Behavioral economics is quite a young branch of economics. It looks into human psychology, and how our purchasing habits are influenced by it. Classic economy states that customers are calculated and reasonable in their purchases, therefore, they only buy the highest quality products that are good for them. The reality is not so perfect. Humans aren’t rational. We are slaves to habit and impulsivity, making decisions based on instinct and other psychological tendencies rather than any practical thinking. Behavioral economics in digital marketing is something exciting to read
Digital marketers are aware of this phenomenon too, and knowingly or unknowingly, they use it when trying to sell customers their products. This can be seen in the big shopping cart at the top of an online store’s page like Flipkart, which makes it so much easier for consumers to order products. It can also be seen in keywords used in ads like ‘free’ and ‘sale’ to grab customers’ attention. Here are some more other areas you can find behavioral economics in digital marketing:
Familiarity Principle
This is also known as the ‘mere-exposure effect. When consumers are constantly exposed to something, they become familiar with it. This happens with online websites too. Customers grow used to certain websites and are reluctant to try different ones.
For instance, once a person shops from a certain eCommerce store, they keep going back to it. Digital marketers can use this principle to their benefit by exposing customers to more of their company's email marketing and social media campaigns. The more consumers see your company online, the more they’ll come back to you.
Habits And Comfort
As I mentioned above, humans are creatures of habit. When we’re required to do something we’re not used to or instantly good at, we grow anxious. This has something to do with the way we’re wired.
Anyway, this stands when it comes to digital scenarios too. When we visit websites we don’t usually go to, we have to start from scratch to learn the usage and ordering procedures of that site. As this takes a lot of effort, every site needs to put in extra work to show us they’re worth our time and energy.
This is where having an easy-to-navigate, convenient site is so important to digital marketing companies. This ensures that there are as few obstructions in the customer’s mind as possible while they’re working out how to use a site. Positive affirmations like a message saying “your order has been placed” or “successful checkout” also go a long way in comforting a customer and encouraging them to come back.
Customer Reviews
We as humans always choose the safe path, and that includes copying what has been done and confirmed before so that we don’t have to take any risks. Very few of us are happy being the first one to try a new product without any reviews; we mainly wait for others to guarantee that a product is worthwhile before purchasing it.
This is why including customer reviews and testimonials on your site is of the utmost importance. It shows that your products or services have been tried and trusted, and therefore, new customers can trust you too. These are just a few ways digital marketers incorporate behavioral economics into their marketing strategies. There may be a lot more ways than you might realize one day while online shopping in a moment of epiphany.
