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What your customer wants and can't tell you
How can you take your business strategy to the next level? The secret lies in understanding your customers better. Enter behavioral economics—a game-changing discipline that helps you catapult your business to success.🚀
Hotjar’s webinar with Melina Palmer delves into how combining behavioral economics with your business strategy can unlock unimaginable potential.
Keep reading for a summary of our webinar or watch the full recording to learn how deciphering the conscious and subconscious layers of the human brain enables businesses to make more informed and effective decisions.
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Behavioral economics is not new, but its integration into business strategies is a game changer. Renowned companies like Netflix and Amazon have already implemented this science to revamp their systems, leading to considerable growth in sales.
Palmer introduced the concept of ‘behavioral baking’, a method where companies assimilate behavioral economics in their core strategies, highlighting these core subjects:
Framing, priming, and the power of the herd
The impact of word choice, numbers, and context
Experimentation
Framing, priming, and the power of the herd
Framing and priming are crucial in decision-making, where the former relates to the presentation of choices and the latter to the introduction of stimuli influencing subsequent behaviors. These factors significantly influence customers, allowing you to develop more effective marketing strategies by understanding your users better.
Herding behavior is also a significant component in influencing how customers buy. You can leverage social proof and testimonials to sway people’s decisions by tapping into the tendency of customers to follow in the footsteps of a larger group. This approach helps foster trust and confidence in your customer base.
The impact of word choice, numbers, and context
Just as a single word can change the tone of a conversation: that’s why word choice, numbers, and context significantly influence your customers’ behavior and decisions. Simple changes in the way you present your products or services can lead to substantial differences in customer sentiment.
Understanding the psychological impact of these elements is key to nudging people toward desired actions. The power of behavioral economics lies in its ability to subtly steer human behavior, particularly in marketing and decision-making.
Experimentation: the key to success
Even if you have a profound understanding of behavioral economics principles, testing and experimentation remain vital. Businesses must consistently analyze their strategies, adjusting and refining them based on experiment results to ensure their tactics continue to align with customer behavior.
Social proof and nudging techniques have proven effective in marketing and decision-making. However, these techniques should not remain stagnant. Conduct ongoing experiments and make adjustments to ensure these methods remain effective and relevant to your audience.
💡Note: while often associated with for-profit entities, behavioral economics also has significant implications in the non-profit sector. Non-profit organizations can use these principles to influence behavior and enhance fundraising efforts, leading to more significant contributions and donor engagement.
Key takeaways
Behavioral economics is more than a business buzzword; it's a powerful tool that helps you better understand your customers and significantly improve your strategies. Whether you’re in marketing or the non-profit sector, the principles of behavioral economics have far-reaching applications.
For a deeper understanding of behavioral economics and its integration into your business strategies, be sure to check out the webinar recording here. Harness the power of behavioral economics to drive your business to new heights.
About our speaker
Melina Palmer is CEO of The Brainy Business, which provides behavioral economics training and consulting to businesses of all sizes from around the world. Her podcast, The Brainy Business: Understanding the Psychology of Why People Buy, has downloads in over 170 countries. Her first book, What Your Customer Wants and Can’t Tell You, was a finalist in two categories of the International Book Awards. Her second book, What Your Employees Need and Can’t Tell You, published October 11, 2022.