Sales & Marketing

Consumer psychology holds key to success for retail’s digital future

5 min read

06 January 2014

Online retail is one part of the economy that is really doing well. Indeed, the statistics show it is a substantial success story bringing in record business for firms like John Lewis.

Yet there are other retailers that are not doing so well online. Indeed, the Finance Director of Debenhams resigned following disappointing figures and a profits warning.

Some digital retailers seem to get it right, while others struggle. So what is the difference?

Retailers often talk about offerings, design and functions. But that focuses on the website and its mechanics. The companies that are doing well online focus at the other end of the relationship. They focus on their visitors and customers, relegating the website itself to the lesser part of the equation. In other words, the successful retailers focus on online customer behaviour, taking a psychological approach, rather than a technical one.

This is evident in online retailers such as ASOS who changed their strategy a few years ago. Their website has several psychological triggers which show their visitors they need to stay. The same is true for Next or John Lewis. These firms provide psychological signals that the visitor can interpret within seconds. Brain scanning research shows that website visitors make the decision as to whether to stay or to click away within 600 milliseconds.

Traditional retailers are used to having several minutes in which to engage their customers. Plus they can manipulate things like lighting, temperature and sound, to make the shopping experience more enticing. But online retailers have only seconds and they cannot manipulate those environmental factors that increase the likelihood of buying.

The successful online retailers have realised that they need to engage within seconds, rather than minutes. Whereas those who are not doing so well online are still thinking from the traditional retail perspective of having a comparatively long time with customers. The future of digital retail will belong to those companies that connect to their website visitors within seconds. The websites that take longer to engage will fade away – and that’s a real problem for traditional retailers facing decreasing footfall.

Getting their online offering right is fundamental to their entire success in the future.
So what have the successful companies realised about engaging online quickly? They have shown they realise that customer convenience is essential. Psychologically people want to do things with the least amount of effort, so complicated, menu-heavy sites are out – simple, easy-to-use sites are in.

Successful sites also demonstrate they like their customers by providing a sense of “this is for me”. The imagery and the wording means that customers identify with the site and feel it likes them. ASOS for instance found this so much easier to do when it focused on 20-somethings. Niche sites are going to be an increasing element of the future of digital retail because it helps instantly show likeability to website visitors.
Another psychological aspect of successful digital retail is minimising purchase risk. 

A human survival instinct is to reduce risk by getting as much information about something as is possible. Websites that only provide minimal information about products tend to sell less than sites with extensive information. Having large amounts of information about each product is going to be a significant factor in selling more online. 

Traditional retail provides a customised experience for shoppers. Displays provide exactly what people are looking for using themes so that items people do not want are not easily visible. Plus the shop assistants respond to what people say to provide a personal experience. Amazon customises its website for individuals as does John Lewis. People expect a customised online experience, in much the same way as they get one in real world stores.

Another psychological aspect of successful online retail is establishing trust. People equate knowledge with trust. A company that shows it is knowledgeable with, for instance, a regularly updated blog, helps customers think more positively about the website. The future of digital retail will see the successful shops adding large amounts of online content that is not sales oriented but shows topic expertise.

These five things – Convenience, Likeability, Informative, Customised and Knowledgeable – will help digital retailers CLICK with their customers.

Graham Jones is an Internet Psychologist and author of ‘Click.ology‘ published by Nicholas Brealey – £12.99.

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