8 Ways to convert high value purchases online

Understanding your customer journey is key to success. However, with an increasing number of touchpoints, understanding your audience is getting more and more difficult. It’s critical to know not just their interests and opinions, but also their habits, behaviours and interaction points in both the online and offline worlds. With big ticket items, such as expensive holidays and luxury cars, the customer journey is even more complex to comprehend. Consumers decisions on these items are processed differently to lower value items, people take more time over the decision, compare more alternatives and refer to many trusted sources for advice, but how do they make a decision? Do these sources really make a difference? What psychological tips and tricks can you employ to sell big ticket items to consumers?

Why are high ticket purchase decisions different?

Unlike lower value items, high cost purchases are more risky purchases for a number of reasons:

  • High price. They cost more so it takes more time to save up and pay for the item, consumers want to make sure their hard earned money is not wasted on a bad decision.
  • High risk. When it comes to experience purchases such as the annual family holiday or a honeymoon, there is a great deal of pressure on the person booking to ensure the experience is memorable and that everyone has a great time.
  • Longevity. A car will be something that’s used daily, for a number of hours and will remain in their life for a number of years.

68 days is the average time it takes users to research high ticket purchases

The fragmented but shortening customer journey

The customer journey in the digital era is no longer linear. With the rise of digital technologies and the connectedness that typifies the shopping experience, the costumer decision making process has become more fragmented.

However, the customer journey is also showing signs of shortening for high price items. Research over the last few years shows that consumers may be becoming more decisive. This may be because evidence indicates they are researching much earlier and spending much longer in this stage of the process. From 2013 to 2015, the average time taken in the research phase decreased by 14% for high cost purchases, from 79 days to 68 days (GE Capital Retail Bank and Synchrony Financial).

User experience in the digital world is no doubt contributing to this shortening timeline. The more that digital experiences, such as websites and apps, are designed around user needs, the more likely it is that the customer’s questions and concerns are answered and they’ll more likely reach the moment of truth. The key is ensuring that your website is the one to do this so that you keep the customer in your website as opposed to them going back to Google and a competitor to meet their needs. You need to identify and prevent all those barriers that can make people bounce, and work to actively keep them engaged with your product.

Rational and irrational decision making

“95% of our decisions are emotional, and 5% are rational. So even with all of these touch points we tend to go with our gut.” (Kahneman)

In the decision making process we think we are being very rational, researching the product, collecting information, comparing what’s included and prices, reading reviews, looking at photos and watching videos… but unbeknownst to consumers, their final decision to purchase is driven by emotions (irrational).

M.Talks of Ignition One states “We may be getting more decisive, but it doesn’t mean we’re getting any more loyal. Perhaps we’re just using all the information to filter down to a decision, but it’s still going to be an emotional decision. We’re not going to be any more [rational] about it… with some items we’re going to look at all the facts a bit more, but we’re still going to go with our emotional reaction to things. When it comes to marketing, it’s all about how you feel. If you don’t feel towards a certain brand, then you don’t want anything to do with it. You want to make sure you’re playing up all of your marketing campaigns to play into those emotions. The thing about the big-ticket items where you have to make a big financial commitment is that naturally, you want to make more time about that decision and have as many opportunities to verify your decision as possible. But our decisions are mostly driven by emotion rather than rational thought.”

Still likely to purchase in-store, despite their increased use of digital

88% are likely to purchase a high priced item in-store, not online. So, despite the increased use of digital throughout the customer journey, the final transaction is mostly still being made in a physical store.

8 ways to convert high ticket consumers online

1. Focus on mobile customer experience

With 50% of consumers using their mobile at some point during the research and purchase of a high ticket item, it’s more important than ever to focus on your mobile customer experience. Mobile is by far the most difficult platform for brands to get right due to the small screen space, so it’s worthwhile investing in expert help to focus on analysing your online user experience, identifying barriers and opportunities to engage and convert your consumers.

Mobile shopping CX

2 Limit choice

The potential for your consumers suffering from the paradox of choice increases the more options you give them and the less likely they are to make a choice. And when they do finally make a choice they’ll be less satisfied with it – this is called Buyers Remorse. This is what happens when you book your holiday then a week later see a better deal that you wish you’d booked instead.
Parados of choice

3 Have a clear call to action on each page

It’s important for you to guide your customer when they’re on your website. Have one clear call to action button for each page. If you need other buttons, make these secondary buttons by decreasing their visual appearance and enhancing the appearance of the primary button to clearly stand out on the page.

4 Use video

High consideration purchases are driven by emotions. “The richer the emotional content of a brand’s mental representation, the more likely the consumer will be a loyal user.” (Psychology Today). The best way for you to communicate emotion is through video.

5 Personalisation

People want to feel that their purchase is unique, tailored on their needs, something that makes them proud to show and tell others about. People enjoy the fun aspect of personalising their product to their needs. It’s an external reflection of themselves. It also enhances their commitment and likelihood to purchase – personalisation can deliver 5-10 times the ROI on marketing spend and increase sales by 10% or more (McKinsey, 2013).
Audi R8 personalisation

6 Post purchase experience

The final purchase decision, especially for expensive purchases can be followed by buyers remorse; Have I made the right decision? Is it the best product? Buyer’s remorse (or buyer’s regret) is the sense of regret a person feels after having made a purchase. It is frequently associated with expensive items or when when customers have made a choice from many different options. A feeling of self-doubt and remorse can emerge after the purchase process. To lessen the risk of buyers remorse, keep in touch with the customer after their purchase, reassuring them of the good decision they made to buy their product and the benefits it’s going to bring them. They will become a loyal customer. Also this goes without saying but ensure you send reminders to them to leave a review!

7 Giving meaningful context

Give context to your customers experience, make your product come alive in their eyes, giving meanings that are relevant and timely for them. In a study, international travellers were asked ‘How much would you pay for insurance that pays $100,000 in case of death for any reason?’ versus ‘How much would you pay for insurance that pays $100,000 in case of death in terror incident?’. Travellers were willing to pay more  in the second condition because of the time and context (the unfortunate questions were asked during a period in which the risk of terror attacks was high).

Context matters

8 Utilise Virtual Reality

To give customers the experience before purchasing. Car makers such as Audi are offering consumers virtual test drives that enable consumers to test drive their cars without the need to visit a showroom. This approach disrupts the standard customer journey of research then test drive, as consumers can fast track straight to the test drive before doing their research. Once consumers finally go for their real test drive it will feel like a familiar experience and remove some of the friction, resulting in a higher chance of purchase. Fashion retailers are already looking at how VR could help to ease changing room friction and queues and utilising technology such as smart mirrors.

Virtual reality

Other posts you may find interesting:

Using the Pareto Principle to improve your user experience
Call to Action Buttons: 5 Psychology tips to increase conversion

Fascinating insights: E-commerce expo day 1

This week we attended the London e-commerce expo to discover the latest statistics, technology and importantly, what’s predicted to be big in 2015. Here’s our write-up of the sessions we attended on day 1 (day 2 to come soon). What’s very clear is that mobile will be massive in 2015! New technology enabling more advanced tracking of customers offline and online will also pave the way for advanced data, customer engagement and retargeting across channels (more of this in our next blog post: day 2).

Driving Sales in a connected world

Tracy Yaverbaun, Facebook

facebook mobile
Mobile was a key theme in Tracy’s presentation. There has been a huge change in devices and multi-device use, for marketers this is a huge challenge!

Mobile is where the growth is and where it will continue to be but brands aren’t moving as fast as consumers.

Only 4% of budgets go into mobile but it’s where 20% of consumers time is. Everything has to work on mobile for facebook now.

80% of Facebook’s users are mobile. 26m daily users on facebook, out of these 23m are mobile .

Mobile is disrupting commerce. Physical shop real estate is shrinking so e-commerce is more important than ever. Yet the screen size is smaller so marketers have to work harder on the small screen real estate.

Consumers want msgs relevant to them at the right place at the right time. You need to consider:

1. Discovery. People can find your brand. The Facebook newsfeed is one of the best places for consumers to discover products. Most people check their newsfeed a whopping 14 times every day!

2. Personalisation. Personalisation at scale. E.g. Amazon used Facebook to only target people who didn’t own kindles and were frequent flyers (using their CRM to filter out people who had kindles). It’s all about ‘good targeting’.

3. Measurement. ROI no matter which device consumers start or end their journey. Mobile has a huge amount of traffic but a lot of brands discount this. Marketers are obsessed with looking at clicks but they don’t matter, what matters is return on investment. Even if people don’t click, they’ve seen your message and taken in your brand. Facebook now has cross device measurement capability.

The future of ecommerce is personalised discovery across devices and that you can measure every step along the way.

The future of mobile on the high street

Andrew McClelland and Matt Norbury

Future of mobile on the high street
What was very clear in this keynote, was that mobile is a huge, growing market and the key takeaway was that if you’re not focussed on mobile you are already getting left behind. Here are some of the key points:

Mobile growth is larger than tablet. 186% average growth in sales via mobile compared to 131% in tablet e-cmmerce. Average mobile conversion last year was 1.1%, this year 1.4%.

Basket size on mobiles is almost equal to desktop. £76 average basket value for mobile, average for desktop is £80.

8 in 10 smartphone users will use their smartphone at some point during the purchase process.

Mobile is critical to retail in the coming years. You have got to give people a real reason to engage – games and fun stuff. Add sufficient value that people keep coming back.

Don’t fear ‘showrooming’. Although people are using their mobiles inshore, most are actually just checking their email and social networks, not comparing prices.

Provide wifi. Wifi in-store is becoming a requisite – people expect it. Some people will leave a store if it doesn’t have wifi. Good for the guys whilst the girlfriend is shopping – keeps the boyfriend happier, keeps the girlfriend in the store for longer, everyones happy and the girlfriend has spent more.

Personalisation is big. 70% of people will give personal information and preferences to get something valuable in return such as offers.

Use beacons to measure footfall. Can measure uplift of message and conversion from a voucher you sent them. See the full end-to-end conversion, starting online, ending offline.

Five tips to make sure that customers transact with your app

David Pope, Jumio

Mobile commerce transactions

25% of downloaded apps are NEVER used.

Nearly 66% of consumers making purchases on a tablet or phone, regularly abandon their purchases during the payment process.

David explained his top five tips to get customers using and buying from your mobile app:

1. Be aware which operating system or platform will deliver the best return for your app. Interestingly, although Google Plays market share is way more than Apple’s, Apple’s users actually spend more – almost five times as much! ios users display 6 times the engagement of android users and tablets drive about 20% more spending on avg. Avg spending is 89 eur for tablets, 67 for pcs, 66 for smartphones. Although this isn’t the same in every industry and he specifically excluded travel and gaming as not applicable.

2. Be sensitive to data privacy concerns that may inhibit app usage. Trust is the number  barrier to growth of mobile content and commerce. 99% of users will not share their contact information. Less is more. Don’t ask for location, don’t ask how old the user is, don’t ask to access their contacts – greed for data gets in the way of transactions.

3. Reduce payment friction. This is all about your User Experience. David specifically talked about the keystroke level model – timing how long it will take customer to type data into your forms and working to reduce this number. And the gestalt laws of grouping (this is a more general design rule). Quite rightly, he pointed out that lots of apps still show alphanumeric keyboards for numeric data input – this is really frustrating and time consuming for your users. He also spoke of form length as important for reducing friction and gave the example of one change reduced to just 4 fields that resulted in 160% increase in conversions.

4. Balance functionality with speed and performance. There is a direct link between the performance of an app, number of downloads and its rankings in the app store. Tagman widget for calculating performance optimisation for your app. David recommends taking an MVP approach.

5. Build customer retention into your app. Integrate social features e.g. Sephora. Create a sense of community and use timely reminders, e.g. Map my run. Promote the benefits of your app, e.g. Swiftkey, tells you how much time you saved compare to normal keyboard. Personalise your customers experience.

Jumio
David’s aim in describing the above, was in promoting his product, Jumio. Basically instead of typing in their details, your customer would use Jumio on their mobile to scan their credit card and all the fields on your form would be populated automatically (Fastfill). Apparently this aids validation and reduces fraud. Note, legally, the customer still needs to manually enter their CVC number. It’s claimed that the average increase in form completion rate is 18-33%, coupled with less data entry errors.

Watch the video:

The customer journey report 2014

Dave Chaffey, Smart Insights

Dave’s slides can be viewed below. He placed focus on the customer journey and how wide it actually is – you need to focus on all channels, both online and offline and how people interact with / switch between them. It’s also important to use the right language for each of your personas to appeal to them in the words they use.

It was fairly disappointing to see that only 33% of respondents in the survey make use of usability studies but I’d be willing to bet that these 33% are the more successful companies. Clearly, there are a lot of companies that need to make greater use of user research methods as opposed to just analysing numbers.

Beware of the box: Don’t let your commerce software dictate how your business works

David Winterbottom

David’s presentation was from  a more technical viewpoint, being from a developer background originally. I loved his approach to writing software requirements which is called YAGNI (You ain’t gonna need it). We often experience feature / scope creep in our UX world and we’re always battling against it, so YAGNI is definitely an acronym I’m going to be using! Quite rightly, David also advised that companies shouldn’t write a long list of software requirements at the RFP phase as this should be open at this stage to allow the company you work with to come up with the best solution, otherwise you’re already limiting them and telling them the solution.

I also liked the example that in Korea, customers can now scan QR codes to purchase things in the store. Soon, you’ll also be able to have your items delivered so that they’re waiting for you when you get back home (very cool).

David spoke briefly about an open source platform they’ve created called ‘Oscar‘. It’s totally free, designer friendly (apparently), and mobile by default. It’s built in Django and quick for prototyping which David said can be done in just a few days.

Read part 2 : More fascinating e-commerce insights for 2015!