KHWS Blog: Powerful tools in the wrong hands?

Powerful tools in the wrong hands?

Behavioural Insight

Under pressure to find a good last minute deal? Be it accommodation, gig tickets or a Black Friday promotion, those comparison sites know what makes us tick and how to get customers to purchase. In this blog post Founding Partner Nick Hawkes explores the value of scarcity in light of a new government enquiry.

The government’s Competition and Markets Authority (CMA) recently launched a wide ranging enquiry into hotels and booking websites that, amongst other things, may offer false comparisons when searching for a good deal. The investigation is a result of concerns that booking websites may be potentially breaking consumer law e.g. are the discounts real or are they comparing the higher weekend room rate with the weekday rate, for which the customer has just searched?

Image: popular comparison sites

According to the CMA about 70% of people who shopped around for hotels last year used hotel booking websites such as Trivago, Expedia or LastMinute.com. Whilst there is no evidence that any of these companies have been involved in bad practices, the CMA want to know if consumers are being misled, calling into question ‘the clarity, accuracy and presentation of information’ on these sites.

From a behavioural-led marketing point of view, one of the more interesting aspects of their investigation is ‘pressure selling’. This is when websites can create a false impression of the number of rooms available, or rush consumers into making a decision with warnings such as ‘Five other people looking at this now’ and ‘Last booked 45 minutes ago.’ This is a quick way to encourage a sale but something the CMA will be closely inspecting.

At KHWS the Brand Commerce agency, we have identified nine heuristics that are key to purchase decisions and reframed these mental shortcuts or Sales Triggers (as we call them) that can directly influence purchase. We use Sales Triggers to provide a framework that makes behavioural science useable shaping messaging and marketing calls to action, helping brands and retailers sell.

One of these nine Sales Triggers is around scarcity which we term ‘less means more’ (reinforce a brand’s exclusive positioning by limiting supply as people value scarcity). By creating the impression that a product or service is scarce, the decision to purchase can be greatly enhanced with the fear of missing out on that particular deal – for instance, it might be unavailable at a later time or the price rises.

It’s all well and good if the website is providing the consumer with a genuine commentary on the state of the offer from which to base their decisions, but the CMA will be looking to see if the founding advertising principles of legal, decent, honest and true have been adhered to.

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