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4 Psychological Reasons Behind 4 Segmentify Algorithms

In digital marketing, psychology plays a great role. Ecommerce personalization is key to connecting with your customers today, but there is more to just speaking directly to your audience. You need to really know them, and understand just how to persuade them into making purchases.

That’s where consumer psychology and marketing mind-games come in. With some subtle, yet smart techniques, you can tweak your copy to convince your customers to buy more. Retail giants such as eBay and Amazon have been using psychology in ecommerce for years. But it is only in recent years as online marketing and dropshipping have grown immensely popular, that the real value of such tactics are becoming more widely recognized.

Learning how to apply psychological tactics to your digital marketing strategy can help drive online sales. More importantly, it can help your brand develop stronger ties with your target audience, as you establish a position of authority in the market, and make your company known as one that can deliver on your customer’s needs.

It’s Not Blatant Manipulation, It’s Better Marketing

This isn’t manipulation or some unscrupulous trick that deceives online shoppers out of their hard-earned cash. Ecommerce psychology is a bona fide strategy that many marketers are using today. The key thing to realize is the goal isn’t simply to persuade customers to buying your products. Instead, you must convince them of just how valuable your products are.

When you can do that, the sale is easy. This practice not only generates more sales in the short-term, but also helps turn site visitors into loyal customers in the long-term, as people believe your brand to be one of the best. There are many common algorithms on ecommerce sites that utilize this type of marketing to great effect. Here are four ways in which you can see the psychology of selling at its best.

1) Reciprocity for Your First-Time Visitors

If you happen to read just one book on psychology in marketing, then make it Dr. Robert Cialdini’s Six Principles of Influence. His theory – giving a positive experience to someone is likely to compel them to give you something back in return – is one that marketers have been playing on for years.

With the rise of ecommerce personalization, companies are able to tailor special offers for different types of online visitors, with Cialdini’s principle in mind. For example, let’s consider the UK perfume retailer, The Fragrance Shop. The brand selected some choice customers and offered them 10% off their next purchase on the online store. This rewarding experience for the customers encouraged them to act, and conversions were boosted by 112% soon after. By making customers feel special, you can invoke positive reactions that help you improve ROI on promotional offers. 

2) Use Customer Reviews to Up-Sell

You’ve already seen this one in action plenty of times. Think about that check-out process on Amazon, where you hesitate for a moment to look at the ‘Frequently bought together’ items. This algorithm provides a lot of muscle, and can easily persuade customers to add to their cart at the last moment, making it an effective psychological ploy to increase average order value (AOV).

In fact, since Amazon introduced this upselling technique back in 2006, they have enjoyed much greater success, with sales shooting up by as much as 35%, according to ConversionXL. It’s natural for people to want a good deal, and as online shoppers tend to trust other online shoppers more than big brands, displaying proof that products are highly regarded by other customers can exert a powerful influence in online marketing.

Research by eConsultancy estimates that customer reviews are trusted 12 times as much as the product description or sales copy from the company. Therefore, showing frequently bought together items is a good way to show new visitors that your company is alive and kicking. It also proves that your products and services can be trusted. 

3) Leverage Social Proof with Best Seller Campaigns

While we might all want to think of ourselves as individuals, social proof works because people are social creatures with an innate need for acceptance and community. Studies by Nielsen show that 83% of ecommerce customers trust the advice of friends and family when it comes to making purchases.

Companies can drive sales on the theory that we gravitate towards the things that other people like. By labelling products as “Best Sellers” or having a “Most Popular Items” page, you can trigger impulses in your customers, encouraging them to buy, simply because other people have already bought these items.

Clothing retailer ASOS ran a successful social media marketing campaign, called #AsSeenOnMe, which showcased customers wearing their new products. This encouraged existing customers to become repeat buyers and brought in more first-time buyers.

4) Imply Scarcity with Label Recommendations

The final principle that Dr. Cialdini focuses on is the principle of scarcity. This hypothesizes that people are more likely to take action if they believe they could miss out on something. Being told you can’t have something is a strong motivator that makes people want it all the more. In recent times, this psychology of loss aversion has become known as FOMO – the fear of missing out.

As psychology has become a bigger part of ecommerce personalization, many marketers have learned how to harness scarcity to drive online sales. This works because FOMO isn’t just a basic human emotion. The phenomenon instils fear, longing, and excitement in one shot. With creative marketing strategies, your company can harness these different emotions to turn visitors into customers.

Ecommerce Psychology is Integral to Digital Marketing

As artificial intelligence and machine learning become more intertwined with modern marketing, companies will look for more ways to improve their online sales strategies. Understanding the mind of your ideal customer is a crucial part of that. While data analytics enables machine learning to continually improve ecommerce personalization, it’s important that brands don’t forget the power of human emotion.

Knowing how people think, feel, and react to certain situations is something that machines may not understand fully for some time. Digital marketing will continue to evolve, but human psychology will continue to play a part for the foreseeable future.

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