Tips to use Endowment effect in e-commerce.

1. Endowment effect
in inbound marketing

2. WHERE DID IT COME FROM?
The experiment was hold by three scientists: professor
Richard Thaler,Jack Knetsch and a professor of psychology
Daniel Kahneman.
In the first part of the experiment scientists gave coffee mugs
(which cost 6$) to one half of students and announced, that
these small gifts became the property of the participants. After
some time, the auction between the happy owners of unique
mugs and ordinary students began.
After the end of auction it turned out that the offer price set
by the owners of mugs reached approximately 5.25$ per cup,
while the demand price by students was around 2.25$ - 2.75$.

3. CONCLUSION OF THE EXPERIMENT
The price of goods established by the owner, will
be significantly higher than the one for which the
same person would be willing to buy the this
product.
This is the endowment effect - its essence is
very simple: people appreciate the things that
they already own more, than those, which they
might own.
http://gedankennahrung.de/endowment-effekt-warum-wir-unseren-besitz-hoeher-bewerten/

4. Imagine, you come to the salon to buy a car and the shop assistant not only shows you a car, but also gives you a
possibility to try it in test drive. While driving you can feel the car on the road and pretend yourself a real owner
of it. Moreover, you start to associate yourself with this car.
What happens? Here comes the endowment effect - you feel the car yours and are ready to spend more money
on it, than after getting the ordinary information about it.

5. According to the statistics by The
Maritz Research, which surveyed
80,219 buyers of 2012 model-year
vehicles, only 11.4% didn't take a test
drive.

6. How to deal with
e-commerce and the
inbound marketing?

7. FREE TRIALS
Free demo version of any software product is the first step to the
acquisition. Why so? Because it is the most bright example of the
endowment effect in inbound marketing. It gives the feeling of owning the
product or service.
When the use of the test period ends, you already have time to get used to it
and want to pay for the purchase. Especially if the demo is good.

8. Avast Antivirus offers Internet Security software free for 30 days. It is the brightest opportunity to
attract people - give them to try. It is better than any advertisement, because the opinion on the product
or service would be based on the own experience of the user.
After the potential customer learn a lot about the software (like in case of Avast) he or she would be
ready to pay for it with a greater pleasure, knowing exactly what to pay for.
https://www.avast.com/download-trial

9. DISCOUNTS AND COUPONS
Permanent discount coupons can be attributed to the endowment effect.
In this case, the keyword is permanent. The buyer is aware of the right to use the
discount at any time, whenever he or she wants, so it gives the feeling of
master in the situation, the discount is already a kind of property, and that's
why it becomes to be more valuable.

10. Permanent discounts became so beloved,
that there appeared even the portals with
the coupons in different fields. The most
important here is, that they found their
customers!
One of the websites, collecting the
discounts at the one place is Groupon,
which is successful according to the users’
activity. There you can buy a coupon or
even several ones on any offer and use it
when you want to do it.
https://www.groupon.com/

11. What is more:
1. "Gift card" instead of "coupon".
Sometimes, for the customer to feel him/herself
the rightful owner of a benefit provided by an
online store, it is needed simply to replace the
word "coupon" with the phrase "gift card".
2. The absence of a call to action. Make the
customer free from having to make decisions.
Notification like "We've added a gift card on 25$
to your shopping cart! Make a purchase at 75$
and save 25$ " will greatly facilitate his life and
increase the possibility of purchase.

12. SELLING TEXTS
Of course, in the text it is impossible to give a person to try something. But
you can do so that the potential customer starts to imagine him/herself the
owner of your product. You need to be precise and specific to show the
process of how your service or product is presented and how it feels to be the
owner of it.

13. Look at the ThinkGeek, as an
example. The text explains you,
how to deal with the product if
you have it. To practice this
copywriting technique it is
better to start a sentence with the
word imagine to attract the
attention and finish the
paragraph by explaining how your
reader will feel when owning
and using your product.
http://www.thinkgeek.com/product/itnq/

14. SCORING
The online stores ask their customers to score, give marks or write a review
on the product or service. Instead of it, you can even offer to give the
feedback to the product after the purchase. "How much should this hair dryer
cost?" Or more rigid, “For how much would you agree to sell it?"

15. Here is an example from the Innocent, where they have the scale with the reviews
near the product. Share knowledge about product by telling stories of happy
customers and explain even the tiniest details. Make an effort not to be boring
and create bright unique descriptions.
https://www.innocentdrinks.co.uk/things-we-make/juices/juice/smooth-orange-juice

16. ADDITIONAL OPTIONS
Very often you can meet such a situation: you install a free app and can use it
free of charge, but with the exception of some features. These additional
features should be payed. It happens not only with the applications, but also
with the social networks, software, ect..
On the one hand this product is totally free, but on the other hand to have, for
example, a premium version, you need to pay.

17. Let’s take the famous social
network LinkedIn as an
example. You can use
approximately all the
functions, but in a limited
way. Otherwise you need to
buy the premium version.

18. Taking into consideration such a tool of
influence as the endowment effect you can
increase the purchase rates, without any
pushing on the leads actions. It would be
beneficial both for you and for your
customer.