How eCommerce Psychology Can Help Your Business

How eCommerce Psychology Can Help Your Business

An integral part of being a great marketer is understanding how people think and how they act in some key situations. It is incredibly hard to create compelling marketing content if you don’t know how how your target audience thinks.

Even more so, if you run an eCommerce business, understanding psychology will provide you with key answers and directions towards what should be your next steps in product development, sales, customer service and pretty much all the activities that directly impact your customers.

To aid you in your eCommerce endeavors, and boost your sales we have put together a list of key psychological principles that you should take into account when looking to improve your business related activities.

eCommerce Psychology Principles

Social Proof

Social media has become an integral part for every eCommerce business out there. What if I told you that social media is actually very close connected with a psychology principle?

As a matter a fact this principle, called social proof is one of the most important for eCommerce psychology. 81% of shoppers conduct online research before buying. That research includes everything from comparative price analysis to social validation.

When researching a possible purchase, customers usually want to find where they can get the best price for that product but more importantly if the people who already bought from a specific company are happy with their purchase.

In order to provide social proof to your visitors you can use the power of reviews in whichever form they may come. Making sure that reviews and endorsements are prominently featured on your website represents the first and usually the best step that you can take towards positive social proof.


Every business out there is trying to increase the loyalty of their customers. The competition in many eCommerce niches is fierce, and the fear that your clients will go to one of your competitors is a common occurrence.

The first step towards having loyal customers starts with the experience of the first purchase. To improve this experience you can reinforce some of your unique selling points or even offering a small discount for the first order. This way customers will make the connection between your business and for example the fact that you offer free shipping for all of your products. 

These connections are what will differentiate yourself from your competitors and at the same time will increase your customer retention time. 

Reciprocation and Appreciation

Reciprocation, as described by represents the act of a returning, usually for something given. If we take this definition and expand it to the eCommerce market, customers are the ones who are giving something a.k.a money to the business in return for a product. Many online businesses consider that after sending the products to their customers, the reciprocation part is done.

As a matter a fact, the business should also reciprocate the loyalty of their customers by showing them some appreciation for the fact that they are buying from them and not from any other competitor.

Appreciation is a wonderful thing: It makes what is excellent in others belong to us as well. – Voltaire

At a psychological level the need for appreciation is one of the basic psychological needs. It has been proven that people who feel appreciated are more happy and also more engaged with individuals that are showing appreciation.

It’s always important to remind your customers and potential clients that your business is actively saying thanks and showing appreciation to loyal customers

Scarcity and urgency

Some leaders in the eCommerce market are already using this tactic, maybe without even knowing. This tactic that I am referring to is in fact connected to the psychological effects that scarcity and urgency have on the human psychic.

In the face of scarcity, humans react based on instinct and they will place a higher value on scarce items and a lower value on those that are abundant. When we as humans, want something that we cannot have, it drives us to desire the object even more.

The scarcity principle is employed by online businesses when they are displaying inventory data for products. The key here is to use genuine information and not to manipulate it in any way or form, in order to make your customers trust these messages.

For maximum effect, some eCommerce market leaders use yet another psychological principle called urgency, which is closely connected with scarcity.

This psychological process, is what makes a customer to speed up the purchase process. Regardless the form of an urgency message(text, countdowns etc.),  it is still very effective especially for impulse buys.

A prime example where these two psychological principles are used is on Black Friday. This event revolves entirely around these two principles. On one hand we have scarcity because there is a limited number of products in stock. On the other hand we have the urgency effect because the event lasts only for one day.


Even if no one will admit it, we as humans, are naturally drawn to things or people we view as authoritative. This in turn means that people are more likely to embrace opinions and advices from someone with authority than from someone without.

We usually create some shortcuts in order to establish if something/someone is credible or not. These shortcuts can be anything from a title (DR., PHD) to popularity (reviews, followers). A famous experiment, called the Milgram experiment, measured the level of obedience towards authority. It was discovered that diverse people are willing to obey an authority figure even if the actions that they were instructed to do, conflicted with their personal conscience.

So how can you take advantage of this psychological principle in order to increase your authority?

Expert reviews are the surest way towards establishing a high level of credibility for your business. Reviews are incredible for any company but expert reviews are even better. Having an expert review some of your products or services is actually not that difficult, but we will talk about this in a future article. Nowadays, experts can be found anywhere from YouTube to Snapchat and they don’t actually need to have some formal degrees.

Number of choices – choice paralysis

Offering a wide range of choices does not usually equate to better decisions. As a matter a fact research has discovered in numerous instances that if we are offered too many choices we will actually be unable to make a choice.

This same effect expands to online businesses.

If for example you are selling T-shirts and you already have T-shirts from 30 – 40 brands listed on your website then for someone that is only looking for a Tee, regardless of the brand, the paradox of choice is in full swing. If you also offer 10 colors, different bundles, than it is even harder and it will take even longer for someone to make a purchase.

Even if you are selling lots of various products, keep the customization options to a minimum or at least test the performance of this strategy. This way you can better optimize the purchase flow from start to finish and close more orders, faster.


eCommerce businesses should be aware that psychology is a valuable tool, which can provide extra benefits and revenue for the company. Using psychological methods to determine trends and pain points is not that new but still many companies are under-utilizing it in their business decisions. 

Customers don’t become loyal to a company by themselves. The company is responsible for increasing the loyalty of their clients by offering them an incredible shopping experience straight from the beginning.

What psychological principles do you use in your business? I can’t wait to read all your answers.


Submit a Comment

Your email address will not be published. Required fields are marked *