There are a lot of food options around our office in downtown Toronto. We have the choice of exploring the PATH (the retail-laden tunnels that link the office buildings underground), strolling down Queen Street, venturing to King West, or settling in at any number of restaurants along Adelaide. Yet, inexplicably, there’s always a line at my favourite places while others remain unloved.
A number of different reasons may be responsible for why a handful of restaurants are so popular. Perhaps it’s because we aren’t very adventurous; an old favourite is hard-pressed to disappoint us. Or, after a morning of calculated decisions, autopilot carries us to our default lunch spot before it even registers. Alternatively, because we’ve been there before and had a good time, we want to experience it again. When we get tired of the old standbys, it’s difficult to convince ourselves to try something new when the restaurant is empty unless someone vouches for it. So we find ourselves joining the line of an already busy establishment.
Loss aversion pushes us to make safe choices, and we rely on defaults when we’re indecisive or indifferent. Today, I want to focus on the last behavior mentioned – joining the line of an already busy establishment.
- The notion of following our past behaviour is called self-herding, a concept defined by professor Dan Ariely of Psychology and Behaviour Economics at Duke University. If we do it once, we are likely to do it again. In the example above, we continue to be patrons of a restaurant that provides a good experience. This is how habits are formed.
- More generally, herding refers to following a gathering, like waiting at an already crowded venue. It’s a basic signal of social proof: evidence of appropriate behaviour as illustrated by others. For example, with so many people in line, a restaurant must be good. Or standing outside an unlocked door with a group of people under the assumption that someone must have tried opening it already. The more we can relate to the people around us in those situations, the stronger the social influence.
Vouchfor!™ is a venture Intelliware worked with to leverage the exact premise of social proof. A good reputation and positive reviews are considerations in the purchase cycle; however, recommendations from friends or people you trust carry a lot more weight.
Vouchfor! allows merchants to manage referral campaigns, offering incentives and tracking customers and their referrals. This is built on what people are already doing freely: vouching for contractors, agents, restaurants and other businesses. Recognizing this, the service hoped to encourage and amplify that behaviour through incentives and create a self-herding habit; when a friend needs X, an existing customer will recommend Y. Done often enough, Y will be associated with X.
It’s worth noting that large scale behavioural change may begin with self-herding if it garners enough momentum, sometimes even self-generating. For example, let’s say you learn your neighbour’s energy spending is lower than yours (social proof). You and your neighbour are pretty similar so it causes you to re-evaluate your energy consumption. You get used to turning off the lights when you leave the room and limiting the use of the air conditioner (self-herding). People across the street hear about this and consequently reduce their usage as well. Once this reaches a critical mass, lower average energy expenditure becomes the norm. Deviating from this average will paint a household in a negative light (social pressure). This is exactly what happened at San Marcos in 2005.
The next time you try to persuade customers or prospects, consider the techniques of self-herding and social influence:
- Use testimonials, reviews and ratings.
We equate testimonials, reviews and ratings with evidence that someone else has tried the product or service. Actions that require little effort, such as a rating or clicking “Like” on Facebook, are easy for people to do; however, on the receiving end, we give reviews and testimonials much more weight. The more personal the channel of communication, the better. For example, broadcasting a Twitter endorsement is less effective than sending a friend a text message about the same business. Facebook highlights friends before strangers in events listings to be persuasive. Marketing emails that address customers by name are better received.
- Create a virtual line.
Consider using a waiting list as a signal for value and scarcity. For events, display the actual wait list or RSVPs. Before a product is launched, establish a pool of beta users. Mailbox maneuvered a brilliant user experience that resulted in an 800,000 person wait list. By displaying the current number of people in line, it created anticipation and exhibited social proof (why would so many people wait if it wasn’t worthwhile?) By displaying your place in line, particularly the number of people in front and behind you, the app illustrated progress and created artificial status.
- Use a loyalty program to establish a relationship.
If I am loyal to a business, the business should be loyal to me. It’s the basic principle of fairness and reciprocity. The goal is to create a series of good experiences to keep customers coming back. It reassures them that they are making a good choice each time. A collective history of good experiences from many different people enables you to build a credible brand which, in turn, others will follow.
Self-herding and following social norms are shortcuts we take when making decisions. However, it’s important that we’re aware of when we’re using these biases. If we follow a crowd blindly, we may draw the wrong conclusions for ourselves. There is a reason your mom used to ask, “If your friend jumped off a bridge, would you do it too?” If we don’t pay attention to the history of our own actions, we risk developing bad habits.