This document discusses motivation-based marketing strategies. It begins with an overview of hedonic and utilitarian shopper models. It then discusses how to tailor product descriptions and re-engage abandoned shopping carts based on whether customers exhibit hedonic or utilitarian motivations. Methods for determining a customer's motivations include analyzing their purchase history with machine learning or using a personality inventory. The document also addresses legal and ethical considerations of profiling customers in this way.

1. Motivation based Marketing
Alex Bordei, director of product and development

2. • Specialized in distributed computing, HPC and high
performance architectures
• In charge of product development and sometimes big
data bootstrapping consultancy
About me
Alex Bordei
Director of Product and Development @ Bigstep
@axbrd

3. 1. Utilitarian vs Hedonistic models
2. Motivation based product descriptions
3. Shopping cart abandonment
4. Determining who is hedonistic and who is utilitarian
5. Technicalities of big data approaches
6. Legal considerations
7. Ethical considerations
Agenda

4. O = Openness to experience
Low = conventional, traditional
High = curious, adventurous
Personality facets: Adventurousness, Artistic interests, Emotionality, Imagination,
Intellect, Liberalism
C = Conscientiousness
Low = impulsive, disorganized
High = self-disciplined, methodical
Personality facets: Achievement-striving, Cautiousness, Dutifulness, Orderliness,
Self-discipline, Self-efficacy
E = Extraversion
Low = quiet, reserved,
High = social, gregarious
Personality facets: Activity level, Assertiveness, Cheerfulness, Excitement-seeking,
Friendliness, Gregariousness
A = Agreeableness
Low = skeptical, self-interested
High = trusting, group-oriented
Personality facets: Altruism, Cooperation, Modesty, Morality, Sympathy, Trust
N = Neuroticism (also called “Emotional stability”)
Low = calm, unflappable
High = worries more, easily made anxious
Personality facets: Anger, Anxiety, Depression, Immoderation, Self-consciousness,
Vulnerability
The Big Five Personality Traits

5. Hedonic shoppers
Openness to Experience,
Agreeableness,
Extroversion
Utilitarian shoppers
Emotional Stability,
Conscientiousness
source: Gianluigi Guido (2006) Shopping Motives, Big Five Factors, and the Hedonic/Utilitarian Shopping Value: An Integration and Factorial Study
Meta-traits (motivations)

6. Motivation based product descriptions
Actual product:Lark & RO
“Our ultrasoft turtleneck sweater offers the
comfort of luxurious knit cashmere in
a stylish and cozy top you’ll love.”
“This slightly fitted turtleneck is a blend of 95%
cashmere and 5% cotton in jersey-knit
construction”
hedonic utilitarian

7. Shopping cart abandonment
source: Baymard Institute (2017) E-Commerce Checkout Usability https://baymard.com/lists/cart-abandonment-rate (accessed 22 may 2018)
69.23%
average documented online shopping cart abandonment rate

8. Shopping cart abandonment
source: https://www.shopify.ca/blog/8484093-why-online-retailers-are-losing-67-45-of-sales-and-what-to-do-about-it
(accessed 22 may 2018)

9. Shopping cart abandonment
source: https://www.shopify.ca/blog/8484093-why-online-retailers-are-losing-67-45-of-sales-and-what-to-do-about-it
(accessed 22 may 2018)
?

10. Shopping cart abandonment
source: Baymard Institute (2017) E-Commerce Checkout Usability https://baymard.com/lists/cart-abandonment-rate (accessed 22 may 2018)
58.6%
of US online shoppers have abandoned a cart within the last 3 months because
“I was just browsing / not ready to buy”

11. Shopping cart abandonment

12. Hedonic
Shopping cart abandonment

13. […] Hedonically motivated shopper doesn’t need to complete the transaction.
The shopping experience itself was the outcome they desired. They don’t
need to buy to get satisfaction; they need only browse.
source: https://unbounce.com/conversion-rate-optimization/hedonic-shoppers/ accessed 2018
Shopping cart abandonment

14. 1.Get an email address or other means of contact if available
2.Remarket to hedonic cart abandoners through triggered emails
3.Promise hedonic shoppers more of the rich, engaging experiences they desire
within your emails
source: https://unbounce.com/conversion-rate-optimization/hedonic-shoppers/ accessed 2018
Shopping cart abandonment - What to do about it

15. Determining who is “hedonic” and who’s not
A.IPIP Big-Five Factor Markers
B.Proxy via products purchased with machine
learning on the full dataset (a.k.a big data)
source: IPIP Big Five Factor Markers, openpsychometrics.org accessed 22 may 2018

16. apparel
books, music, and movies
flowers
jewelry
…
luxury items
Hedonic Products
Hedonic Products: Products associated with experimentation, enthusiasm,
satisfaction and pleasure, typically leading to emotional gratification.

17. Source: Diffusion of Hedonic Goods: A Literature Review
Product-specific parameters Hedonic Goods Utilitarian Goods
Type of good Experience Search
Quality uncertainty Relatively high Relatively low
Attributes Subjective, symbolic/aesthetic, intangible,
scarce
Objective
Seasonality seasonal goods often mass products
Diversity Dependent Independent
Life cycle Unique Multiple versions of one product Bell-shaped
curve; time frame of sales
Demand-specific parameters Rapidly declining; short time frame (few
weeks)
depends on product (years)
Consumption risk Relatively high (economic and social risks)
Multisensory, varying
Relatively low (economic and technical risks)
Not multisensory
Consumption experience Low cognitive involvement, high emotional High cognitive involvement
Involvement Involvement involvement
Product valuation Emotional, subjective Rational
Purchase motives Emotional, variety-seeking, expression of
individuality and subjectivity, symbolic
character
Rational
Purchase decision Holistic choice (depends on subjective product
features)
solution of problems
Type of purchase Impulsive objective product features) Convenience
Consumption frequency Limited Depends on product
Example music, films, books, performing arts washing machines, yogurt
Determining if a product is hedonic or not

18. Hedonic Utilitarian
Source: M. Clement, S. Fabel, and C. Schmidt-Stölting (2008) Diffusion of Hedonic Goods: A Literature Review, The
International Journal on Media Management, 8(4), 155–163
Hedonic versus utilitarian products lifetime

19. Source: Diffusion of Hedonic Goods: A Literature Review
Hedonic products “signatures”

20. Source: Diffusion of Hedonic Goods: A Literature Review
hedonic products “signatures”
“Blockbuster” movies “Sleeper” movies

21. Big Data Technicalities - Labeling products

22. Big Data Technicalities - Labeling Customers

23. Using the data

24. Legal Considerations
Is this GDPR compliant?

25. GDPR Considerations
It is GDPR compliant:
1. The input data (purchase history of a customer) is collected legitimately and
should not need consent
2. The use of the above data for improving one’s services is part of the legitimate
use
3. The profiling that gets done does not produce legal effectsHowever:
A. Right to object: The user must be able to object to the profiling
B. Notice and access: The user must be aware that this profiling is happening
and the logic involved
C. Privacy by design: The data must be stored securely, need data impact
assessments

26. Ethical Considerations
Is this ethical?

27. Ethical Considerations
It’s not a form of manipulation if the user is aware of it.
Also:
- We’re not determining your full personality profile (the big 5), only an inclination that any
human would be determine in a dialogue with that person.
- Tailoring product’s presentation improves the experience of both hedonistic and
utilitarian shoppers
However:
- The border between optimization and manipulation is not very clear

28. @axbrd
@bigstepinc
bigstep.com
I’m all ears

30. Other resources:
1.https://static1.squarespace.com/static/50a5e160e4b0e80bad9bfe3d/t/50ac6e29e4
2.https://www.emeraldinsight.com/doi/abs/10.1108/IJRDM-07-2012-0065
3.https://conversionxl.com/research-study/utility-vs-hedonism/
4.https://www.sciencedirect.com/science/article/pii/S1057740816300328
5.http://www.acrwebsite.org/volumes/v36/naacr_vol36_217.pdf
6.https://businessperspectives.org/images/pdf/applications/publishing/templates/arti
7.https://www.researchgate.net/publication/311562040_A_Preliminary_Examination
8.http://www.richardbenjamintrust.co.uk/uploads/finalreports/2013/DStillwell.pdf
9.https://applymagicsauce.com

31. Source: Youyou et al. (2014) Computer-based personality judgments are more accurate than those made by humans pnas.1418680112
Computer-based personality judgments are more
accurate than those made by humans

32. Source: Youyou et al. (2014) Computer-based personality judgments are more accurate than those made by humans pnas.1418680112
Computer-based personality judgments are more
accurate than those made by humans