Do you remember the last time you really wanted a burger? Did you end up getting the fries and the drinks too because they were offered as a suggestion? If the answer is yes, then you were successfully nudged into making this decision. Although quite basic, it is one of the most common examples of the nudge theory, a behavioral science concept introduced in 2008 by Richard H. Thaler and Cass R. Sunstein.
Nudging does not only happen at your nearest burger shack though, it happens all around us. People take unpredictable actions every day, a lot of the time it is not the ones that were planned by organizations or the government. That’s where Service Design often comes into play. Service designers work with the intention to understand, predict and influence behavior and frequently need to assess methods of nudging. By incorporating behavioral interventions into channels and processes and using methods of nudging, they can help people make more desirable decisions; for themselves, for service providers, and for the society. Someone implementing nudging techniques is also often referred to as a choice designer or choice architect.
Today it is common to see behavioral economics theories and principles of nudging being translated into e-commerce spaces. Digital choice architects have higher degrees of freedom as they can theoretically modify every element of digital platforms, like websites or apps. In the design of user interfaces, digital choice architects use the opportunity to influence their customers’ online behaviors by applying nudging techniques as a way of enhancing the user experience and pushing the customer in the right direction. Implementing the right nudging techniques can make or break an e-commerce business, and here are some of the most common ones.
Scarcity and the fear of missing out
One of the most known techniques for e-commerce businesses is incorporating elements of Fear of missing out (FOMO) throughout the user journey. FOMO stems from psychological concepts, such as loss aversion, commonly used in neuromarketing. Losses, on a psychological level, are twice as powerful as the effect of gains. Our brain will do whatever it takes to not lose, even if it means missing out on winning. Some ways to use FOMO for e-commerce is by having a countdown during a sale, letting the website visitor know how many people are currently looking at a product, or labeling limited edition products.
Social proof and customer feedback
In times of uncertainty, individuals often follow the behavior of others to help them make decisions, which is also known as the persuasion techniques of social proof. In e-commerce, it is becoming increasingly common to show customer reviews or feedback for products to nudge potential customers into making a purchase decision. Customers do not have to rely only on the advertisers message, but can consider other buyers’ opinions too. If we see that others have been happy with a product, it may be the last little push we need to make a purchase.
Nudging into exploration
In a physical shop, you might be assisted by a salesperson that would suggest a certain product from another category because of its relation to the product you are trying or looking at, also known as cross-selling. In e-commerce, this is usually displayed under “Frequently bought together” or “Other customers viewed”-sections. Letting customers know what other people buy can be a trigger for inspiration or nudge the website visitor to keep exploring more from other categories.
Authority and pre-selection
An effective nudging technique is pre-selection, where the choice architect makes the desired behavior the default. We often perceive the preselection as a recommendation. An example is when you visually highlight one of several options, such as the most popular product. Our brain is wired to be efficient, so it uses visual and mental cues to help make decisions as automated as possible. Now you do not have to make an active choice any longer if you do not want to, all you have to do is click the buy button. Highlighting products can also be done in a way to showcase authority, by labeling products as being recommended by the brand, its designers, or producers.
The ethics of nudging
In behavioral economics, nudge policies were created to try to improve people’s decisions by changing the ways options are presented to them. It was aimed to be used to create positive change. But nudging has also received criticism, based on the belief that it can undermine freedom of choice, that our choices do not reflect our own autonomous desires and therefore our actions are not genuinely our own. Nudging has been called out as condescending and infantilizing.
In order to make nudging as ethical as possible in the e-commerce space, one should consider certain aspects when applying nudging techniques. Since digital choice architects have more freedom of choice, their responsibility comes with designing nudge interventions in a non-exploitative, non-prohibiting, and choice-preserving way. As an example, the consumer should be able to identify the nudging intervention with a basic level of attention. In addition, the goal of the choice architect and the end-user should align as much as possible. The nudge should not have the intention to steer the user into a direction that is not aligned with the user’s end goal. This ethical consideration can become problematic for businesses that have a wide range of products and services and users with different goals. However, in contrast to offline nudging, digital choice architects can work with targeting, differentiation, and personalization, and thereby have a better chance to align the nudge with the end goals of the users.
Although nudging is an old practice, its occurrence is widespread in e-commerce today. It is therefore of importance for digital businesses to understand their users and their behaviors to implement responsible nudging techniques that can have a long-lasting impact. Choice architects should already include ethical considerations into their conceptualization and design phases in order to avoid ethically unsound nudges right from the start.