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Apply behavioral sciences into your e-commerce site and increase conversion rates. Learn how do online shoppers think and discover the exciting field of behavioral economics.
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By Omri YacubovichHead of Biz Dev & Marketing @Commerce Sciences
17 Slides on:
How do online shoppers think?Behavioral concepts any retailer should learn
Online Shoppers Behavior
Introduction
A
Http://Startupblog.co.il
Conversino optimisation for ecommerce site. Increase your ROI by applying behavioral science into e-commerce. Offer targeted real-time offers and increase sales
Hi,
My name is Omri Yacubovich. I'm an Israeli entrepreneur, script writer and innovation leader.
I'm currently heading the Business Development and Marketing @ Commerce Sciences –the first to apply behavioral science into E-Commerce. We are venture backed by Google's Chairman, Eric Schmidt, delivering significant conversion uplift for 1000+ online retailers including US Top 100 retailers.
Keep in touch!
About me
twitter.com/Omri_YacubovichFollow me on facebookConnect with me
f
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Introduction
if (humans are rational) and (free to make decisions) then rational decisions are made
Common Belief
If our prices are always low, as they would if we offer coupons, we can dismiss coupons
In J. C. Penney's words
WRONG!
WRONG!
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Introduction
1+1 = 2
1+1 = 11
Mathematics and Decision Making
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Introduction
There are some factors that affect decision making abilities and cause people to make
irrational decisions -Wikipedia
“
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Introduction
How do we make decisions?
Imagine that every time you cross the road, you would have to calculate the cars driving speed, your walking speed, the length of the road etc.
How much time would it take to cross the road? Would you be able to cross the road at all?
A car goes from point A to point B, at a rate of 57 mph...
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Introduction
How do we make decisions?
Instead of taking into account all the relevant data, our brain uses heuristics in order to make a decision.
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Introduction
heuristics are simple, efficient rules which people often use to form judgments and make decisions” -Wikipedia
“
HeuristicsDefinition
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Introduction
Heuristics usually give reasonably good results
quickly & easily
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Introduction
But there are some hidden traps - behavioral biasesMany of these biases affect belief formation, business and economic decisions, and human behavior in general
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Introduction
A cognitive bias is a pattern of deviation in judgment, whereby inferences of other people and situations may be drawn in an illogical fashion.” -Wikipedia
Cognitive BiasDefinition
“
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Introduction
Common Cognitive Biases
Framing effect Anchoring Availability heuristic Reactance
Zero-risk bias Ownership bias
Loss aversion
Omission bias
Distinction bias
Duration neglect
Illusion of control
Bandwagon effect
Gambler's fallacy
Stereotyping
Information bias
Less-is-better effect
Confirmation bias
Pseudo-certainty effect
Introduction
the tendency to rely too heavily, or "anchor," on one trait or piece of information when making decisions.” -Wikipedia
AnchoringDefinition
“
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Introduction
AnchoringExample
According to Nobel Prize awarded economic and psychological researches (Kahneman & Tversky) , when people have uncertainty about the price of a product, they often look for information from surrounding offerings and willing to pay higher prices when "anchored" by an higher price.
Kindle offer in Amazon.com:
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Introduction
AnchoringExample
When people receive discount they are automatically “anchored” to the price before reduction.
What's more appealing?
Product A Product B
$21.10Save 20%
$26.99 $21.10
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Introduction
a tendency to prefer the complete elimination of a risk even when alternative options produce a greater reduction in risk (overall).” -Wikipedia
Zero risk biasDefinition
“
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Introduction
Think QuicklyChoose between a FREE $20 coupon to Apple store, or a $30 coupon for eight dollars.
Which one would prefer to get?
FREE $20 Coupon
$30Coupon
Get Free Coupon Buy for $8
Or
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Introduction
Zero Risk BiasExample – Soap.com homepage
The FREE offer is more valuable than offering the a few dollars discount, equivalent to the delivery price.
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By Omri YacubovichHead of Biz Dev & Marketing @Commerce Sciences
17 Slides on:
How do online shoppers think?Behavioral concepts any retailer should learn
Online Shoppers Behavior
Introduction
A