Psychographics offer brands valuable, but often overlooked, clues about how consumers make decisions online.
When looking to understand and influence the online shopper journey, there is often a tendency to focus on touchpoints, like social media, reviews and online retailers. However, there is another alternative view of segmentation digital marketers could consider – psychographics.
Because consumer journeys are highly personal – as they are dependent on traits, habits and context – consumer behaviors aren’t homogenous. Psychographic segmentation (personality traits, beliefs, values, etc.) can add another level of accuracy to predicting online decision behavior. Your digital marketing strategies and spend could be more impactful, generating greater online conversion and loyalty, when truly customized to “best fit” your audience.
Read on to learn how different personality traits can affect online decision making. Understanding and applying these insights can give you a competitive edge to ensure consumers choose your brand online.
Using psychographic segmentations to improve digital marketing effectiveness
Several years ago, a popular meme found its way into many marketers’ social feeds and inboxes precisely because it captured the problem with developing marketing strategies based on demographics: although they capture characteristics like age, gender, etc., they really represent many different individuals.
The meme showed two men of similar age and income – a member of the British monarchy and a heavy metal singer. The demographics of these two people look identical, despite their very different interests and preferences.
As a successful marketer in today’s digital economy, you must understand how your audience behaves in the digital space:
What are the subconscious drivers influencing online shopper decisions?
The use of psychographics can reveal a more holistic picture of the mind of the online shopper and where you can better influence it. Factors like personality, values, interests, and lifestyle subconsciously determine how consumers browse, research, and ultimately make their final online purchase decisions.
Whether you want to reinforce consumer habits or disrupt them, psychographics can help you target the right customers and tailor your online messaging more effectively. Examples include personalized ads, emails, product offers, and promotions.
What’s the impact of taking this approach?
At the ESOMAR Insights Festival 2020, Unilever with INMOBI shared how they personalize claims for Breeze liquid detergent in the Philippines based on psychographic segments. After obtaining the psychographic segments of their potential consumer base through a mobile survey, Unilever prepared three different claims on their liquid detergent product, each focusing on the needs and concerns of bargain hunters, skeptics and laggards. The first claim on cost effectiveness was used for potential consumers predicted to be price-conscious bargain hunters. The second claim on efficacy of liquid versus powder detergent was used for those who were identified as skeptics of liquid detergent. The third claim was used to push the laggards, those slow in uptake of new innovations.
Instead of a one-claim-fits-all approach, each consumer saw a claim that was personalized to their needs and concerns. They were dynamically shown one of the three claims using a machine learning algorithm, the one that is most able to resonate to their needs and concerns on the liquid detergent product. The result was an astounding 30% year on year uplift in liquid detergent sales, and also across all three psychographic segments in the Philippines where the powder detergent format is more established.
Some uses of psychographic data, e.g. the 2016 US election, the 2016 UK referendum and the Cambridge Analytica scandal, have given it a bad name. However, done properly and ethically (i.e. user transparency, complying with data protection laws, observing privacy permissions etc.), psychographics can benefit both the brands and the consumers. This means individuals receive personalized messaging for the products and services they actually want with an option to unsubscribe at any time.
Understanding personality traits can help brands influence online shopper decisions
Personality is one psychographic that can yield very useful, actionable information for brands. Here are four examples of its role online, where habitual purchase decisions can be hard to break.
1. Need for Certainty: risk-averse versus risk-seeking
Risk is already a familiar and popular area of study in economics and finance, for example the choice between buying a high-risk but high-return stock, in comparison to a low-risk but low-return stock. Attitude towards risk can be a useful factor for consumer goods markets, especially helping digital marketers.
Risk appetites can indicate openness to trying new products and can reveal which online triggers could be used to influence product trials. Consider those shoppers who keep searching for information to validate their choice or to get reassurance they are making the right decision. These people are likely to be risk-averse, as they prefer outcomes with lower uncertainty. They need more reassurance and credible information.
These shoppers may be more likely to be triggered by a social media ad promoting a free trial. You would need to tailor the ‘free trial’ message to influence these shoppers accordingly. Using an implicit, mobile-based research technique can uncover which messages or visuals could subconsciously offer the most confidence to this segment.
2. Need for Affect (NFA)
The Need for Affect refers to the variation in motivation of how individuals approach or avoid situations or activities which are emotion-inducing, such as watching a sad movie where characters die. Those individuals with high NFA would be more affected by the death of a public figure or the changes in the lives of their favorite Youtuber. A shopper with a high need for affect would prefer more visuals and stimuli as emotional appeal works more effectively on them than logic. And vice versa, a shopper with a low need for affect would prefer more text-based information. If you want to convert a shopper with this trait, you could optimize both the company-owned channels, such as the brand website, along with the assets developed for third-party owned channels, such as ads on media or e-tailer platforms.
What could this approach look like?
Personalize product content and site navigation to drive online engagement
Leverage the user experience and navigation through the website and offer personalized content to drive conversion. For example, steer the high NFA consumers towards more visual information such as product pictures or product videos to induce emotions. The low NFA group might be more interested in reading product reviews or editorial type of content to educate themselves better and understand the product better
Optimize ads based on psychographics to drive online conversion
Tailoring online messaging and visuals based on personality traits can effectively influence consumer choices online. For example, consumers with high NFA would prefer more visual ads that make them feel more emotional and sentimental. Relying on more emotional stimuli rather than rational is more likely to capture their attention and trigger action. Read how a leading eCommerce platform realized a 40% lift in sales by optimizing product content based on the theory of psychological distance.
3. Need for Uniqueness (NFU)
NFU is an individual’s pursuit of differentness relative to others that is achieved through the acquisition, utilization, and disposition of consumer goods for the purpose of developing and enhancing one’s personal and social identity.
A shopper with low NFU could be reached with the use of a social influence nudge. Social influence nudge aims to trigger decision behavior by providing encouragement by stating what other people do. For example, consider how Netflix displays “Top 10 Movies in (Your Country) Today,” while Amazon and other online retailers show that “Customers who bought X also bought Y.” On the flip side, personalities with high NFU (Need For Uniqueness) are less susceptible. These consumers prefer scarce, customized and less popular products, rather than being spurred on by other people’s choices. They can be targeted by releasing limited edition versions of the product. An example is the limited edition Yeezy shoes by Adidas, which would be very attractive to consumers with high NFU.
4. Need for Cognition (NFC)
NFC is a personality trait reflecting a person’s tendency to enjoy engaging in extensive cognitive activity. A person with a low NFC won’t enjoy or would prefer not to engage in making a choice. A way to reach this type of shopper is to utilize default nudges – presenting the shopper with a pre-selected option.
That particular option is likely to be chosen because switching to another option would require more effort. With a default nudge, this group of consumers low in NFC don’t need to make an active decision. For example, food delivery app Grab Singapore uses the default nudge effectively by pre-selecting the ‘no cutlery’ option. Moves like this aim to improve sustainability and could also help brands fulfill their corporate social responsibility goals.
Uncovering psychographic and online behavioral data
Where can you access psychographic data?
In today’s digital-first economy and age of big data, your company likely has many internal, public and third-party online data sources at its disposal.
These data and information sources, combined with predictive analytics, can drive more accurate eCommerce decision-making, since you’ll be equipped with a holistic 360 view of the online shopper.
Your own website or app is a good place to start searching for basic psychographic information and actions taken by consumers online. Of course, these data sources, e.g. an HTML tracking cookie, should be mindful of privacy regulations. Consider testing how different personality traits will respond to which nudges. For example, presenting various ads and discount codes could identify a bargain hunter, even if that person doesn’t profess to be one.
On the other hand, distilling psychographic data from “walled garden” sites, like Amazon or comparison sites, is a challenge many digital marketers face. Since these sites greatly protect their behavioral data, brands are increasingly using eCommerce research solutions to uncover those coveted insights. By replicating digital environments and testing how online shoppers make choices, marketers can increase their agility – shifting content or offers to better disrupt or reinforce those choices.
With the right message, speaking to consumers in the language they relate to best can be vital in facilitating their decision journey and increasing their willingness to engage further with your brand.
Looking at individual consumer journeys and understanding online decision behavior can be incredibly complex, but SKIM offers a selection of eCommerce tools to help you understand those journeys and turn complexity into actionable insights. As an early innovator in mobile research solutions and an expert in modeling choice behavior, we can help you better predict consumer decision behavior online, to dive into the mind of the online shopper in your category.