How to use blind box marketing to double the conversion rate?

When we were children, we were obsessed with toys; when we grow up, we are obsessed with blind boxes. Some netizens joked that it is always that group of people who get ripped off. The development of the blind box economy has prompted companies to launch related products and functions. So, how can we use blind boxes to double the conversion rate? The author of this article analyzes from three aspects and hopes it will be helpful to you.

1. Blind box actual combat results: new customer conversion rate increased by 100%

"On July 21, 2021, the blind box function was launched, and the conversion rate of this function was 4 times the new customer conversion rate of the overall market; starting from July 23, more traffic was introduced to the blind box function, and after stabilization, the overall new customer conversion rate increased by nearly 100%."

Many product managers working on the C-end or growth side hope that one of their needs can make the growth of the core indicators of the product show a curve like the one shown above. Fortunately, in July this year, I designed a gamified blind box demand, which doubled the conversion rate of new customers on the platform on the first day of activation.

In fact, earlier on, I summarized the "three elements" that make blind boxes effective from the perspective of the value that blind boxes bring to users. In the actual process, I also adhered to these three elements in my design, and after finally confirming their effectiveness, I would like to share them with you here.

2. Three elements of effective blind boxes

First of all, let us make a simple definition of the blind box we are going to talk about here: "Blind box is a trading model that provides a group of goods to users for reference, users purchase them at a fixed price, and randomly obtain any one or more of the goods."

Many people on the Internet are talking about the principles and logic of blind boxes, but few can explain the essence behind them.

Why are blind boxes effective? Some people say that blind boxes take advantage of curiosity; some say it is because there are hidden versions; others say it is because merchants are hyping it up, etc. However, these analyses of blind boxes are too abstract and superficial, and cannot help us understand the logic behind blind boxes, nor can they be flexibly applied in our own businesses. For example, if we believe that blind boxes take advantage of curiosity, then what is curiosity? Why does curiosity increase user motivation? If you don’t understand these, you don’t really understand the value of blind boxes.

This article starts from how blind boxes can improve users' perceived value and proposes the "three elements of effective blind boxes" as follows:

• Factor 1: The choice is irrelevant;
• Factor 2: Amplify expected returns;
• Element 3: The guaranteed return is positive.

The author believes that when the above three elements are met at the same time, the core of the blind box can be achieved. At this time, under the blind box packaging model, compared with the original transaction model, the user's perceived value of the transaction will be significantly amplified , which will lead to more transaction behaviors.

Element 1: Choice is irrelevant

First of all, the blind box model almost deprives users of the right to make choices . Users can’t choose the specific item they want and can only get one at random from a group, but this is not necessarily a bad thing.

In most cases, “making choices” can bring value to users. Take buying clothes as an example: users can choose a style they like from different styles of clothes; or users can choose the size that suits them from different sizes. In this scenario, "choice" itself is valuable and crucial, which is not applicable to the blind box model.

But there are also some cases where users have "difficulty in making a choice" or the choice itself is not important. Or, in a formula:

When the user's "energy cost of making a choice is greater than or equal to the benefits obtained through the choice" , we call it "the choice itself is not important." The blind box economy can only be applied in this situation. For example, when users need to choose one from 20 candies of similar flavors; or when users need to "flip a coin" to make a choice, these scenarios can be applied to blind boxes. Because depriving users of the right to choose at this time will not cause losses to users, and may even bring value.

* Practical strategy advice: When selecting products, you need to be universal so that the selection is insignificant. In addition, the products cannot be too important. For example, scenarios such as buying a house or a car, even if they are universal, are not suitable for blind boxes because the choice is too important. A relatively successful example is: a clothing blind box made in a certain e-commerce product, in order to achieve universality, only uses different colors of the same style as the product combination of the blind box, rather than spanning many different styles. Such a design meets the conditions for making a blind box.

Factor 2: Amplify expected returns

If a blind box is made just because "the choice doesn't matter", it is far from enough. This alone does not bring any additional value to users: why should they buy your blind box? Can't I just buy it by tossing a coin?

Therefore, for blind boxes to be effective, it is also necessary to magnify users’ expected returns! This is also the core of blind boxes that allow users to increase perceived value.

A common strategy is to add hidden items. If necessary, merchants can also hype up the value of hidden items, thereby increasing users' expected returns from purchasing blind boxes.

From a mathematical point of view, it can be understood this way: for example, there are 10 ordinary commodities in a blind box, and the average perceived value of the commodities by users is 50 yuan. Therefore, when the blind box is sold for 50 yuan, assuming that users' perceived value of the blind box is normally distributed, half of the users will choose to buy the blind box. If the probability of obtaining the hidden money increases by 1%, and the hidden money is hyped up by merchants, its value will be 10,000 yuan. Then the user's perceived value of purchasing the blind box becomes: (99%*50 + 1%*10000) = 49.5 + 100 = 149.5 yuan!

Through the hidden version, the perceived value was directly increased from the original 50 yuan to 149.5 yuan! For users who have a low perceived value of the blind box itself, the perceived value is greater than the perceived cost due to the existence of hidden items. Therefore, they are willing to buy blind boxes, which is why the conversion rate can be improved.

* Practical strategy suggestions : Add hidden items with universal or standard prices to maximize users' expected returns. On the one hand, you can magnify the value of hidden models through hype; on the other hand, you can also choose some standard products, such as a 1% chance of getting an iPhone 13 pro. In addition, the probability of winning sometimes does not need to be explained, and users will instinctively guess a probability based on past experience to estimate their expected returns. In short, as long as hidden products exist, users’ perceived value will be magnified.

Factor 3: The guaranteed experience is positive

The third element: the guaranteed experience cannot be lower than expectations.

This is actually because users will subconsciously estimate the expected benefits of the purchase. For example, if a product in a food blind box contains chili peppers, then for users who do not eat spicy food, the expected profit of this product is 0 yuan. The end user will subconsciously make an estimate in their mind:

Expected profit of buying a blind box = expected profit of product A * probability of obtaining product A + expected profit of product B * probability of obtaining product B + ...

When the expected profit of a product is 0, the user’s overall expected profit from purchasing blind boxes will be greatly reduced, thereby reducing conversion.

* Practical strategy advice: When selecting products, do not choose products that may have too low expected returns for users. For example, add lipstick to a blind box that may be purchased by men; or add men's underwear to a blind box purchased by women.

summary

The core of the above three elements is to reduce the user's decision-making cost when purchasing, while increasing the user's perceived value of purchasing blind boxes. The logic behind this is that users will only make a purchase when their "perceived benefits of purchase" > "perceived costs of purchase".

The core of blind boxes is to allow users to generate excessively high expected returns when purchasing through probability games and information opacity (product opacity or probability opacity), thereby prompting more purchasing behavior.

3. Practical Case Sharing

From a mathematical or logical perspective, as long as the above three elements are met, the user's expected benefits will be magnified and more users will make purchases. However, there are still two difficulties in the process of actual design requirements.

1. How to effectively convey this information to users?
2. How to make users trust you?

Because users may not be willing to spend time to understand the products in your blind box activities, and are even less willing to spend time to carefully calculate the expected returns. Therefore, during the product design process, we should try to let users make judgments in System 1, so that the product design can more intuitively convey the user's perception of high expected benefits. This is the only way to maximize conversion rate.

Here I would like to briefly share with you my practical experience with blind boxes. The background at that time was: we are a comprehensive e-commerce platform. We provide each new user with thousands of free products as new user gifts to choose from, but the conversion rate is still not very ideal.

This also troubles our product team: even though the product is already free, there are still a large number of users who don’t buy it.

We think the possible reasons are:

• Users don’t trust the app enough;
• Users need to pay additional selection costs and fill in the delivery address and payment information when purchasing. These costs are too high and lead to no purchases.

To solve this problem, on the one hand, we added more elements about trust, such as showing other people’s evaluations and the platform’s commitments. At the same time, the efficiency of users filling in information in the payment process has been optimized, but the effect is minimal.

In the end, we decided to start from the perspective of perceived value and use blind boxes to enhance users' perceived value of our new customer benefits, thereby increasing conversion rates (at that time, no other e-commerce platform used blind boxes to convert new customers).

In the process of actually designing blind box activities, my main ideas are as follows:

1. Reduce the cost of selection and ensure a positive guaranteed experience : Because it is a benefit for new users, too many free products for users to choose from may actually be a waste of users' minds. Therefore, the form of blind boxes is adopted to eliminate the user's choice cost. A group of universal and attractive products (electric toothbrushes, sunglasses, etc.) were selected.
2. Expand expected payoff : Include an Apple Watch and headphones as hidden rewards. The prices of these products are relatively well known to the general public, making it easier for users to subconsciously calculate their expected returns. At the same time, the user is not told the probability of winning. The user may instinctively think that the probability of getting an Apple Watch among ten products is 10%, but in fact it is 0.1%.
3. Create rationality : There is no free lunch in the world. The reason why users do not trust the platform may be: Why do you want to give me things for free? Are you going to steal my personal information? Therefore, I adopted the form of lottery (which is also a common trick used by Pinduoduo), so that users can finally "draw" the opportunity to receive the blind box.
4. Create a sense of scarcity : use terms such as informing users that the opportunity to receive a blind box is rare, the time limit is 30 minutes, each user can only receive it once, etc.

Connect the above design ideas together and create a storytelling effect when designing the product. After reading this story, the user's expected value for receiving the prize will be greatly increased. In the end, the blind box achieved remarkable success after its launch, which is the data shared at the beginning of this article (due to the confidentiality of the company's business, the prototype picture should not be made public here, please forgive me).

This is the end of my sharing about blind boxes for now. I hope it will be helpful to everyone. You are also welcome to communicate and discuss with me in the comment section.

Author: Keyda who loves learning

Source: Keyda, who loves learning