Social Economics

Any tool can be used by people to create or destroy; it all depends on the person. Humans are the major agents of impact and change on our earth. We are in control of our destiny. When we are all told that we are in control of our emotions, we agree. We are the ones in control of our behaviour, our decision-making. So imagine when someone tells you that, in fact, there are external factors which actually change the way you think, the decisions you make; we get rather defensive and believe this to be untrue. If you are completing a task as something as mundane as filling out a form, you are the one who decides which box to tick and which box not to tick… or are we? Are we living under the impression that our decisions are merely illusions?

Now there are people who have dedicated their professional and academic lives to this line of thought and have created the apt term, ‘Decision Illusions’. Given my area and field of expertise with advanced online marketing and entrepreneurship it all got me thinking, ‘how can this idea of social influence be used to help SMEs’? Business success, after all, depends on the consumers’ ability to make a choice, to make a decision, to use and purchase that business’s product, or their service.

It’s the study of behavioural economics and I am fundamentally curious with how this can impact online conversion. It is possible to create a landing page or a checkout system which actually encourages consumers to click ‘buy’ or ‘quote’ on a semi-subconscious level. Importantly, this is not the manipulation of behaviour. It is, rather, having an understanding of the environment that surrounds us and using this to provide the choice, the option, for people to make a particular decision. A user, which includes you, your family, your friends; all believe they’re rational decision makers. However, research has proven that we do not make decisions based on rational thought. Rather, we make decisions on emotions. Emotions lend value to the user’s options they are faced with before they make a purchase. Users are constantly battling the temptation to purchase a new product or service. It’s why people reason with themselves, because of the need to be convinced to either not make a purchase or to make a purchase. They have to be able to justify it.

Creative thinking and brainstorming ideas

This is when the anxiety of choice comes into play; the ideology of choice is very successful in opening for people a space to think about an imagined future. If I buy this, this will happen. Or, I could only have this product or service if I see myself in a particular light. Even our relative forms of perception factor in. It’s the battle between the present and future self. The difference being is that the present self is the one that is always in control of the decision-making. The key is that you can’t just think about what you, as a business owner, are providing on your end of the transaction. You must think about the environment of the customer. In an insightful and thought provoking blog written by Irrational Labs, I came across this quote, “Instead of asking yourself or others what you want to do and why, start analysing the environment in which you are trying to be successful” (2014).

Your website provides a digital experience to anyone who visits it. When you think about the fact that people’s external environments are something that you might be able to understand, you also realise it is not something you can control. It can hugely impact on a user’s ability to interact with your site, so you should invest in creating an immersive digital experience. This is when you begin to realise that the little things really do matter and for which social economics could provide the answer. For example, Dan Ariely, author of the New York Times Bestseller ‘Predictably Irrational: The Hidden Forces that Shape Our Decisions’, enjoys using the following example in a Ted Talk to explain what social economics can do. Throughout Europe, as with countries all over the world, government departments have organ donation forms which people must complete and sign off as to whether they want to be organ donors or not. Ariely goes on to say that the countries which experience the highest organ donations, in comparison to the countries which had low rates, only did one thing differently. That one thing was a simple word added to the organ donation form (2008). Hard to believe, but true.

If something so seemingly insignificant can change the course of people’s abilities to make decisions, imagine how this science can be used elsewhere. It really makes you think what small detail you could be missing which could make all the difference to the success of your business. The attention to detail can help to make a good website a great digital experience. A great starting point for this is knowing who you want to experience your great website. This way, you can tailor it to suit them. This way, you can focus on the details which will turn a page visit to a conversion.

Web design is far more than making a website visually appealing. Yes, aesthetics are important, but there is a science behind the art. Even the brain’s ability to retain information must be considered. For example, for any copy which appears on any page of a website, the most important information should be situated at the beginning and the end of the text, as this is when a person’s frontal lobe is most likely to retain information. Also, ever heard that people tend to focus on the negatives more than the positives? Put this into practice and instead of explaining the benefits of what a user will experience when they purchase your product or service, explain the costs and the negatives they will experience if they do not purchase and use your product or service. People are much more susceptible to placing a value on losses than supposed gains.

The truth is that design impacts on a user’s behaviour; it impacts on their ability to make decisions. Surprisingly, your business’s reputation can also impact on the way a user experiences your website. It’s called the placebo effect. If a user has heard or read great things about your brand, your products, your service, then when they finally interact with an aspect of your business, like your website, they are more likely to walk away with an actual positive experience because of the prior positive connotation they held.

A great digital experience will not manipulate a user; rather, it will reinforce behavioural tendencies which already exist within the user, therefore encouraging them to make a particular choice. This choice of course will reflect your own preferable outcomes, whether that be to pick up the phone and make a call, make a donation to a charity, complete an online form, or to select and click ‘check-out’. Essentially, if you want to use this information, you need to understand the relationship of social economics and your target customer. Give us a call at SponsoredLinX today on 1300 859 600 or visit our website to learn how you can successfully integrate the foundations of social economics in your business model.