The Psychology of Effective Conversion Rate Optimization

by Steven Macdonald September 11th, 2013 

Lucky Supermarket, San Leandro, California 1947

Conversion rate optimization is not something that happens overnight. In order to get more people to buy from you, you need to understand who you are selling to. Do you know who your customer is?

Think of a car salesman; would a car salesman have the same sales pitch for an experienced driver compared to someone looking for their first car?

Whether you are conservative or aggressive in your online marketing, the trick is; how can you sell to different countries, religions and nationalities with a one-size-fits-all approach?

The answer is…you can't.

The Current State Of International Ecommerce

Internet usage all over the world is consistently growing. With 137 million users in China, 86 million users in Japan and more than 40 million users in India, the world is becoming more connected each day.

Chinese online shoppers spend more than $40,000 each second. If you want to succeed online, you will want to test new markets. Not only are the Chinese leading the way in online spend per second, they are the world leaders when it comes to online spend.

clip_image002

And e-commerce spend is not slowing down. In 2004, ecommerce spend was just under $1 billion. In 2013, analysts expect it to reach more than $145 billion and based on current trends, will surpass $200 billion by 2015.

clip_image004

This kind of data allows businesses to go global at a rate that was not possible 5-10 years ago. Using location and language data in Google Analytics, you can identify traffic growth trends from countries that were never in your business plans.

And you can now launch a new website in any country with a relatively small translation budget. But how many businesses have found this strategy successful? Not many…

How Culture Affects Online Consumer Behavior

One of the biggest factors in online purchasing is culture. Culture affects buying decisions. For each country you enter, your website should be different. We've talked about mastering international SEO before. This post addresses websites that target multiple countries and how you should approach each country using the six dimensions of national culture.

Before we get started, if you haven't heard of Professor Geert Hofstede, he is an 84 year old Dutch researcher and the 4th most cited social scientist of all time (and one of the only social scientists within the top 5 who is alive). His major contribution to social science is within organizational culture and cultural economics.

Geert Hofstede defines culture as:

"The collective programming of the mind distinguishing the members of one group or category of people from another"

** "category" refers to nations, regions, religions, organizations or gender.

The 6 Dimensions of National Culture

Based on more than 117,000 surveys at his time in IBM between the 1960s and 1970s, Hofstede developed the six dimensions of culture. The six dimensions include:

Power Distance Index (PDI)

Individualism vs. collectivism (IDV)

Masculinity vs. femininity (MAS)

Uncertainty avoidance index (UAI)

Long term orientation (LTO)

Indulgence vs. restraint (IVR)

Since the 1970s, similar studies have been replicated that found similar results, which shows the stability of the six dimensions over time.

1. Power Distance Index

The power distance index was developed to measure the distribution of wealth between people in a nation, business or culture. Some consider the PDI of a comparison between the "haves" and have nots". A totalitarian regime has a high PDI, while a democracy has a low PDI.
clip_image006
High power distance index countries are very patriotic so when creating the website be sure to include national and cultural symbols. Colors should be similar to the country's flag color and any claims should be backed by certificates of approval from experts.

Low power distance index countries prefer websites to be clean and transparent. Make use of expert testimonials and include happy customer reviews.

2. Individualism Vs. Collectivism

An individualistic culture measures low cohesiveness between people whereas a collectivist culture measures tight bonds and groups. Collectivists are integrated into communities from the day they are born and in return show unconditional loyalty. Individualism cultures see themselves as self-independent instead of identifying with groups and value personal goals over group goals.

clip_image008

Canadian, British, American and French websites should reward users to create brand loyalty and focus on the uniqueness of products sold on the site. Use images with younger people and over-emphasize privacy and trust. These countries prefer to be unique and lead the way in terms of buying trends.
On the opposite side of the scale, the Japanese, Russians and Indians prefer groups over individuals. It's key that you use "we", instead if "I" in your terminology and use testimonials from older people to emphasize trust and hierarchy. These countries purchase products that are widely accepted within their communities.

3. Masculinity Vs. Femininity

When referring to masculinity and femininity, it has nothing to do with gender but instead the roles in society. Masculine cultures value assertiveness and competition whereas feminine cultures value caring and modesty.

clip_image010

If you are launching a website in Japan, Germany or Italy, you should allow the user to explore the website by using main navigation menus and sub-navigation menus. Use media such as graphics, images and video but be careful with images, as you need to make sure the roles are clear cut such as male doctors and female nurses.

Countries like Sweden, Denmark and France are more feministic in culture and have a greater focus on life. Ecommerce sites should emphasize how products can benefit the customers and be open to feedback in the form of customer surveys or online communities and forums. Keep the site clean and use groups in images.

4. Uncertainty Avoidance Index

Countries with a strong UAI follow strict codes of belief and behavior. They tend to be more emotional and proceed with careful, step by step planning that follow rules, laws and regulations. Weak UAI countries are more relaxed and are more comfortable in unstructured. Weak UAI countries try to have as few rules as possible.

clip_image012

Countries that have a high uncertainty avoidance index that include Greece, Belgium, Poland and Russia should have a simple website that uses clear, easy to understand language. Use color coding to separate different sections of the website and be consistent in your terminology. And make sure to avoid pop-ups and light-boxes that may look like spam.
Countries with a low uncertainty avoidance index can use drop down menus on their website, make good use of internal linking by recommending relevant products or stories and having a search box on the website would also benefit the visitors. Countries with a low uncertainty avoidance index include Sweden, Norway and the UK.

5. Long Term Orientation

Long Term Orientation is defined as focusing on long-term goals and giving importance to the present and future, rather than the past and values and tradition are very important. While short term orientation societies place their values in the past and present.

clip_image014

Countries such as China, Brazil and Japan have a high long term orientation which means reputation management is very important. Websites need to be much more educational and should include webinars, free training, research and white papers and clearly outline key benefits.
For countries with low long term orientation such as Germany, Sweden and the UK you can allow the website to become more playful and interactive by being seasonal with your images, allow star ratings systems on your products but you should support any facts with evidence, whether through social proofing or third party reviews.

6. Indulgence Vs. Restraint

Indulgence stands for a society that can freely satisfy their basic needs and desires where restraint stands for societies where strict social norms are followed.

clip_image016

For websites targeting Sweden, Australia, the UK and the US, your website needs to be fun and engaging. Create content that people can share with their friends and use social proofing to back up any claims. Be honest, and in these societies you can use both women and men in images. For these countries, price is not an option so it's more about the fun website experience.
For countries targeting Italy, China and Russia that have a low indulgence rate and are more restrained in their buying behavior your website should be targeted more towards a community rather than the individual. Be formal in your social media and customer service communication. If you accept online payment, don't be afraid to over-communicate safety and security. Smiling in images in frowned upon and sales or discounts will work better as pricing becomes a more important issue.
Example: Swedish culture vs. Russian culture

Although Scandinavia and Russia are close to each other in terms of geography, the cultural differences are almost complete opposites. Many Scandinavian brands launching in Russia just because they are within reaching distance will ultimately fail online.

If you have a website that you target in both Sweden and Russia, here's how they need to differ when following the six dimensions of national culture.

clip_image018

Do you think a one size fits all approach would work for both Sweden and Russia based on the above?

Conclusion

If you have an International website that is not meeting its full potential, then you are not following the six dimensions of national culture. Having a different website for each website may be resource-intensive but if you are serious about international ecommerce, you don't have a choice.

If you want to out-perform and out-sell the competition, follow the six dimensions and you will see a positive impact on visitors, branding and conversion rates.

Do you have a different website for each country? How do you manage International ecommerce? Let me know below.

Additional Sources

Steven Macdonald

Steven Macdonald has been working with online marketing since 2005. Experienced in online gambling and travel, Steven is currently working on International SEO with SuperOffice CRM and regularly contributes to the Tribes blog.

Tribes

You May Also Like

Comments are closed.