Online Consumer Behaviour
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Online consumer behaviour Interactive and Digital Marketing 5th of December 2014 Dr Lukasz Piwek
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Guest lecture for 'Interactive and Digital Marketing' 3rd year module at the University of West of England (UWE), Bristol on 5th of December 2014.
Transcript of Online Consumer Behaviour
Online consumer behaviour
Interactive and Digital Marketing 5th of December 2014
Dr Lukasz Piwek
AVERAGE SPEND FOR XMAS GIFTS IN UK (2014)
£350highest in European Union
PROPORTION OF CONSUMERS PUT IN DEBT AFTER LAST XMAS IN UK (2014)
14%second highest in European Union (average 9%)
ibtimes.co.uk
vs
vs
vs
RESOLUTIONS ENDING IN FAILURE
88%(Wiseman, 2007)
ego depletion
resisting temptation !takes considerable effort and energy!and after some time !our capacity to resist is exhausted!leading to
(Baumaister et al, 1998)
complexity of consumer decisions !can result in ego depletion!
depleted consumers !are more likely to become passive!
and make more impulsive decisions !that may not fall in line with their true values
Baumaister et al (2005)
if you’re ego depleted!you’re more likely to be !selfish!use sexist language!make superficial judgements
Muraven et al (2003) Baumaister et al (2005)
Gaillot et al (2007)
judges grant more parole !in the morning !and just after lunchtime
Danziger et al (2011)
fox.com
behaviour economicswith quick introduction to:!
ego depletion!dual process theory!
priming!illusion of validity
behaviour economics“we are not always rational, !and we often make mistakes”!we are susceptible to influences!from our immediate environment,!irrelevant emotions, stereotypes,!beliefs, norms, and many other factors
wordpressphoto.org
13 x 24
system 1
system 2
automatic & unconscious rapid & low effort recognition, perception, orientation nonverbal
control & conscious slow & high effort rule following, comparison complex computations linked to language
13 x 24
Dual process theory Stanovich & West (2000)
primingimplicit (automatic) memory effect !in which exposure to one stimulus!influences a response !to another stimulus
florida!forgetful!
bald!gray!
wrinkles
exercising!rapidly!send!typical!clears
Bargh et al. (2000)
priming people with money!makes them more selfishVochs (2006)
support to increase !funding for schools !is higher !if voting takes place in schoolsBerger et al. (2008)
people litter less in the train!if there is a smell !of cleaning productDe Lange et al (2012)
women who were exposed !to flowers!perceived the man!to be more attractive!and sexierGueguen (2011)
more donation made !when word ‘love’!was added to messageGueguen (2011)
children consumed !45% more food !when exposed to !food advertising in cartoonsHarris et al (2009)
illusion of validityor illusion of skillwith example being!
stock traders
shares sold by traders!did better !than those they bought!by 3.2% per yearBarber & Odean (2002) based on 10,000 accounts and 163,000 stock trades
most active traders !had poorest results, !while the investors !who traded the least !earned the highest returnsBarber & Odean (2002) Trading is Hazardous to your Wealth
the men acted !on their useless ideas for trading!significantly more often !than women, !and as a consequence !women achieved !better results in trading !than menBarber & Odean (2006) Boys Will Be Boys
rifenews.com
entertainment shopping!
travel!work
online consumption changed our habits in
mobile!is the new !shop window
NUMBER OF CONSUMERS USING THEIR SMARTPHONE WHILE SHOPPING IN-STORE
70%
NUMBER OF CONSUMERS WHO CALL OR VISIT A BUSINESS AFTER LOOKING FOR LOCAL INFO ON THEIR PHONE
77%
(2013)
(2012)
consumers!co-create!
advertising!and branding
MORE VIDEOS UPLOADED TO
every 60 daysthan the top three broadcasters produced
in 60 years
(2014)
ONLINE VIDEO ADS RECEIVED
18.3%more viewer attention than TV commercials
(2012)
digital traces of!online behaviour!
search!click!view!like!
share!follow!
save
FOR $27* YOU CAN BUY
25010005000
likesfollowersviews
*boostlikes.com (2014)
TOP 10 ONLINE RETAILERS in UK, according to D&W (2014)
$160 bln
Value of goods sold in the last quarter of 2012
$150 bln +
kbcb.com (2013)
physical retail!is very alive!and kicking
retaileconomics.co.uk (2014)
20% in fashion
50% in electronics
CONVERSION RATES FROM GOING TO REAL STORE TO BUYING SOMETHING
95% in groceries
Experian (2014)
CONVERSION RATES FROM GOING TO WEBSITE TO BUYING SOMETHING
1-5%Experian (2014)
AVERAGE NUMBER OF ONLINE CUSTOMERS WHO ABANDON THEIR SHOPPING CART
68%Experian (2014)
online/offline split!no longer matters
online experience in offline retail
Apple
online experience in offline retail
Burberry
digital payment models
The amount it costs the United States Mint to produce 1 cent coin
1.6 cents US Mint (2014)
wearable technology!augmented reality
blippar.com
wearable technology!augmented reality
blippar.com
new delivery models
DHL
consumer “data science”
other innovations!augmented packaging!
intelligent displays and shelves!radical transparency!
online viral advertising!consumer-driven advertising!
crowdfunding
examples of persuasive messages!in campus !
or on your favourite websites!twit image and description to
or e-mail to
online!persuasion !
strategieswith examples related to!
Cialdini’s social influence!Fogg’s persuasive technology
judgement heuristics!are mental shortcuts!we employ in making!
our everyday judgementsKahneman et al (1982)
Ashmore et al (1971) Worchel (1992) Cialdini (2001)
scarcity a perceived limitation of resources will generate demand
scarce items are perceived as !higher in value!
and more attractive !especially if we compete for them
metro.co.uk
ibtimes.co.uk
Ashmore et al (1971) Worchel (1992)
scarcity a perceived limitation of resources will generate demand
example!nightclub queue!“deadline tactic”
scarcity a perceived limitation of resources will generate demand
reciprocity people tend to return a favour
we may feel in debt !by getting uninvited favour !
small initial favour !can produce obligation to agree !
to much larger return favour Pease & Gilin (2000)
reciprocity people tend to return a favour
examples!mail appeal for donation:!18% success - mail only!
35% success - mail + gift!free sample in supermarket
Cialdini (2001) Wasko et al (2005)
reciprocity people tend to return a favour
Amount Twitter makes each time you look at your feed
$0.0008
reciprocity people tend to return a favour
commitment!consistency
people don’t like to be self-contradictory
Cialdini (2001)
example!“throwing a low-ball” in car sales!
by adding “surprise” costs !at the end of transaction !after initial agreements,!
and test drives
commitment!consistency
people don’t like to be self-contradictory
Provine (2000) Nosanchuk & Lightstone (1974)
Darley & Lantane (1968)
social proof people will be more open to things they see others doing
example!“canned laughter” in a comedy!
makes audience !laugh longer and more often,!
rate material as funnier!especially effective for poor jokes!
bystander effect
social proof people will be more open to things they see others doing
Average industry profit per commercial-flight passenger
$4
liking people are more easily swayed by people they like
Langlois et al (2000) Berscheider & Walster (1978)
attractiveness!attractive individuals are perceived as
talented, kind, honest, intelligent!similarity!
even small similarities!produce positive impression!
compliments!good cop/bad cop
liking people are more easily swayed by people they like
personalised & timed suggestions
personalised & timed suggestions
personalised & timed suggestions
scarcity
one-click choice
easy commitment!reduction & simplifying!higher motivation to engage!reduced cognitive effort!quicker goal achievement !& quick decision !can be rewarding!(but also regrettable)Fogg (1998) Bandura (1997) Desphande et al (1983)
