When people are confident of their next paycheck, they have a predisposition to buy most of their “because I want it” items that are within financial reach (and maybe even just out of reach as well – hence the credit card). That’s because their psychic pain threshold for buying is just above their actual expendable income level.
Here’s how to visualize it: there are usually, say, 5-7 “extra-budgetary” purchases a person might have in mind for the next two months or so: nicer sunglasses, or an expensive wireless mouse, or shoes or some type of clothing, etc. And most of those things will actually get purchased within a rolling 2-3 month time frame, without the buyer feeling that any of them represent a considered purchase – even if the sunglasses or shoes might be in or above the $150 range.
But that’s only in a prosperous and sunny economy, which we ain’t in right now.
Right now, people’s psychic pain threshold has dipped below their real level of expendable cash – they can still afford some extra-budgetary purchases, but parting with the cash feels a lot more painful.
More plainly, these discretionary items have just transformed into considered purchases.
Rather than buying these “I’d like to have” items in fairly quick succession, people will window-shop the hell out of them, mentally comparing the emotional pay-off to the price, trying to bridge the psychic pain gap. And then they’ll buy just one of them – or maybe two by going with, say, less expensive sunglasses and slightly cheaper shoes.
What this shopping behavior looks like in the aggregate is that people are still buying, but:
- Average order size drops, a la the cheaper sunglasses
- Conversion rates edge down due to return window-shopping visits
- Traffic/Unique Visitors goes down.
But wait, why would traffic go down if people are doing MORE window-shopping?
Because there’s only so much space in our mental queue of “gee I’d like one of those.” There are thousands of things I want, but I can only actively ruminate on – and really feel the want of – a handful of them at any one time.
So if actual purchases slow down, then the rolling 2-3 month want list gets backlogged and it becomes “survival of the fittest” for items to stay active in my mental buying queue. I’m window-shopping more, but for less things in any given span longer than 3 months. And that means an aggregate dip in traffic for most Websites.
So what can you do about it?
How can you fight these trends and stay flat (aka “the new up”) instead of trending down?
Start acting like you’re selling a considered purchase; consciously aim to overcome the psychic pain threshold, instead of assuming the buyer has a green light for purchasing. Here are some tips on how to do that:
- Insist on superior product photos, descriptions, and objection-handling sales copy. Think about how much more research you do for a car than a t-shirt. Think about the kind of reviews written up on Edmunds.com compared to the average product description you’ll find at Target. Emotionally, there’s more at stake so you require more information/copy.
- Know that you’re competing well outside your category to get customers’ expendable cash – and be compared to compete. Build long-term perceived value around your product while lowering buyer anxiety. Customer reviews are often far better at this than copy. That means reviews shouldn’t be seen as optional any more, and that you should learn how to incorporate these review-elements into your sales copy.
- Start optimizing for conversion now. Seriously. You’re competing for market share in a smaller market. You only stay flat if you take customer’s expendable income away from competitors, and it’ll help if your Website is more persuasive and efficient than theirs.
