Conversion
Default Effect
We tend to accept the option pre-chosen for us
Faced with a set of options, when we’re not sure what’s the “right” choice, Defaults offer a helpful guide.
They help people avoid expending vast amounts of cognitive energy to decide between what could be a large number of options.
This is especially the case for those who don’t know much about the products or services, where Default options can take away the fear of getting that first decision wrong.
They're also a powerful remedy to any potential Analysis Paralysis, and are particularly helpful when making multiple choices one after the other.
Consider that you’re buying a computer, with a range of possible customisations to various parts.
If there were no default choices set, we’d quickly become overwhelmed with what was the right choice in each step.
If you have complicated product ranges or customisations, are you setting helpful Defaults? If you are, think hard about whether these need improving to reduce effort further.
But also, a word of warning.
Defaults can be terribly misused to force people into decisions that they don’t want.
Take people down the wrong path and you’ll quickly trigger Reactance; an angry feeling where people will want to reclaim their independence, often doing the opposite of what you Default them to.
Ensure that your Defaults have peoples’ own intentions in mind and don’t deviate too far from what people would do of their own choosing.
What Defaults are you setting? How can these be improved to help smooth out decision-making and guide people to better outcomes, either for themselves (e.g. helping them save more money) or for the wider group (e.g. defaulting meeting times to 15 minutes instead of 30).
Defaults are set everywhere. They’re powerful and have a big influence on behavior with little effort.
Faced with a set of options, when we’re not sure what’s the “right” choice, Defaults offer a helpful guide.
They help people avoid expending vast amounts of cognitive energy to decide between what could be a large number of options.
This is especially the case for those who don’t know much about the products or services, where Default options can take away the fear of getting that first decision wrong.
They're also a powerful remedy to any potential Analysis Paralysis, and are particularly helpful when making multiple choices one after the other.
Consider that you’re buying a computer, with a range of possible customisations to various parts.
If there were no default choices set, we’d quickly become overwhelmed with what was the right choice in each step.
If you have complicated product ranges or customisations, are you setting helpful Defaults? If you are, think hard about whether these need improving to reduce effort further.
But also, a word of warning.
Defaults can be terribly misused to force people into decisions that they don’t want.
Take people down the wrong path and you’ll quickly trigger Reactance; an angry feeling where people will want to reclaim their independence, often doing the opposite of what you Default them to.
Ensure that your Defaults have peoples’ own intentions in mind and don’t deviate too far from what people would do of their own choosing.
What Defaults are you setting? How can these be improved to help smooth out decision-making and guide people to better outcomes, either for themselves (e.g. helping them save more money) or for the wider group (e.g. defaulting meeting times to 15 minutes instead of 30).
Defaults are set everywhere. They’re powerful and have a big influence on behavior with little effort.
161 people were told that they’d just moved to a new US state and that here, the default was (or wasn’t) to be an organ donor. They were then asked to accept or change this donation status.
Results showed that only 42% donated when the default was to opt out, but 82% when defaulted to opt in.
Defaults are powerful. They’re chosen because consumers take mental shortcuts (especially when tired) and because there’s implied trust that they’re the ‘right’ choice. Defaults also act as a reference point against better or worse options. (Dinner et al., 2011).
Defaults can be set around anything: from the standard package you offer to new subscribers, to the pre-set top-up amount for your mobile wallet, to whether each order of pizza should come with salad. Each default can dramatically affect conversion levels and behavior.
Get the balance. Ensure your defaults feel natural and in line with consumer aspirations. The more extreme the default you set (i.e. defaulting to the most expensive option), the more effort consumers will expend weighing up the cognitive / emotional costs of not choosing the default, impacting their experience and reducing overall trust.
Product Development
Risk Aversion
We don’t like uncertainty and generally stick to what we know
11k people were offered a new job that had a 50% chance of doubling income for life, but it wasn't without risk, with an equal chance of it falling by either 20, 33 or 50%. Questioning started with the 33% gamble; if people took it, they were asked if they’d take the bigger 50% gamble too. But if they didn’t, they were asked about the smaller 20% one.
Results put people into four risk categories showing the majority were not willing to take any risk at all.
Focus on an improvement metric.
We prefer the certainty of what we’re used to, so the benefits of switching to a new product need to feel substantial.
Outline a goal (relative performance, efficiency etc.) to anchor your product strategy around.
Doing so will reduce uncertainty and boost comparisons against better-known, lower risk alternatives.
Offer a trial or free sample...
...to create familiarity and reduce the risk around a new product.
This sets the cost of new product usage at zero, during which the consumer will adjust their future preferences.
Utilize your brand umbrella.
For any new sub-brands, reduce risk by clearly indicating the relationship to existing, familiar brands you own (Erdem, 1998).
Product brands take note. Risk aversion is higher for material purchases than for experiential ones such as restaurant meals or holidays (Roche et al., 2015).