Ten-time world champion boomerang thrower Chet Snouffer is not afraid to take risks in his athletic endeavors—in fact, he takes them often. Risk-taking has ultimately paid off for him as his boomerang record clearly shows, and so we thought we’d delve down into the role that risk-taking plays in decision-making to see what we can learn about the connection between risk and conversion optimization.
We quickly decided we’d need to look at business- and money-related risk differently from sports-related risk, especially after a perspective in Psychology Today grabbed our attention. “It never feels like the right time to take risks,” the article reads, “because, well, there are risks to taking risks.”
That sentence really resonates, doesn’t it? Even Chet, who brilliantly demonstrates the benefits of using a combination of experience and intuition to make championship-winning decisions, would look at monetary risks in a different way.
Through our research, we also determined that risk in connection with conversion optimization was a two-sided coin, in which you need to decide how many risks your company can afford to take in experimenting with site changes, and to reduce the perception of risk by prospects coming to your site. Because each company has a different level of risk tolerance, in part because of corporate culture and in part because of cash flow, we are going to analyze customer perception of risk factors in this post.
This is a crucial subject because customers— our customers, your customers—may hesitate to move ahead with purchasing decisions if they don’t feel comfortable spending money on your products and/or services, which can be a significant factor in lower conversions on your company’s website. How can that be addressed?
Analyzing Customer Risk Perception
Step one is to put yourself in your potential customer’s place to think about risk factors as perceived by site visitors. You know that you deliver a quality product and/or service and that you stand by what you offer, but new customers don’t know that about you.
This means that each time someone comes to your site, he or she will need to decide if the reward of buying your product or service is worth the risk (parting with money)—so whether or not you will achieve a conversion depends significantly upon a person’s risk perception.
According to ResearchGate.net, areas of concern for consumers include (but are not limited to):
- Credit card fraud/data security
- Late or non-delivery of ordered products
- Poor quality of products
- Difficulty in canceling orders or returning products
- Difficulty in speaking to an actual person at the company
If money is tight for a customer, then risk will be perceived to be even higher.
Increase Conversions through Customer Empathy
If you are experiencing a low rate of conversion, conduct a site audit to determine what might appear too risky for your potential customers. If, for example, your site isn’t encrypted, then Google will slap a big red NOT SECURE when your site appears in search results pages. Not good!
Are your cancellation and return policies easy to find, clear and reassuring? Do you offer a money-back satisfaction guarantee? If so, how quickly can a risk-adverse customer discover that fact on your site? Are you able to clearly and concisely show the value of your product or service? Are you using words such as “safe” and “secure,” for example, appropriately in your copy? Do you offer free trial periods for your subscription-based services?
Also do a persona audit. Dust off each of your personas and try to determine each one’s level of risk tolerance. As part of that process, talk to customers who fit each of those personas to understand what levels and types of risks this type of person would be willing to take. What is the line in the sand that he or she is not willing to cross? In what way should you edit your copy to reflect what you discover? To modify company policies?
Make sure your pricing is competitive. Prospects typically price compare and choose the best value so, no matter how much testing you do on calls to action, color selections, page layouts and the like, if potential customers can get a better deal elsewhere, all your conversion optimization testing may get you nowhere.
Although it’s important to show your company in the best light possible, don’t overpromise or exaggerate claims. Online shoppers are increasingly savvy and, when disappointed, not only have you lost their business, but you’ve probably created a wellspring of negative reviews. You already know how that would impact your conversions.
Finally, share references and provide testimonials, including quantitative data whenever you can, along with the most compelling quotes from satisfied customers. Be transparent. Reduce risk and risk perception alike, whenever and wherever you can.
Conversion Rate Optimization Strategies
Risk evaluation isn’t typically considered a part of the conversion rate optimization process, but it should be. If you’re ready to get started with boosting your site’s ability to convert site visitors into buyers, contact us online or call (904) 270-9778.