Decoding contextual nudges: A dummy’s guide

As you scroll through the quick delivery grocery app, a small text sometimes draws your attention to the best offers available. Or when you are trying to pay your mobile bill on the network’s app, an arrow guides your attention to the latest features on the app. Increasingly, more brands are using these nudges to lead its users to the decisions it wants them to make.

In this article, we break down how these nudges work on our mind and why brands opt to use them.

What are Nudges?

Brands have been nudging consumers for ages now, whether it is through the right supermarket display or through the correct placement of ads. But now with recent technology, marketers are nudging consumers to make favourable decisions on their apps as well.

Nudges are a subtle tool used by marketers to influence consumer behavior. It is a customised navigator that leads the app users to the next action the brand wants them to take. Making the most of data-driven intelligence, they are able to persuade users to do exactly what they want them to.

The nudges can be contextual, that is not everyone receives the same nudge. Rather it is customised based on the person, location and past behaviour on that application. For example, someone who’s interested in good offers can be nudged to attractive discount coupons, while another who’s looking for quick delivery can be nudged to the ‘same day delivery’ option. This helps create a more individual experience on the app.

Two companies that provide this technology are Netcore Cloud and Apxor.

Nudge Theory

The Theory suggests that when humans are placed in a certain time constraint situation with too many options around, they tend to choose the option which is presented to them. When someone guides us to a specific set of actions, we tend to accept that and go ahead with it rather than taking decisions ourselves.

How can it help brands?

Many users uninstall the app after accessing one page or product. But these contextual nudges can help make them a loyal user of the app.

While in-app messages and push notifications also serve a similar purpose, they tend to get lost in the stack of notifications popping up on the user's screens. They can be used for user onboarding for product guidance, feature discovery and adoption, and in-app announcements. Nudges can positively impact metrics like higher conversions, better retention, increased feature adoption and smoother on-boarding experience.

After downloading an app if a user gets the right guidance on how to use it and its features, they are less likely to uninstall the app. For the brand that has spent a lot on acquiring the customer, it is essential that it manages to retain them as well. Eventually it wants the user to find so much value in it that they are willing to pay for the service. The nudges allow them to create that journey for the user where they can keep them engaged, and slowly upgrade that experience to monetise it.

Which categories can benefit from this technology?

This is beneficial for all categories where their app is an essential part of their business.

Chris Higgins, senior vice president - marketing, Netcore Cloud, says that categories like OTT, FinTech, EdTech can make the most of it.

“An OTT app has multiple options- movies, TV, recommendations, popular, trending, etc- that it becomes difficult to make a choice. In the case of a FinTech app, people are worried that if they make a mistake they may lose money. So they want to be guided. In the EdTech space it can help reduce drop outs as they can use it to motivate the students and retain them,” he says.

Netcore Cloud has clients like Airtel, Air Asia and MPL. The Hyderabad-based company Apxor has clients across e-commerce, ed-tech and gaming platforms like Dream11, A23, Doubtnut and Zepto.

What do these companies have to offer?

Netcore Cloud ensures that the addition of the new tool doesn’t increase the file size and slow down the app.

“We've integrated our product experience code into our main Netcore products, which means we're just one addition rather than having to install two or three more things onto an app,” Higgins says.

Moreover, it is a no-code product, which means brands can add elements to the mobile app without having to code. “That way the person running that app, has a lot more flexibility, agility and power to just create a new feature and take it live, rather than going to the developer. This not only saves them the trouble of finding a developer but also saves them time. If it has to go through the developer it would take around two weeks time, not it is completed in 15 minutes.

Apxor Technology Solutions allows for real-time customisation. “We also provide the ability to individualize nudges. Copy, Creatives can be personalised in real time, depending on the context, and the business requirement. For example a person's wallet is short of Rs 30 to complete a transaction and so he is about to leave the checkout, Apxor can dynamically give him a discount. This capability helped many RMG (real money gaming) apps to target users with very individualised discounts. This is an ability that only Apxor has,” says Suneeta Munjuluri, Product Marketing Manager, Apxor Technology Solutions.

“Ours is an insights-driven and data-driven platform. We also provide insights like where do the brands really require to provide the nudges and where it will work best, hence Nudges improve the core KPIs (activation and conversion),” she adds.

Nudging or manipulating?

While brands persuade users to do what they want them to do, there is a very thin line between nudging them and manipulating them into taking those decisions. Especially since these nudges are subtle and non-intrusive, often the users may not even realise that they are being led towards a decision.

For example, while booking movie tickets, the app often claims that the seats are filling fast. Now users have no way of knowing if it's true, but they do feel a sense of urgency to book the tickets right away.

“Manipulating users can cause long term damage to the brand as they lose trust. The whole intent of the nudges has to be to create a positive experience for the user. The action should have benefits for the user as well,” adds Higgins.