Using behavioural science to turn shoppers into buyers

The late Daniel Kahneman famously said that “thinking is to humans like swimming is to cats… they can do it, but they’d prefer not to”.? And this is as true for humans as shoppers as it is for any other identity we take on in our daily lives.?

So, why does much of what we see in our retail environments appear to assume otherwise?

• Why, for example, do we expect shoppers to read the equivalent of War and Peace on our POS, when they’d really rather not… or more to the point, when they simply don’t?
• Why do we so often see brand-centric, feature-led communications when all shoppers want is to recognize, with ease, that products will deliver against their goals, or their jobs to be done??
• Why are product displays sometimes so fragmented that it’s almost impossible for shoppers to easily find a good starting point from which to browse and engage with the offer?

The answer is that what lands at the coalface of shopping environments all too often falls foul of the tendency to believe that shoppers are prepared to put in the effort, that they are always ‘on’ and will therefore be bound to see, engage with and consider whatever is put before them.?

But, they’re not… and they won’t, by default… because oftentimes, they simply can’t.

How can behavioural science help?

Returning to Kahneman for a second, possibly his most impactful and well-known contribution to our understanding, and, consequently, how we should adapt our Marketing is how he conceptualized the way we operate mentally and make decisions.? “System 1 / System 2 thinking” has become a familiar concept for most, the former acting as our ‘always on’ autopilot and the latter acting as our ‘sometimes on’ pilot.? System 1 is reflexive, fast, automatic, intuitive, virtually limitless in its capacity and largely subconscious; it helps us navigate our lives with minimal effort, making decisions on what we attend to and how we respond based on learnt, associative memory networks and millennia of evolutionary adaptation.? System 2 represents our reflective thinking state, it kicks in to help us deal with unfamiliar situations, with more complex, involved problems, and occasionally to over-ride System 1.? System 2 thinking is effortful and deliberative… and often what’s required to make sense of complex retail spaces and communication – yet it is, as Kahneman said, the swimming of the feline world, and we prefer to engage with it sparingly.

Paradoxically, though often required to decode complexity – System 2 can be “switched off” by the same in retail environments.?? Too much choice, incoherent displays, or complex messages are often too much for shoppers to willingly deal with, resulting in a tendency to revert to System 1 modality.? Other factors can also turn the lights out for System 2: low involvement with the category, information overload and time pressure can all mean that shoppers naturally, and without thinking resort to autopilot behaviours as it’s easier and quicker to get the job done this way.

So, no wonder much of what is done on the shop floor (or, indeed, on the website) fails to achieve its objective: it’s talking to the wrong ‘system’!? In order to talk to and influence shoppers, we’ve always got to be prepared to talk to their autopilot, System 1, and this is where applying the principles and disciplines of behavioural science can be invaluable. So, let's look at some examples...

Getting noticed

We can improve noticeability of displays and communications for example, by applying the principles that dictate how we physiologically and mentally perceive the world around us.? Since humans don’t see with 100% clarity beyond 2 degrees of where our eyes are focused at any one time, getting communications or products noticed requires that they must cut through the blur of peripheral vision - and in a world where many retail environments (especially grocery) are getting increasingly complex, this blur is becoming ever more congested .

There are a number of ways in which attention can be commanded. For example, the use of colour and shape contrast in this display creates visual disruption that can cut through the blur:

And the below is an example of when even the illusion of movement as seen here can attract attention… harking back to our Neanderthal ancestors’ very survival being dependent on their ability to detect movement in their surroundings.

Other attention attracting features include size, surprise, luminosity and of course the human face... all things we are are hardwired to be drawn to in order to ensure our survival.

The above are examples of 'bottom-up' attention where we are attracted by crucial signals (in evolutionary terms) within our environments. There is also 'top down' attention which involves our subconscious constantly scanning the environment for signals that imply goal relevance, directing our attention towards things that can help us achieve our goals at any given point in time.? So, knowing your shoppers, their goals, motivations and expectations will help design environments, product ranges and interventions that will be more attractive to the autopilot shopper.??

Managing price perception

Behavioural science can also help guide how promotions and prices are communicated.? For example, size congruency theory tells us that, contrary to typical practice these days, a promotional price should be displayed in smaller font than the original price.? It makes the message easier to process… and fluency of processing translates into preference.

The image below helps me explain a study where shoppers exposed to the price label on the right exhibited a 25% higher likelihood to purchase than those shown the label on the left.? And yes, this effect has been repliated IRL i.e. outside of the lab

Source: Keith S.Coulter1Robin A.Coulter2 Size Does Matter: The Effects of Magnitude Representation Congruency on Price Perceptions and Purchase Likelihood Journal of Consumer Psychology Volume 15, Issue 1 , 2005, Pages 64-76

And there are many, many more examples of how price perceptions can be managed such as:

• using the decoy effect which influences price perception by introducing a third option that makes one of the other two choices seem more appealing. By positioning a slightly less attractive option near a higher-priced item, customers are nudged toward choosing the more expensive option, perceiving it as better value. Look here for more on the decoy effect Pilat D., & Sekoul D. (2021). Decoy Effect. The Decision Lab. Retrieved September 23, 2024, from https://thedecisionlab.com/biases/decoy-effect

And for a great, easily digestible resource on pricing psychology - take a look at https://www.kolenda.io/guides/pricing .

Changing the decision interface

Behavioural science, specifically behavioural economics, also gives us the concept of nudging:? small environmental interventions that change the decision interface in order to trigger the desired behaviour.? They work on the principle that our behaviours and decisions are often influenced by subconscious mental short cuts (heuristics), and biases… System 1 again!?

Employing the decoy effect is but one example, but there are many other ways in which you can influence purchase behaviour purely by changing the way in which products and communications are presented to shoppers.

The anchoring bias, for example, talks of our tendency to implicitly place disproportionate emphasis on information we are given first or early on in a decision process which subsequently acts as a reference point for ensuing behaviours and decisions. For example, promotional communication frequently anchors the shoppers on the base price first, making the offer price look better value. But it doesn't have to be about price /value - using anchoring can impact volumes purchased too!

In this example, shoppers were presented with an invitation to purchase under two different controlled conditions. Those who had been primed with the number 18 subconsciously anchored on this number and went on to buy 85% more ice creams than those invited to simply buy ‘some’

Source: Brian Wansink, Robert J. Kent, Stephen J. Hoch: An anchoring and adjustment model of purchase quantity decisions

Summary

To conclude, there is much to be gained by recognising four basic truths about shoppers:

1. Just as cats don’t like to swim, they don’t like to think an awful lot: make it effortless
2. They are conditioned by millennia of evolutionary adaptations to attend to, and respond to certain types of stimulus: make it intuitive
3. They don’t shop for the sake of it – there is always a goal to be met: make it relevant
4. And finally, they are more likely to take action if given a little nudge: make it happen