insights! episode #19: digital nudging in e-commerce - how user behaviour can be guided in the online shop

Joubin Rahimi:
Great to have you back for a new episode of Insights. My name is Joubin Rahimi and today's guest is Katja Moritz. Hi, Katja.

Katja Moritz:
Hi, Joubin.

Joubin Rahimi:
Yes, tell us maybe one or two sentences about yourself before we get into the topic I haven't revealed yet.

Katja Moritz:
Sure. Hi, I'm Katja. I'm User Experience Manager at brytes. That means I'm in close contact with our customers, who are all shop operators. And together we consider how we can improve their shops. We provide recommendations for action, derive the need for action from the data, and then develop concrete things that we can implement for our customers to improve their shops.

Joubin Rahimi:
And we've already posted a video, or an interview, on the topic of digital body language. We'll link that, of course, so you can take a look at it beforehand as well, in case you're missing one or two basics for today. Today isn't about the topic of digital body language, it's about the topic of how do I get, so to speak, the trigger, the advert to the person, so that they do something we hope they'll do, such as completing a purchase and so on. That has a nice name, "nudging" or in this case "digital nudging". But what exactly is that? I've described it now in very simple terms.

Katja Moritz:
Just throwing words in. So behind nudging basically stands the principle of nudging, nudging in the right direction. This direction is, of course, especially in e-commerce from the seller's perspective, meaning the shop operator, that they want to nudge the customer towards a purchase. But the principle applies regardless of whether it happens online or offline in the first place. We probably experience this several times a day offline too, and maybe don't even notice. It could be, for example, that the fruit basket in the office is free, and next to it there are chocolate bars that cost one euro. With that, the employer naturally wants to encourage healthy behaviour first, and then enables the free fruit basket as it were. You always have the option to decide differently, too. That's a really important part of nudging. So nobody is forced to do anything, you're really just given a recommendation in a certain direction. But you never actually have to take that direction either.

Joubin Rahimi:
The decision there is simple, really, fruit or I have to spend a bit of money. That's already the barrier. Do I have money with me or not? Then I'll just take the banana or the apple. It's a decision that might no longer be rational, or would be made rationally differently, if you didn't have that. Maybe you can address that. Do you move the person over a threshold and force them? Even if you just said you don't force them. What's behind that?

Katja Moritz:
Basically you can first look at human behaviour. How do we decide? How do we make decisions? And for a long time people went on the principle of Homo oeconomicus, the rationally acting human, entirely focused on utility maximisation. That was a concept for a long time, but by now it's rather outdated, because there are simply so many influences acting on us daily, which affect our decisions and can steer them in certain directions. And those are basically behavioural principles that people simply display. And nudging, or digital nudging too, uses these behavioural principles to then steer customers in certain directions. And these behavioural principles are basically the explanation for why certain things work, which are used above all in advertising.

Joubin Rahimi:
And actually, this isn't so bad. I'm a cyclist, as the dear listeners know. And for example, I find a Cube or a Canyon totally great, because they're modern in terms of company structure, that has nothing to do with cycling. Because they come from Germany, that also has nothing to do with the bike. And then an American Cannondale isn't my brand. Doesn't matter really, because de facto I don't really ride faster or slower with one bike or the other. So you're not really doing anything bad. That's what I'm getting at, you create options. The question I ask myself is, when you have this option, and some are totally simple, like an offer with fruit or the green cookie, I accept all cookies button. What other mechanisms are there?

Katja Moritz:
There are hundreds of behavioural principles you can use there. As you're just saying, you're not forcing anyone. Theoretically you could do that. There really are behavioural principles that go in the direction of dark patterns. That means shops use these principles and these applications not to support the customer's actual interest, which is what nudging actually tries to do, that's basically the positive effect of it. Instead they use these dark patterns to act against the customer's interests and force them into something, or strongly pressure them. That could be, for example, you want to unsubscribe from some account, want to delete it, and this process is made incredibly difficult for you. It's not simply possible in the account, instead you first have to write to support and then they send you something and then you have to send something else by post. Those are simply huge processes behind it. So that exists as an option too. But generally nudging tends to be used to support positive things, so to strengthen your own interests.

Joubin Rahimi:
Is there a code, or digital code, of what's okay and what's not okay?

Katja Moritz:
That's something every shop basically has to decide for itself, do we want to make use of that? At brytes we definitely don't. We want to positively reinforce behaviour and interests. But we would never force anyone to do something they don't actually want to do, or act against their interests. Because we're also convinced that as a user you notice that. If I as a user am forced into something I don't actually want, or after a purchase I have the feeling I was somehow talked into it, then I won't shop again in that shop, and as a user I won't feel comfortable going to that site again either. And that's of course really the worst thing that could happen to us. We want people to be satisfied with their decision, satisfied with their products, make the right choice, and then come back at some point.

Joubin Rahimi:
Now I'll give an example. Hope I get it right. This was in America, in a cinema. In the film, very short sequences of a soft drink were flashed in. And where it was flashed in, desire for that brand was clearly higher than where it wasn't. And people couldn't remember seeing it, because it was so brief. I'd file that under dark pattern. Dark pattern you don't notice. In the digital environment, I find it hard to imagine something like that being possible. That'd be the first question. Every shop operator can of course do things for themselves to a certain degree. But is there something like a moral compass or an ethical baseline? Is there a red line where you'd say, beyond that it's too much, that's where it turns bad? That's three questions at once. But let's start with one: is there something like this cinema example in the digital environment too, or a study on it?

Katja Moritz:
This cinema example show images spark your nerve cells, your biological processes in body, and then you, cause you see this cold drink, get craving for it, cause you think, sugar always give me boost, great, need one now! Course they work with basic human needs there, needs that then get satisfied. Now second question, how do you actually implement this online? You just build huge hurdles for people to unsubscribe from process. Could mean you design whole thing bit opaque. Could mean charges don't come from app itself, if you got app on phone, but get forwarded via mobile carrier or through some intermediary accounts. So on your account you see charge of five euros at end, but can't directly link it to app. Such lack of transparency can then be used so you don't even think about unsubscribing in first place.

Joubin Rahimi:
Something like that gets used quite often, I think. When I think about it, what was that? Ah, that was that. What are some positive areas where you'd say, that can be done? This digital nudging, one or two examples. Those are positive things that help every shop operator, that really leave a choice and don't force anyone to eventually send a letter or fax, along the lines of, we only accept fax or handwritten cancellations, ideally signed with a fountain pen too.

Katja Moritz:
It's very varied how you can apply these principles. As an example, I could take framing. The way you present information can influence how you perceive it and then how you ultimately evaluate it for yourself. That means if you perhaps offer several options and display one a bit larger, because that's the one that sells most, and then add underneath that it's our bestseller, the most popular product. There you've probably already got five to ten principles in that one example alone. But you can use those to highlight certain characteristics in a very simple way. That means the user who lands on the page feels confirmed on one hand, thinking I can't go far wrong with this, others like it too, it must work if so many people also like it and use it often. And in this example you always have the option of choosing other options too. So maybe something cheaper or something more expensive. But it's already quite clear what the intended direction is. You can also work a lot with colours here. You just mentioned it, the cookie banner, the accept button or a newsletter sign-up in green. Green is always something positive for us – traffic light is red, stop, traffic light is green, we're allowed to go. So we associate this colour with something positive rather than warning signals. And that's why the newsletter might be subscribed to more often if the sign-up button is displayed in green.

Joubin Rahimi:
Thanks for that, then I've got another question, away from newsletters, towards complex things like a car configurator: I've noticed manufacturers are changing a lot right now. With Volvo, there are now only certain broad packages, and then you can choose colour and wheels, three or four other things, and that's it. So they're radically simplifying that process. Tesla too, for example. German manufacturers, especially Audi, BMW, Mercedes, have lists like a tax reform bill – pretty long, and the combinations are complex too, so you always needed to study them. But now they're starting to say: these are the top sellers recommended for you. And I find that incredibly interesting, because they're doing something to you there too. Is that nudging already, or are those other principles?

Katja Moritz:
Do you have option to decide differently?

Joubin Rahimi:
Always, yes.

Katja Moritz:
Okay, well then ...

Joubin Rahimi:
...then it's nudging, like with the fruit.

Katja Moritz:
Yes, you might always have some kind of cost in some form, whether that's the euro for the chocolate bar or simply the time you invest in engaging with certain other combinations. But since you always have the choice and essentially only one option is highlighted, it's basically nudging.

Joubin Rahimi:
Nudging is already everywhere in the digital environment. You just have to recognise it. And as a shop operator, can I also know how to use that for myself? Are there differences by personality type in how I should nudge?

Katja Moritz:
Absolutely. So someone who's perhaps very price-sensitive, you can point them towards filters that narrow down the price range, that maybe highlight products in the sale section. And someone who's shopping in a more goal-directed way, you should perhaps just leave alone, because that would rather distract them from achieving their actual goal of buying a product. It's definitely important to use nudges in a targeted way for specific customer groups, so as not to overwhelm them or oversimplify things for them. And you really have to look closely at what customers you have in your shop, how they're currently behaving in that specific situation, and how you can then help them along.

Joubin Rahimi:
Great. Speaking of helping further, maybe you have another anecdote, a story for our listeners, so they can say, that's something to take away, that's probably easy to implement. A valuable story from your work or the work of your colleagues.

Katja Moritz:
What's definitely highly recommended is highlighting good products. That means a good product can be one that's purchased particularly often, that's rated particularly well. And creating transparency around that too. If, for example, you display a note saying this product is valuable in some way, as a user I might not know, is that even my evaluation criterion? Example: I want to book a hotel and I look at reviews. Some users give just one star and write the car parks are absolutely awful and miles away. But that might not be relevant to me at that moment. And because I can see these other reviews and the transparency is there, I can judge for myself, is this something meaningful for me specifically? If I exclude these reviews because I'm not driving to the hotel at all, then maybe I'm left with only positive reviews. So it's important to present these dimensions too. In what respect is it special? Is it really viewed particularly often? Is it purchased particularly often? Is it returned particularly rarely? It's important to present this transparency there too, so the user can decide for themselves, is this really an aspect that matters to me personally?

Joubin Rahimi:
Great. Thanks. I hope that helped not just me but you too. If you have questions about your shop or nudging ideas, feel free to drop a comment below or send us a direct message. We're both looking forward to having you with us again next session!