The Psychology of Influence in Online Startups

Hello smart entrepreneur. I know you’re a busy person, so I’ll be brief. Read this post NOW, if your startup involves convincing someone to do something. Your friends and competitors are reading it already. Years of research into human behavior and influence went into these insights by Prof Robert Cialdini, so read actively, and try to apply these lessons on your business.

In the process of acquiring new customers, startups need to persuade, convince or enchant the potential customer to sacrifice a resource, let it be time, money, access to their stream of information, in order to use the startup’s product. The persuasion process is very subtle, and most likely takes place in a matter of seconds: the user gets to the landing page, the user sees your icon in the app store, the user thinks about registering for a free trial… these seconds are going to determine the future of your business.

In Paths to Power, one of my favorite courses at London Business School, they brought Jim Alvarez, a hostage negotiator for a Kidnap for Ransom cases, to talk to us about persuasion. Very inspiring stuff, as his persuasion skills can make the difference between life and death. In his talk Jim referred to the guru of behavioral psychology, Prof Robert Cialdini’s “The Science of Persuasion“, which lists the six basic tendencies of human behavior that come into play in generating a positive response: reciprocation, consistency, social validation, liking, authority and scarcity. I found they all apply to tech startups and below is my effort to apply the theory to the practice of customer development.

Professor Robert Cialdini, author of the “Psychology of Influence”

The Six Tendencies of Persuadability – Theory and Practice

1) Reciprocation – All societies subscribe to a norm that obligates individu- als to repay in kind what they have received.

In other words, there’s no such thing as a free lunch, but with a positive spin. Your startup did something nice for me and I’m going to do the same for you. Offline, a great example of reciprocation is when someone cleans your window on a red light – they provided a service, and you, grudgingly, feel compelled to reciprocate. Online, you can use reciprocity to increase sales. For example, several Facebook games offer the option to send other users a virtual gift. Developers added the option to “gift back” and it works like a charm. Similarly, online dating sites enable users to send virtual roses. Normally, the male pays $1-$5 for the gesture, and the reciprocation comes in the way of attention – a thank you note that sparks a conversation.

2) Consistency –  the potent human desire to be, and to appear, consistent. 

The desire to be consistent with what we said we will do, has a powerful effect. Apparently, when you get people to say what they’re going to do, they are 16 times more likely to actually do it! Cialdini mentions the example of a Chicago restaurant, that had a huge problem of no-show reservations, which made it difficult to run the business, predict costs, etc. The owner managed to reduce the no-shows from 30 to 10 percent, by changing a two words in what the receptionist asked the diners when she called to confirm their reservation: from “Please call if you have to change your plans” to “Will you please call if you have to change your plans?” a question is much more powerful than a statement.

Zipcar.com’s homepage is filled with questions – “where can I drive?”, “Is Zipcar right for me?”, “How does it work?” – that gets our brains working and we have a clear call to action. Another practical application is closing emails with a question- “So is Wednesday good for you?”

3) Social Validation – If many individuals have decided in favor of a particular idea, we are more likely to follow, because we perceive the idea to be more correct, more valid.

This is probably the most familiar technique to use online, as it tries to capture buzz and word of mouth recommendations. Sticking in the 10,000 Facebook fans on your homepage, or seeing that a particular web result has 50 +1s on Google makes us generally more comfortable to buy or sign up. A product that executes beautifully on this predicament is GoGoBot, the social recommendation engine for travel started by Ori Zaltzman.  Despite that Facebook is not the place I would think about for booking travel, I find it comfortable to book my trips there since many friends have provided their recommendations.

4) Liking –  People prefer to say yes to those they like

Affinity, Rapport and Affection are all part of this feeling of connection between people. The textbook example of liking is Tupperware. The plastic containers were not sold in the stores, but were distributed in “home parties” which were organized by a a liked friend or a salesperson who hosted the party in their house own (also builds on reciprocity). Another example for likeability is Zappos customer service. If you provide your clients with great customer service (no scripts, no time limits on the call, flexible return policy), they will Tweet about it, Like you on Facebook and reciprocate in kind.

Research has shown that like-ability can take different forms:

a) Physical attractiveness – in the online context it really comes down to how pretty is your UI/UX or embedding beautiful images that help form your perception – event site Erly does a good job at that. In the physical world, good looking fundraisers for the American Heart Association raised almost twice the money. What sites or apps do you find yourself preferring?
b) Similarity – a connection between you and your customers. Today it’s relatively simple to find out a lot of information about the users by having them connect to one of their social profiles using OAuth. Pintrest for example, make users give them information about their tastes and interests before they display the homepage, etc.
c) Compliments- get trained in the use of praise. It’s so simple that you may wonder if it really works, but a sincere “Congratulations!’ from Klout on getting +1 scores, makes us  feel that the score must be important!
d) Cooperation – helps enhance positive feelings and behavior. You can imply cooperation online by fighting a common enemy: Virgin has British Airways, Weight-loss apps fight fattening food, productivity apps combat against procrastination – find your enemy and partner with your user!

5) Authority – People tend to comply with the wishes of those in authority. 

It was found that a man can increase by 350% the number of people that would follow him across the street on a red light, when he’s simply wearing a suit and a tie. In comparison, on a website, showing off your experience, expertise or scientific credentials can influence users to use your product. Examples include celebrity endorsements, competition winning badges like RedHerring Winner, “As seen on” logos of TechCrunch/VentureBeat/GigaOm, Trustee Certified, statements like “The Leading ____ in the US” and so on. There’s no problem in using authority as long as you’re not cheating your users so this source of persuasion needs to be used responsibly.

6) Scarcity – items and opportunities become more desirable to us as they become less available.

Groucho Marx said  “I don’t want to belong to any club that will accept me as a member”. The opposite is definitely true as well – we want to belong to clubs that don’t let everyone in. Limited supply, limited time only, apply to request an invite – all of these techniques make us wiggle our tails and stand in line for the great promise of the product. Offline, companies like Zara thrive on this, as customers know that a product that fits and is in stock probably won’t be there tomorrow. Online, examples of scarcity as  a persuader are many.

One of my favorite shopping sites used to be Woot (bought by Amazon). It offered one product a day, that was updated each day at midnight with limited supply. A message board showed how many products were bought per hour since midnight, and almost every night products were sold out. I’ve never bought so much stuff I didn’t need, the scarcity element just worked on me. Google+ invites were a hot ticket when the product came out. aSmallWorld is a closed social network for jet-setters, and online veteran users have the ability to invite new members.  Many others have people tweet specific messages or “Like” a product on Facebook in order to get access to it or a special discount. And of course we have Groupon, Vente Privee and all the daily deal and private shopping sites, that offer limited-time deals if you ‘buy it now’. Also, Foursquare badges are a real motivator for some to check in again and again. Users become advocates of the places where they are “Mayors”, but there can only be one mayor at any given place.

Food for Thought

Information overload has made your users busier than ever. They get more email, read more news, watch more videos and use more apps than ever before. Think about that and put yourself in the shoes of the user that is checking out your product for the first time. Are you offering her any value? asking her a relevant question? connecting her to her friends? presenting her with something beautiful? comforting her with the security of the site and explaining why she should act NOW? If you have a moment, read the first paragraph of this post again. Did it make you dive in?

I hope the principles discussed by Cialdini help you look at your product in a new way. Those precious few seconds that she’ll dedicate to your website will make a difference between failure and success.