Psychological Principles in CRO: Nudging Users to Convert

Conversion rate optimization (CRO) is the practice of optimizing web pages and funnels to increase conversion rates. 

A key way to boost conversions is to utilize psychological principles in CRO to ethically influence user behaviour. Rather than using overtly promotional tactics, CRO experts can subtly nudge users towards desired actions. 

The goal is to make conversion the easiest and most intuitive choice for site visitors without excessive persuasion. 

Understanding cognitive biases and crafting experiences that account for how users think and make decisions can lift conversion rates significantly. This article will explore key psychological principles that can be applied in CRO to gently guide users down the funnel and motivate conversions. 

With thoughtful implementation, psychology-based techniques allow for boosting conversions while maintaining a positive user experience.

Key Psychological Principles

1. Scarcity and Urgency

The scarcity principle states that people assign more value to things that are rare or dwindling in availability. This stems from our natural reactance when resources are limited – we want something more when we can’t have it. 

In CRO, scarcity can be invoked through real scarcity or artificial scarcity. Real scarcity occurs when there is limited inventory or availability, like one-time sales on products with minimal stock. 

Artificial scarcity uses psychological tricks to make users feel something is scarce when it is not, like displaying “Only 2 rooms left!” on hotel booking sites.

Urgency is related to scarcity and can also influence user behaviour. Creating a sense of urgency with time pressure, such as “Sale Ends Today!” can nudge users to take action.

 Another way to build urgency is by generating fear of missing out (FOMO). Letting users know other shoppers have items in their carts or showing decreasing stock meters can instil urgency through FOMO. 

However, ethical implications must be considered with artificial scarcity and false urgency. While these techniques may work, overly manipulative tactics can damage customer trust and satisfaction long term. The best practice is using truthful scarcity and urgency to motivate users while providing transparency.

Here’s an example of urgency in action:

2. Social Proof

The power of social proof stems from two key psychological forces – informational social influence and herd behaviour. 

Informational social influence refers to our tendency to assume consensus equals correctness. When we are unsure how to act, we look to others for cues on the right behaviour. 

For example, if you walk into an empty restaurant, you may be hesitant to dine there. But if you entered a packed restaurant, you’d feel assured it was a good place to eat. The consensus of the crowd signals quality and safety.

Herd behaviour is also at play. Humans have an instinctive drive to follow the herd and adopt the actions of the majority. If everyone is raving about a new TV show, we assume it must be outstanding and rush to watch it. 

Going against the cultural norm feels uncomfortable. Leveraging both these forces, social proof provides a shortcut to decision-making – if everyone else likes it, it must be good.

In CRO, social proof is invoked by including social signals on pages. Examples include showing the number of buyers for a product, displaying positive ratings and reviews, noting how many users have items in their carts, and progress bars stating “50% of course complete.” 

These elements tap into informational social influence and herd behaviour. Seeing 20,000 buyers or 4.5-star reviews shapes our perception and behavior. We assume what is normal, popular and consensus-approved is optimal.

However, ethical risks exist in exaggerating or falsifying social proof. Fake consensus signals like inflated buyer numbers or ratings from non-customers will undermine credibility. 

The ideal approach is to showcase honest signals and testimonials from real users. With the thoughtful and transparent application of social proof principles, CRO experts can spur powerful informational and cultural influence on user behaviour.

See this example:

3. Anchoring

Anchoring describes how initial exposure to a number serves as a reference point that shapes future judgments and decisions. In CRO, common anchoring tactics include price anchoring and product tier anchoring.

Price anchoring involves setting a higher initial price to anchor expectations before revealing a lower target price. Examples include strikethrough pricing and coupons (“Get 20% off!”) that indicate higher regular prices. This makes the target price seem more reasonable and triggers feelings of saving money.

Product tier anchoring means presenting multiple offerings ranging from lower to higher feature sets and prices. The target middle option appears superior compared to lower tiers and a deal relative to expensive tiers. The flanking options alter perceptions to make the middle selection look appealing.

Both approaches leverage anchoring bias where that first number gets stuck in our heads, skewing our sense of appropriate prices and value. By caringully anchoring expectations through initial pricing signals and product ranges, CRO practitioners can steer users towards target options.

4. Endowed progress

The endowed progress principle is rooted in our tendency to overvalue progress that has already been made compared to zero progress. 

When we look at a partially completed task or process, we perceive the work remaining as less significant than starting from nothing. This cognitive bias is called pseudo-endowment effect – we endow the partial progress with higher value, which makes completing the task feel easier.

In CRO, common ways to leverage endowed progress are through progress bars, percentage counters, checkmark trackers, and step/milestone indicators. 

For example, a signup flow with a progress bar visually representing “50% complete” creates an illusion that the user has already made meaningful progress. The remaining 50% feels smaller in the user’s mind. Even if the user just entered an email, seeing halfway completion triggers positive feelings and momentum.

Similarly, checkout flows showing 3 out of 5 steps finished make the remaining steps appear quicker and easier. The user feels they have invested effort that would be lost if they abandoned the process. 

Trackers with checkmarks for each step completed also fuel a sense of progress. The partial visual completion motivates action to reach the end goal.

Essentially, endowed progress tricks our brains into overvaluing started work compared to untouched work. By making users feel they have already progressed, CRO experts can reduce drop-offs and nurture commitment to final conversions. The psychology of pseudo-endowment is powerful for guiding users further through funnels.

5. Reciprocation

The norm of reciprocity is a powerful social obligation that compels us to repay when someone does something positive for us. 

If a friend buys you lunch, you feel you should return the favor. When a stranger holds the door open for you, you instinctively say thank you. We are wired to reciprocate, even when dealing with faceless interactions online.

In CRO, reciprocation can be leveraged thoughtfully through free offers and content that users feel inclined to repay. For example, an ecommerce site offering free shipping triggers feelings of gratitude and indebtedness. 

When users save money, they feel obligated to complete the purchase to return the favour. Similarly, providing gated content like free ebooks in exchange for email addresses taps into reciprocity. Users gain value upfront and feel they should reciprocate by completing the desired action.

However, overt manipulation backfires, so reciprocity must be applied carefully. If users see through false generosity intended only to engineer obligation, it damages credibility and trust. The ideal approach is to provide free value and content with no strings attached consistently over time, not just as a conversion trick. 

This nurtures authentic reciprocity feelings that work long-term. With thoughtful implementation, reciprocation is a powerful way to mutually benefit users and businesses. But deception outweighs short-term gains.

6. Consistency

As human beings, we have a fundamental motivation to maintain consistency between attitudes, stated beliefs, and actual behaviours. When inconsistencies emerge, we experience cognitive dissonance – an uncomfortable psychological tension. 

To reduce dissonance, we alter attitudes and actions to restore alignment. Essentially, we crave harmony in what we think, say, and do.

In CRO, the desire for consistency can be leveraged by creating follow-up touchpoints after users take initial actions. For example, if a user adds items to their cart but doesn’t complete checkout, sending timely reminder emails nudges them to finish purchasing to match their initial intent. 

Providing quick links to saved items that were not purchased also taps into consistency motivation.

Messaging like “Complete your purchase” reminds users of actions already taken, prompting follow-through. Checkout flows that pre-populate fields using stored customer info reduce friction and make finishing seem natural. 

Easy re-engagement fosters consistency between partial progress and final conversions.

However, overly persistent nudging can be perceived as annoying and pushy if not executed thoughtfully. The ideal approach is seamless, with minimal friction next steps rather than aggressive calls to action. 

With care taken to align with original user intent, leveraging the instinct for consistent behavior can guide visitors naturally down conversion funnels through completion. But excess disruption risks dissonance.

7. Loss Aversion

Loss aversion refers to the tendency for potential or perceived losses to feel psychologically more powerful than equivalent gains. 

Research shows humans experience the pain of losing something as about twice as intense as the pleasure of gaining something of equal measure. We are more driven to avoid possible losses than to acquire hoped-for gains.

In CRO, commonly used tactics to address loss aversion are guarantees and reversals of risk. For example, money-back guarantees allow customers to return purchases for refunds if unsatisfied. 

This shifts the monetary risk of loss onto the seller rather than the buyer. Similarly, free trial periods with simple cancellation options let users experience services risk-free before committing.

These techniques accommodate our asymmetry between valuing losses over gains. When users perceive their risk of disappointing purchases or wasted money is reduced, they become more comfortable moving forward. 

Essentially, quelling fears of loss removes friction and nudges conversion forward. Other examples include low-risk options like gift cards to sample products and starter packs that give previews before big investment.

Accommodating loss aversion with guarantees, trials, and low-risk offers help users take action. 

However excessive reversals of risk also impact businesses negatively. The ideal approach is mitigating just enough perceived risk to ease user fears but not remove business skin in the game. 

With careful design, CRO practitioners can leverage loss aversion prudently to guide visitors towards commitment.

See this example:

Applying Psychology Principles Ethically In CRO

1. Landing Pages and CTAs

Social Proof Elements

• Include credible testimonials and customer stories that reinforce your claims and build trust. Quotes and reviews from real buyers are more persuasive than generic claims.
• Display subtle proof elements like “Join 20,000+ customers who trust us” or “Rated 5 stars by 500+ users.” Seeing others use and vouch for your offering provides social validation.

Urgency Signals

• Stock counters, scarcity warnings, and timers can create urgency to act now. But use time pressure carefully – false scarcity undermines trust long-term.
• Indicators of limited inventory like “Only 3 left!” tap into scarcity. But ensure real inventory backs up the claim, or risk misleading users.

In general, balance scarcity cues with transparency, and social proof with authenticity. Psychological principles are powerful, but lose effectiveness if perceived as manipulative. Craft landing pages and CTAs that activate biases while respecting user experience.

2. Messaging and Content

Reciprocity in Offers

• Provide free content like ebooks, webinars, and guides that users will feel obliged to repay by converting.
• Consider free shipping, extended return periods, and free trial periods to trigger reciprocity. But ensure genuine value, not just obligation.

Consistency in Follow-Ups

• Send periodic reminder emails to complete purchases, fill out forms, and engage with content.
• Prompt returning users to re-engage with saved items and incomplete actions. But avoid seeming overly pushy.

In general, leverage reciprocity authentically by delivering value upfront without strings attached. And make consistency nudges helpful reminders of original intent rather than aggressive push attempts. With thoughtful timing and messaging, these principles can guide users down the funnel.

3. Page Design and UX

Loss Aversion Signals

• Prominently display guarantees, return policies, and trial periods to reduce purchase risk. This eases loss aversion.
• Allow gift cards or small starter packs to “test” products before big investment. Lowering perceived risk supports conversion.

Progress Bars

• Visualize steps already completed with progress trackers, percentage counters, and checkmarks. This leverages endowed progress bias.
• Progress bars create illusion of advancement and momentum. Motivate completion by showing work already done.

In general, mitigate loss aversion by guaranteeing satisfaction and highlighting risk reversals. And tap into endowed progress by tracking completion to motivate next steps. Carefully designed experiences activating these biases gently nudge visitors towards commitment while maintaining trust.

Ethics Guidelines

Transparency

• Clearly explain any limited-time promotions and when they will expire, so users understand the timeframe. Avoid vague urgency that hides the real expiration.
• Disclose upfront if signing up for content will trigger recurring promotional emails, how often they will be sent, and how users can opt out. Don’t hide repeat communication.
• Inform users during signup what data will be collected, how it will be used, and who it will be shared with. Ensure proper consent.
• Disclose any paid partnerships or affiliate relationships that could influence recommendations. Don’t let bias go unstated.

Clear User Value

• Offering free returns, shipping, or extended trials should authentically ease purchase risk for the user’s benefit, not just increase conversion.
• Providing gated content like ebooks and webinars in exchange for contact info should genuinely inform and add value for users, not just build lead lists.
• If reciprocity is expected after gifting free items or content, state it transparently rather than assuming unspoken obligation.

Respect User Experience

• Scarcity and urgency tactics should align with and nudge user goals forward. Don’t interrupt journeys with constant pop-up notifications and high-pressure tactics.
• Allow easy opt-out from emails, notifications, and communications. Avoid “roach motel” retention tactics that force user engagement.
• Time follow-up reminders and consistency nudges thoughtfully to assist users, not annoy them. Overly frequent outreach fatigues.

Authenticity

• Customer quotes, reviews, and testimonials used as social proof should represent real experiences, not be fabricated or misconstrued.
• Avoid exaggerating limited inventory or deceiving users with falsely urgent stock levels. Display authentic numbers.
• If claiming large user counts or buyer numbers, ensure accurate verified statistics, not exaggerations.

Moderation

• Avoid over-reliance on psychological nudges and dark patterns that feel manipulative. For principles like reciprocity and scarcity, find optimal balance.
• The right cadence for reminders and reciprocity messaging depends on the user and context. Continuously iterate based on feedback to improve timing.
• Do not apply principles broadly by default without testing. Measure impact on experience to determine appropriate use cases and frequency.

Continuous Optimization

• Monitor user feedback and behavior changes to repeatedly improve implementation and avoid overuse of principles.
• Survey users and utilize tools like session recordings and heatmaps to identify poor experiences and ethical issues.
• Keep evolving guidelines as user preferences change. Do not become overreliant on assumptions or past approaches without reevaluating.

Frequently Asked Questions

Question: What are some key psychology principles used in CRO?

Answer: Some key principles are scarcity, social proof, reciprocity, consistency, authority, loss aversion and endowed progress.

Question: How can scarcity and urgency increase conversions?

Answer: Scarcity and urgency tactics like stock counters and limited-time offers can increase conversions by creating fear of missing out. But beware false scarcity.

Question: What are some examples of social proof used on landing pages?

Answer: Social proof like customer testimonials, reviews, and proof claims like “1 million users” heighten trust and credibility.

Question: How does anchoring work to influence customers?

Answer: Anchoring guides perceptions by exposing people to an initial number that colors subsequent judgments. Price anchoring uses strikethrough discounts.

Question: What is the endowed progress principle?

Answer: Endowed progress makes a process feel easier by highlighting advancement already made with progress trackers.

Question: What are some ethical concerns with using psychological principles in CRO?

Answer: Ethical concerns include transparency, clear user value, authenticity, and avoiding disruption or manipulation of customers.

Question: How can I apply these principles effectively on my site?

Answers: Principles should align with user goals and gently nudge rather than hijack journeys. Test modifications to ensure positive impact.