Increasing Online Conversion by Reducing Psychological Distance

In today’s crowded online marketplace, we all face the same challenge: how do we attract and convert shoppers? While increased media spend is an almost guaranteed way to attract more people to an online platform, getting them to actually buy is a whole different ball game. Many online retail giants aren’t forthcoming with behavioural data, so knowing how visitors think and behave from the time they land on the platform until they check out is a blind spot for many of us.

Tapping into consumer psychology can be one way to tackle this challenge. SKIM’s psychological distance theory, developed in collaboration with bright minds at the psychology department of New York University, can help us find ways to drive online conversion.

We believe that by applying this theory to product images, you can lower the psychological distance between the consumer and the brand, and drive conversion as a result.

We recently put our theory to the test by teaming up with Qoo10, a leading e-commerce site in Asia, and Singapore’s number one online shopping destination. Here we share the results of the experiment and how you can apply our theory to optimise your e-commerce strategy.

SKIM’s psychological distance theory explained

Different levels of psychological distance alter people’s perception of reality. Lower psychological distance allows people to focus on your product or service concretely instead of abstractly, giving them a clear and tangible idea of what they are going to get. This impression, ultimately, allows the consumer to ‘experience’ rather than see the product.

This tends to generate more desirable product judgements and helps create a match between what the consumer is looking for and what your brand offers. However, once shoppers view the product online, there are still serious barriers that must be overcome to convert that view into a sale.

Barrier #1: An infinite number of options makes your product harder to find

Unilever took the lead in solving this challenge. Working closely with Cambridge University and with SKIM at a later stage, they developed the Cambridge Standard for Mobile Ready Hero Images. By making brand, format, variant, and size much easier to recognise, hero images proved to be an effective tool for tackling this findability issue. Conversion rates went up, and Unilever hero image guidelines were adopted by the broader FMCG industry.

The existing hero image guidelines help consumers understand what physical product they are going to get. This successfully reduces the psychological distance between the product and the consumer, but we believe we can do even better than this.

To fully close the gap, we recommend doing more than just communicating a product’s physical characteristics. There also needs to be a ‘match’ in terms of the desired and promised product experience.

Think of the clear picture you have in your mind of how you want your hair to look after using shampoo, or the delicious taste explosion you imagine when choosing which ice cream to buy. Convincing consumers your product will deliver on the desired product experience is difficult in general, but particularly difficult online.

Barrier #2: People cannot touch, smell, or taste your product

In a physical store you can pick up a product, perhaps even try samples. Online, all senses, expect for vision and hearing, are muted. This environment makes it difficult for consumers to get a clear idea of the product experience they are going to get, which creates uncertainty and lowers the probability of a sale.

While the digital nature of e-commerce is the very source of this problem, it provides the solution at the same time. The flexibility of digital content allows us to include written or visual sensorial cues that subconsciously trigger memories, emotions, and automatic reactions stored in memory.

Triggering these prior experiences through the use of sensorial cues leads to the generation of mental imagery, which allows you to imagine how a product and its related benefits look, feel, taste, sounds, or smell. Or in other words, it lets people experience rather than merely see the product, and lower psychological distance as a result.

Putting SKIM psychological distance theory into action

As an early innovator in the e-commerce space, Cho had been optimising Qoo10’s product images for a few years, with promising results. He recognised the importance that visuals could have in generating more return from media spend.

After several passionate discussions about visuals and e-commerce during our shared time at INSEAD, we decided to put our theory to the test: can we increase conversion by using images to minimise the psychological distance between the desired (consumer) and offered (brand) product experience?

SKIM replicated Qoo10’s mobile shopping environment and conducted shopping simulations with 1,779 mobile shoppers. Experiments were conducted for shampoo and chocolate snacks. In both experiments, we changed the images of five separate brands to represent different levels of psychological distance.

The results were remarkable.

In both categories, the new images strongly outperformed traditional pack shots and the existing hero image standard in terms of click-through and add-to-basket rates. For shampoo, using both words and visuals to bring the desired product experience to life had the biggest positive impact. For chocolate snacks, image performance jumped when the product was taken out of the packaging.

These results make a lot of sense when you consider the context. The packaging is just a means to an end, and what people are actually buying is the product inside, which they will consume and hope to indulge in.

What better way to tap into this desired product experience than to actually show the product in an attractive way and subconsciously trigger relevant sensorial cues?

After these encouraging results, we turned our attention to the actual Qoo10 platform to test our theory in a live e-commerce setting. Qoo10 replaced the images for three shampoo brands to determine how accurate the experimental results were compared to actual online sales.

The in-market results were in line with our simulated shopping experiments and even resulted in 64% more page views and 40% more sales for the bestperforming image. It should be noted here that the visuals that were replaced already contained several desired elements, and even greater gains could be expected vs traditional pack shots.

By Paul Janssen LinkedIn, VP Brand Communication of SKIM