Conversion
Ownership Bias
We value things more when we feel we own them
218 people were split into 3 groups, given either a coffee mug or a chocolate bar and told they could swap their item for the other; or given neither and told they could choose either.
Those who’d been endowed with either item were far more likely to stick with it than those who were given neither.
Perceived ownership is powerful, allowing consumers to attribute increased value and emotional connection on what you’re offering, creating a strong desire to buy that increases over time.
It’s driven by a price gap between how much we’re willing to pay for an item and the price we’re willing to sell it for. This is due to a mix of Loss Aversion, Framing (i.e. buyer or seller) and the evolutionary advantage of overvaluing our tradable possessions. Doing so increases our resources and chances of survival.
Allow people to feel ownership of a product prior to purchase. Examples include: making it effortless to add that product to their basket, visually personalizing a product early in the ordering process, highlighting how soon it could be at your door or allowing free week-long test drives of that car you’ve always wanted.
Conversion
Scarcity
We value things more when they’re in limited supply
There’s a reason this Nugget is #1 in our library.
The concept of Scarcity lies at the core of economics, and greatly influences perceptions of value, status and our competitive desire to attain certain items over others.
Unfortunately, it's also one of the more poorly-applied concepts out there, along with Defaults and Loss Aversion.
Mastering quantity scarcity
An airline stating that there's
“Only 3 seats left” may well be using accurate data and not simply using faux-scarcity to artificially suggest that there's less supply of seats than there actually is.
However, from the user's perspective, the buildup of mistrust around the use of scarcity means cynicism is higher, so one must be careful with information presented.
Similarly, hotel websites telling you that “30 other people are looking at this item” engineer stress to compel people into action without changing supply yet highlighting demand in a manipulative way.
Instead, use quantity scarcity to focus on the craft and high quality of what you're selling.
Make your scarcity feel valuable, not stressful.
Mastering time scarcity
Ensure that any time restriction is highlighted primarily for the purpose of maintaining the quality of your product or service, and not merely to cause stress that could be avoided.
As an example, use time scarcity to launch unique or experimental products that are only available within a particular window (say a week, month or season).
This use of time scarcity is positive and encourages brand exploration, used creatively to highlight your unique value.
There’s a reason this Nugget is #1 in our library.
The concept of Scarcity lies at the core of economics, and greatly influences perceptions of value, status and our competitive desire to attain certain items over others.
Unfortunately, it's also one of the more poorly-applied concepts out there, along with Defaults and Loss Aversion.
Mastering quantity scarcity
An airline stating that there's
“Only 3 seats left” may well be using accurate data and not simply using faux-scarcity to artificially suggest that there's less supply of seats than there actually is.
However, from the user's perspective, the buildup of mistrust around the use of scarcity means cynicism is higher, so one must be careful with information presented.
Similarly, hotel websites telling you that “30 other people are looking at this item” engineer stress to compel people into action without changing supply yet highlighting demand in a manipulative way.
Instead, use quantity scarcity to focus on the craft and high quality of what you're selling.
Make your scarcity feel valuable, not stressful.
Mastering time scarcity
Ensure that any time restriction is highlighted primarily for the purpose of maintaining the quality of your product or service, and not merely to cause stress that could be avoided.
As an example, use time scarcity to launch unique or experimental products that are only available within a particular window (say a week, month or season).
This use of time scarcity is positive and encourages brand exploration, used creatively to highlight your unique value.
146 people were asked to rate identical cookies that were either presented in a jar as scarce or in abundance. They were then asked how likely they would be to want to eat a further cookie.
When scarce, the cookies were rated as more desirable and having a higher value. They were also seen as more valuable when going from an abundant state to scarce than when always scarce.
Scarcity comes in 4 flavors:
Quantity, Time, Access & Rarity.
Control quantity.
To increase perceived value of your product, release it in smaller and diminishing quantities, emphasizing its finite nature.
Restrict time.
When the clock is ticking and we’re overwhelmed, we take mental shortcuts that speed up decision-making.
Motivate customers by emphasizing the limited time remaining in which to act.
Limit access.
Restricting access to your products or services will increase desire and perceived value. Do this selectively for certain features and / or customer segments.
For instance, you might want to design valuable, unique rewards that are only unlocked for very special efforts on the part of the customer.
