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Do you need a digital nudge?

Do you need a digital nudge?

Do you need a digital nudge?

Technology is increasingly important role in this modern era of hospitality. Large franchise chains, like McDonald’s and Starbucks, have seen explosive growth since their implementation of new technologies designed to ease the customer-ordering journey. But why is that?

We know all the benefits of ordering technologies from the business perspective; more data on the customer, greater staff productivity, enhanced marketing communications etc. But why is this good for the consumer other than the spillover-effect from the company’s benefits; lower prices or a faster service? One of the answers can be found in behavioural psychology, more specifically in the term nudging.

Nudging is a way to influence a person’s behaviour without them being aware of it. This is not as controversial as it may sounds; it’s about making it easier for that person to make a decision. To explain: If a consumer walks in to café to get some coffee (they have already made up their mind that they want the coffee) but then sees that there is a long queue, the menu is to complicated or it’s not clear where to place the order, they may abandon the purchase and leave. Or, if not leave, then be unlikely to return. Poor service is friction in the eye of the consumer and friction causes a person to back out of a buying decision.

Why this happens was explained in our earlier blog on convenience in choice. Friction forces consumers to use their system 2 brain, when they’d much rather rely on system 1. This is why nudging is a good tool to locate and remove friction.

How does nudging work?
One way to use nudging is to design a strategy that moves a person smoothly through the ordering journey. This includes the physical design of a restaurant or store; making the ordering and collection process an easy one.

If your business uses an ordering technology – like Preoday’s – digital nudging is an effective tool, easily wielded. With the ordering data you collect, for example, you can manufacture push notifications for customers offering deals on their favourite menu choices. By sending that notification in the period immediately before lunch or dinner, when people are thinking about what their food plans are, the nudge becomes that much stronger.

Another digital nudge can be given by asking customers to choose ‘meals’ rather than individual dishes – in much the same way that McDonald’s and many other fast food chains do. For the customer, it is more effort to opt-out of a meal and choose individual items than accepting the pre-designed menu option. Naturally, this can have a positive effect on your average basket size.

How you nudge your customers will vary depending on your audience profile and your business brand – what works for some, will not be suited to others. When planning your nudging strategy, look first to your audience segments and build a nudging plan to suit.

We have created a handy ebook compiling our different articles on psychology and influencing consumer behaviour. If you would like to read more on this topic, download it today

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