8 tricks of psychology for better customer experiences

8 tricks of psychology for better customer experiences

At The Real Adventure Unlimited, we design for people. Every day, we plan, design and develop products and services that people interact with. In order to do this effectively, a deep understanding of the audience is key. By tapping into the psychology of our users, we can make work that is not only effective for our clients, but also offers a delightful experience for our customers.

Human psychology is a big, often daunting topic, but for those involved in design, strategy, sales or development, the importance of a basic understanding of how we think and why we act in certain ways can’t be underestimated. In this article I list eight quirks of human thinking and behaviour that can help create magical customer experiences.

This blog post is a written version of a learning lunch that I put on at The Real Adventure Unlimited office recently. These lunches are great opportunities for sharing knowledge with each other, and clients.

Cognitive biases

Cognitive biases are nuggets of easy-to-understand psychology goodness. They explain fascinating human tendencies to think and act in certain ways. They are the result of our evolution, culture, and environment. Our brains are hardwired with automatic responses to situations, which speed up problem-solving and decision-making, so we need not consider common situations afresh every time we encounter them. As well as helping us, they can hinder us, as sometimes these biases prompt us to act in seemingly irrational ways. This means they are open to abuse by evil forces in marketing, but we prefer to use them for good, to give the customer a better experience. After all – no matter how smart we think we are, we’re all susceptible to cognitive biases.

There are many cognitive biases, with more being discovered all the time – Wikipedia lists them in the hundreds. Here are just eight cognitive biases and how we can use them in our work.

1. Goal-gradient effect

A coffee shop loyalty card with 12 boxes, two of which are pre-stamped, will be filled quicker than a card with 10 boxes and no pre-filled stamps. They both require the customer to get 10 stamps, so why? It’s because the first card gives them the illusion of progress, and progress is motivating. The goal-gradient hypothesis says you will accelerate your behaviour as you near your goal.

This effect was identified in 1934 by Clark L. Hull, who found that rats running in a maze would get faster, the closer they got to their food. Knowing about this cognitive bias is useful in several ways:

  • The shorter the distance to the goal, the more motivated people will be to reach it
  • Even the illusion of progress is motivating
  • People focus more on what’s left than what’s completed
  • People enjoy being part of a reward programme
  • When starting customers on a loyalty scheme, giving them a head start will help them move through it quicker

The research: http://journals.ama.org/doi/abs/10.1509/jmkr.43.1.39

2. Choice paradox

Is more choice better? You may assume that people like to be given lots of choice, but it turns out there’s a limit to how many options humans like to cope with. What’s more, giving customers too much choice could hurt your business.

In 2000, psychologists Sheena Iyengar and Mark Lepper conducted an experiment, selling jam at a food market stall. One day they had a choice of six jams, and on another day they had a choice of 24 jams. Consumers were 10 times more likely to buy when offered only six options than 24; and, intriguingly, they reported greater buying satisfaction. Other studies have shown that in speed dating, you are more likely to select a match with six dates vs. 10. It seems that the more choice people are given, the more likely they are to fail to make a decision.

Some people have since pointed out that Starbucks has 80,000+ drink choices, and yet they seem to be doing alright for themselves. While this may be true, I’d point out that Starbucks shows only a small number of choices on their menu, but they allow the customer to customise their choice as they see fit. Choice is hardest for those who are undecided and most paralysing for the customer when all the choices are displayed at once.

People are happiest when they feel in control, and having choice is a big part of that, but we must remember not to paralyse our customers with too many choices, as they will vote with their feet and go elsewhere.

The research: http://hbr.org/2006/06/more-isnt-always-better/ar/1

3. Aesthetic-usability effect

The aesthetic-usability effect is a bias whereby users perceive more aesthetically pleasing designs to be easier to use than less aesthetically pleasing designs, even if in reality they aren’t. Aesthetically pleasing designs have a higher probability of being used, reminding us of the importance of investing in great visual design. If we want better engagement with our work, then we need to ensure it’s as aesthetically pleasing as possible to the target audience.

We know that design that is pleasing to the eye gives our customers greater confidence in their ability to use (or learn to use) our products. This is no secret to anyone who works in design; brands such as Apple have used this cognitive bias to build billion-dollar companies. As legendary designer and psychologist, Don Norman says, ‘Attractive things work better.’

By investing in great design and coupling it with consumer insight, we can apply the aesthetic-usability bias to features that appeal to the target audience, and ensure new products and services are successful.

The research: http://www-users.cs.york.ac.uk/~pcairns/papers/ChawdaCraftCairns.pdf

4. Anchoring effect

The anchoring effect is a cognitive bias that describes the tendency for people to rely too heavily on the first piece of information offered (the ‘anchor’) when making decisions.

An example of the anchoring effect can be seen in credit card statements, where you are invited to make a ‘minimum payment’ each month. Research has shown that without these suggested minimum payments, credit card debts are paid off much quicker, with the customer paying as big an instalment as they can. But it is in credit card companies’ interests for customers to stay indebted to them for as long as possible, so they’re deliberately anchoring their customers with the suggested payment. This tempts customers to pay off a small amount, rather than allowing them to make up their own minds on how much to pay each month.

Anchoring is often employed by charities, which provide suggested donation amounts, such as £5/£20/£100 options. The higher donation suggestion (£100) works as an anchor, so the donor is likely to choose the middle donation amount (£20), rather than the lowest one. Restaurant menus use similar tactics, using a single high-cost item on the menu as an anchor to encourage customers to spend more on food.

Studies have shown that anchoring is very difficult for people to avoid, so decision-makers need to remember that customers will be anchored by pricing structures and other information, whether you intend them to be or not.

The research: http://psycnet.apa.org/?&fa=main.doiLanding&doi=10.1037/0022-3514.73.3.437

5. Surprise heuristic

Whenever we speak to users of our CRM programmes, it’s often the unexpected or unusual aspects of the programme that they remember most vividly, and speak about most positively. The careline you can call 24/7 and get great support from; the pack a mum received in the post that contained bubble bath and suggested they take a break from their busy day and pamper themselves. People react well to surprises, so we need to remember to build them into our work. What’s better than getting a gift in the post from a loved one, when bills and pizza menus are all you usually find on your doormat?

Like many cognitive biases, our tendency to react well to surprises comes from our evolution – in order to survive as a species it’s served us well to seek out and explore new opportunities, to go exploring over the horizon and find new resources. Punctuating the monotony with a pleasant surprise can be the key to creating a great, memorable customer experience.

The research: https://www.psychologytoday.com/blog/creativityrulz/201001/harnessing-the-thrill-surprise

6. Social proof

The other weekend I was in Weston-super-Mare – the ‘jewel’ of Somerset. I was with some friends, and we fancied getting fish and chips. Faced with a bewildering choice of chippies on the seafront, and a lack of local knowledge, we instinctively went to the one with the longest queue. Meanwhile, the chip shop next door had virtually no queue and might have had better food on offer. Why didn’t we just go to the one with the shortest queue?

The reason for our irrational behaviour is our desire for social proof (aka ‘informational social influence’). When humans are undecided, we tend to follow the patterns of others. Again, this is innate; following others is an evolutionary safety mechanism. By drinking from the wrong stream, we might get ill. If we go to where others get their water, we’ll probably be ok.

Building social proof into our digital experiences can be a powerful way to tempt the undecided to act – as the final trigger in motivating someone to make a purchase. ‘Our bestseller’, testimonials, likes and reviews are common ways of providing social proof, but harnessing the power of social networks such as Facebook can give a more powerful way of doing this – knowing that 10 of your close friends bought an item can be a more powerful signal than reading 200 reviews.

The research: http://psycnet.apa.org/psycinfo/1936-01332-001

7. Peak-end rule

Rather than judging an experience in its entirety, humans have a tendency to judge an experience by its peaks – its most intense points and its end. So even if your two-week holiday sat on a beach in the Caribbean was pleasant but uneventful, having your luggage stolen on the way home may cause your long-term memory of the holiday to be negative. This may seem illogical and, like much human behaviour, it probably is, but it’s something we should consider when designing customer experiences.

At Disneyland, waiting times for attractions are deliberately overestimated, so when customers reach the end of a long queue, they are pleasantly surprised that it didn’t take as long as they were expecting. Suddenly, the tediousness of queueing becomes a positive experience.

Often our customers have to do things that they might not necessarily want to do (like queuing, or registering on a website), but they will quickly forget these niggles if we can create positive peaks and ends that punctuate the experience. Instead of allowing a CRM programme for new mums to tail off, why not end it on a positive note by giving them a book that shows their journey from pregnancy to having a toddler? This positive experience at the end will leave a lasting good memory of the brand, encouraging them to recommend the brand to others or use it again. We should always consider where we can create peaks in a customer journey, or how to end it on a positive note.

The research: http://pss.sagepub.com/content/4/6/401.short

8. Scarcity heuristic

Scarcity heuristic is a bias that places value on an item, based on how easily it might be lost, especially to competitors. Scarcity can lead to snap decisions to buy, hence supermarkets selling out of bread due to ‘panic buying’ during a perceived time of shortage. In our office, similar behaviour is triggered by a company-wide email with the subject line ‘CAKE!’ on someone’s birthday. As you might expect, this defensive behaviour is born out of our survival instinct.

As we can’t help but value scarce items, shops have been using scarcity as a way to drive sales for as long as anyone can remember. ‘While stocks last’, ‘This week only’, ‘Last one!’ are all seen on the high street, but scarcity is also a powerful weapon in digital. Invitations to join services Gmail, Google+, and, more recently, the ad-free social network, Ello, have deliberately been made scarce to encourage demand for them, and increase the value placed on them.

Travel websites such as Booking.com and Expedia make much use of scarcity signifiers such as ‘Only 1 room left’, later sending emails reminding you that you have ‘Only 2 days left to review’. It’s worth remembering that such signifiers add to the cognitive burden for the reader, and need to be shown only at the right time, as a nudge to motivate them to act. Scarcity can be a powerful ally – but it can just as easily annoy your audience.

The research: http://psycnet.apa.org/journals/psp/32/5/906

Jerry Springer’s final thought

So there you have it, eight quirks of human behaviour that we can use to create better customer experiences. But before you start rubbing your hands and considering how to use these cognitive biases to trick your customers, remember that, in the long run, customers are likely to form a negative impression of a brand if they feel they are being deceived. Let’s not forget, we’re all vulnerable to the power of cognitive biases.

However, if we use an understanding of psychology to create a good experience for customers, success will follow.

So, until next time, take care of yourselves… and each other.

This entry was posted in psychology, strategy. Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *