When it comes to influencing consumer behavior, nudge marketing is a subtle method. It allows you to guide shoppers toward a decision by using prompts and cues that are likely to appeal to them. If you run an ecommerce store, website, or retail establishment, nudge marketing can be a handy tool to guide customers to make specific decisions.
What is nudge marketing?
Nudge marketing is a strategy that uses indirect and direct prompts to influence customer behavior and choices. Nudge marketing techniques work as suggestions, guiding consumers toward desired outcomes while letting them feel like they’re in the driver’s seat.
Nudge marketing comes from nudge theory, a behavioral economics concept that suggests subtle changes in environment and design can guide people toward a particular decision. Popularized by economists Richard H. Thaler and Cass R. Sunstein, nudge theory has become a part of marketing psychology. Retailers use nudge marketing techniques widely to encourage desired behavior in consumers.
You can build nudge marketing into the design of your ecommerce store with tools as simple as a clearance sale or a loyalty program. These marketing techniques nudge consumers toward purchases, leading to increased sales and a smooth shopping experience for customers.
How does nudge marketing work?
Nudge marketing often involves visual cues to encourage the customer to spend more time and more money than they might otherwise. According to economists Richard H. Thaler and Cass R. Sunstein in their book Nudge, “To count as a mere nudge, the intervention must be easy and cheap to avoid. Nudges are not mandates. Putting the fruit at eye level counts as a nudge. Banning junk food does not.”
Nudge marketing works by using what we know about consumer behavior to create a sales environment to facilitate the decision-making process. According to behavioral economics studies, most people act predictably when confronted with choices: Research into purchase behavior shows people prefer to select a simple default option. When confronted with too many unfamiliar options, the cognitive load on the consumer is overwhelming, and they may fail to make a decision at all.
Nudge marketing techniques
Nudge marketing techniques can help push consumers into action and alter people’s behavior in a way that increases sales while also improving the shopping experience. Some of the key techniques to do this include:
Price anchoring
A price anchor is a higher original price contrasted with a new, lower price (customers will see the original price crossed out and the new, lower price displayed next to it). A higher price anchor uses long-standingpsychological insights to influence customer behavior: People like seeing the comparison between what they would have paid before the discount. The price difference between the original and the new price gives people a reference point and suggests they’re getting a good deal.
Pop-ups
Pop-ups on online stores are another type of marketing nudge. Though marketers can sometimes overuse them, pop-ups can help consumers when they get stuck or if they’re about to leave a website.
A popular type of pop-up is the exit intent overlay, which appears if there are signs the customer might leave the website (generally determined via mouse movement). When it seems like they are about to leave, exit intent overlays pop up, often with an economic incentive to continue shopping—like a free trial, free shipping, or a temporary discounted price.
Social proof
Nudge marketing often relies on customers’ desire to follow what others are doing. By placing product reviews with product images, businesses can demonstrate the popularity of a product and showcase real users describing its attributes. You can also demonstrate social proof by adding badges such as “Most Popular” or “Bestseller” so users know what’s trending.
Social proof can also come in the form of a smart notification. For example, when someone adds an item to their cart, a notification that says “Trending item!” or “Selling out fast!” could appear, which makes the customer feel like they’re buying something in high demand. This might push them to finish the purchase before it sells out.
Packaging and bundling products
Creating high value packs of products can be a great way to encourage customers to save money. Clear graphics to explain the functional benefits of a product and the product characteristics can help customers understand how the product is useful when bundled with related products.
An example of nudge marketing
There are many tools in the nudge marketing strategy toolbox—you likely encounter them every day without even realizing it. A great example of nudge marketing comes from Maimoda Jewelry, a handmade jewelry store based in Oahu. The brand includes several nudge marketing techniques on its website, such as showcasing featured products prominently, offering free shipping, and having a list of “Related products” on each product page. These subtle influences can help customers make decisions and find what they’re looking for without getting overwhelmed.
Nudge marketing best practices
- Be positive and encouraging
- Keep nudges minimal
- Don’t sound desperate
- Know your target audience
- Analyze and adjust tactics as needed
A strong nudge marketing campaign is positive, minimally invasive, and helps the customer connect with the product and the company. Here are a few best practices to help your nudge marketing work better on your target audience:
Be positive and encouraging
Nudge marketing works when it gets the consumer excited about their purchase. When using social proof, for example, showcase positive reviews to help customers see how others’ lives have been improved by the product.
Keep nudges minimal
Nudges should make the shopping experience easier, rather than making the customer feel like they’re being coerced. Pop-ups should be infrequent, unobtrusive, and easy to dismiss—don’t try to hide the “X” button. A screen with too much information (reviews and badges and suggestions and pop-ups) also runs the risk of overwhelming the consumer rather than helping them.
Don’t sound desperate
Avoid using phrases like “must go” or “overstock” that might make the product sound unappealing. No matter what desired behavior you want to encourage, look for ways to frame the purchase as the customer getting the better end of the deal.
Know your target audience
Depending on your product and target audience, the type of nudge you use might differ. If you are selling to an environmentally conscious audience, for example, it could be helpful for your site visitors to include relevant information about the products’ sustainability. Some companies use icons known as trust symbols to show a product is good for the environment. For instance, Patagonia product pages may feature a “Fair Trade Certified” symbol to reassure shoppers the company has vetted its factories.
Analyze and adjust tactics as needed
Once you’ve introduced nudge marketing techniques onto your site, track them to see what’s working and what might be turning off site visitors. Be prepared to change approaches if the data shows a nudge isn’t working.
Nudge marketing FAQ
What is the goal of nudge marketing?
The goal of nudge marketing is to subtly influence consumer behavior and decision-making in a way that benefits both the consumer and the business, often without the consumer being fully aware of the influence. Examples include offering limited-time discounts, using social proof like customer reviews, and simplifying the checkout process to encourage purchases.
What is the basic nudge theory?
Nudge theory proposes that human decision-making can be influenced by subtle environmental cues—nudges. For example, by making slight adjustments to the layout of a product page (the environment of an online purchase), you can prompt customers to purchase.
What is the difference between a nudge and an ad?
Nudge marketing is not an ad. A nudge is a subtle design choice a business incorporates into the retail experience to encourage a consumer toward a particular action by providing visual cues, notifications, and other incentives.
What metrics should I track to measure the effectiveness of my nudge marketing efforts?
One good metric for measuring the success of nudge marketing is conversions—typically sales. To do this, first determine which desired behavior you want to increase. Next, design your nudge to promote this behavior, then A/B test the nudge against the standard shopping experience. If more users convert when they're exposed to the nudge, you can be confident it works.
