human concerns: our self-esteem and the perception of our social identity.
When used for marketing applications, the in-group bias can be a powerful tool to increase sales, profits, brand awareness, and brand loyalty.
Creating a feeling of belonging to a community is a massively powerful tool for companies that can apply to both B2B and B2C companies.
When done properly, members of your community become more prone to:
Spend more and less consciously – Research has shown that the in-group bias influences resource allocation: people feel better about spending their money on products and services that connect them with other people. They’re also less hesitant about spending for those.
Tell others about your business/product/services – It’s no breaking news – people tend to brag about their positive experiences and group experiences usually bring positive feelings.
See Fortnite’s example of the ingroup bias.
There are various video games that have heavily relied on the in-group bias to increase average-spending-per-user and overall sales.
Epic Games’ Fortnite has achieved an incredible average of $58 spent per user, racking up almost $300M in a single month in April 2018.
Their secret?
A huge community backed up by a tremendous number of YouTube and Twitch streamers that fueled a real passion for the game. This has brought many players to join the game and spend real dollars on in-game purchases that anyone can see, namely the Fortnite community.
The Authority Bias
What is it?
The authority bias – made famous by Stanley Milgram’s 1961 experiment – states that people tend to attribute a greater accuracy to the opinion of an authoritative figure.
Besides, the authority bias has also shown that people tend to be more influenced by information coming from an authority figure, regardless of the actual content of that information.
How is it applied to marketing?
Although politicians also use this bias, marketers use the authority bias as a weapon to convince potential customers.
The most common example of the authority bias can be found in advertising: how many times have you seen a doctor or a dentist trying to convince you that this is the right product for your health?
You guessed it, authority bias strikes again.
This technique is omnipresent in ads and marketing campaigns – think about the numerous “experts” or “celebrities” used in advertising.
If you’re in a B2B business, remember that authority can take many forms: you can target authoritative publications or use case-studies from renowned companies to enhance your brand perception.
The Anchoring Bias
What is it?
The anchoring bias influences decision-making processes and is well-known for its repercussion in price negotiations.
It’s a tendency for individuals to favor the first piece of information received when making decisions – also known as the anchor – over any subsequent information.
An anchor is basically a starting point from which all further discussions, judgments, and negotiations will be formulated. It can be a range, a price, or any type of information. Prices, however, are the most commonly cited example for this bias.
How is it applied to marketing?
When establishing prices or working on new offers and designs, smart marketers can use the anchoring bias to determine whether or not their ideas align with the customers’ expectations.
This technique can yield great results because the vast majority of consumers are exposed to lots of advertisements and “anchors”. It could be time to create your own proper anchor.
Xiaomi’s example of the anchoring bias
In late 2018, Xiaomi came up with the Pocophone F1: a near-flagship, affordable smartphone that redefined price benchmarks for a whole market.
Source: Google
When it came out, reviews and tech-savvy influencers echoed Xiaomi’s new smartphone as the “bargain of the year”. It also became the “new benchmark” for other manufacturers.
Thanks to the Pocophone F1, Xiaomi used the anchoring bias to set a new “anchor” for the mid-tier smartphone market: customers now expect near-flagship specs at an affordable price, even from other manufacturers.
The Hyperbolic Discounting Bias (or Present-Bias)
What is it?
The hyperbolic discounting bias – also known as the present or current moment bias – is a cognitive bias that makes people favor immediate payoffs compared to later payoffs.
When exposed to two positive outcomes, humans develop short-term preferences and are very likely to choose the one that will happen the sooner.
As a consequence, humans tend to make inconsistent choices that their future selves would regret as they have current moment bias at the time of the decision-making process.
How is it applied in marketing?
Marketers have long used the current moment bias to play on the consumers’ wants and desires.
Because we favor the present, smart marketers can promote immediate pleasures and instant gratification so that we buy now.
For instance, borrowing on credit cards is a common consequence of the hyperbolic discounting bias: many people would rather indebt themselves to buy a television now (and pay interests) than wait until they have sufficient funds.
A 24-month financing can be a tempting option to buy that TV now
In order to use the present moment bias effectively, marketers emphasize two main characteristics:
The tangible benefits (what’s in for me now?)
The ease of use (how easy is it and how fast is it?)
BuildFire is an online tool that lets you develop your own mobile application without the usually required hassle: there’s no coding required nor hiring developers.
The entire copy of the website centers around the hyperbolic discounting bias: you can have your app now, without spending too much and without waiting for too long.
Throughout their website, BuildFire’s goal is to demonstrate instant gains and massive savings in order to have you act now.
The Observer-Expectancy Effect
What is it?
The observer-expectancy effect is a cognitive bias defined by the tendency of a researcher to subconsciously influence an experiment because of his own cognitive biases.
The expectancy effect is linked to the confirmation bias – i.e the tendency to seek out and favor information that already falls in line with our beliefs – it causes marketers and researchers to create biases in their own experiments.
How is it applied in marketing?
Marketing (and for that matter, digital marketing) requires research and experiments in order to achieve greater sales and increase conversions.
As marketers, we develop assumptions and hypotheses based on our knowledge and past experiences.
However, many marketers don’t realize that their own assumptions can skew or distort their experiments. We often try to prove a certain point and influence our tests in the process.
By doing so, marketers often run inherently biased experiments: they’re trying to prove themselves right rather than run an actual experiment.
This is where A/B testing comes in.
Using A/B testing properly, marketers can run statistically relevant experiments using randomized samples and fair traffic attribution. Simply put, A/B testing can be a powerful tool to use the observer-expectancy at your advantage. You can statistically prove your assumptions and drastically increase sales – or be proven wrong and move on to your next assumption.
At first, one could think that the variation (=the blue line) would have outperformed the control version (=the green line). As days went by, it appeared that the variation and the control version actually performed the same. Without this 18 days A/B test, one marketer could have easily mistaken the first results for an impressive surge in conversions, although the test has proven him wrong in the long run.
That’s it for our first take on cognitive biases applied to marketing.
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There are dozens of concerns a prospective customer might have when they are shopping on your website.
Would the product actually do what it promises to do? Can they trust you with their credit card details? Would you actually ship the product and not run away with their money? Can your company be trusted on your shipment and return guarantees?
‘Purchasing anxiety’ is the term used to refer to these thoughts, and is many times the reason why a customer might abandon their cart midway through the buying process. Not surprisingly then, such anxieties are more common on startup and small business websites than for big retailers like Amazon. So what’s really causing this anxiety? Let us look at the science behind this.
In 2013, filmmaker and author Errol Morris, in association with the New York Times, conducted an experiment to study the link between reader perception and typefaces. His study showed that readers are more likely to agree with an essay if it were written with the Baskerville font instead of Comic Sans or Helvetica.
It is not difficult to see why. The Baskerville font shown above demonstrates a level of authority that Comic Sans does not. If you were a buyer who is just about to spend a hundred dollars on a product, it is easy to trust a sales copy written with Baskerville over one written in Comic Sans.
Morris’ experiments are thus relevant not only for newspapers but also for eCommerce stores trying to persuade visitors to buy their products. Sometimes, even seemingly trivial elements like the font or your brand name can have an impact on the way visitors engage with your website. This is because such elements influence your perception of the product and the brand. A brand that does not exude credibility often sees their ecommerce conversions go down.
Even seemingly trivial elements like the font or your brand name can have an impact on the way visitors engage with your website.
But before we look at ways to bring a visitors’ anxiety down, it is important to know what makes them convert in the first place.
Dr. BJ Fogg from Stanford University coined what is now known as the Fogg Behavior Model (FBM). According to this theory, the trigger for any behavior comes from three specific elements – Motivation, Ability, and Trigger (B=mat).
Applying the FBM theory to eCommerce conversions, you can say that for conversion to happen, the prospective buyer must have sufficient motivation, ability and must be exposed to the right trigger. Your motivation to buy a gift for your spouse, for instance, dramatically increases when you get closer to their birthday. At the same time, no amount of motivation is enough to gift your husband his favorite car if you cannot afford it. The trigger to convert can come in the form of a rightly worded ad copy or CTA.
A highly motivated visitor who is exposed to the right triggers and has the ability to buy could convert even if you do not demonstrate adequate trustworthiness. This is the reason why a lot of scams still work – people who fall for the ‘get rich quick’ schemes are sufficiently motivated and do not stop due to their purchasing anxieties. That is however not true for regular product purchases where there are dozens of rival stores vying for the customer’s attention. Conversion in these cases only happens if the store demonstrates adequate credibility to reassure potential customers.
According to clinical psychologist Dr. Elvira Aletta, anxiety thrives on ignorance. By educating a prospective customer and addressing their concerns, you help fend off the anxiety that they may have before placing an order. The bad news, however, is that there is no foolproof method to fend off all kinds of purchasing anxieties. It depends to a great extent on your industry, the products you sell, the pricing and the buyer in question.
Product Details
A buyer deserves to know everything about the product, not just the advertised claims. This means that in addition to providing the complete specifications and details about the product, you should also include feedback and reviews from other customers and any third party product ratings. If you are an apparel store, you may also encourage past customers to share pictures of them wearing these accessories – this further helps a prospective buyer with their purchasing decision and brings their anxiety levels down.
Pricing And Shipping Details
The one thing that holds a customer back even after they are convinced about the quality of the product is the price. This, of course, does not apply to all businesses and some industries are more price-elastic than the others. Convincing customers that they are indeed getting a good deal is thus paramount for some stores. There are a couple of ways to do this – you could either offer a discount coupon to reduce sticker shock or you could make shipping free. It is a good idea to have a dedicated shipping page where you explicitly mention the shipping options, cost of shipping, shipment duration, handling time and restrictions. No matter what you do, make sure that the customer is not made to pay more than what they think they would be paying.
Business Details
The other most important thing that worries a buyer is your business credibility. Many online stores regard pages like ‘About Us’ and ‘Contact’ as a mere after-thought. In reality, though, a lot of visitors look these pages up to assess your business credibility. A good ‘About Us’ page should include your company history, photos, and profile of your team members and well-made visuals to highlight your business achievements, clientele and so on. Do not make the mistake of merely including a web form in your ‘Contact’ page. Make it a point to offer multiple channels of communication (like email, snail mail, phone support, and so on). This demonstrates that you are here to stay and are not going to run away with the customers’ money.
Author Bio: Anand Srinivasan is the founder of Hubbion, a free project management tool for small businesses. Hubbion has been ranked in the top 20 in its category by Capterra.
